Polygon Labs is excited to welcome Celo home to Ethereum in the chain’s transition from an independent EVM-compatible L1 to an Ethereum L2. As Ethereum devotees obsessed with scaling, we are beyond excited to see Celo expand into an emerging and thriving Ethereum ecosystem and help extend Ethereum blockspace.
We would like to offer an alternative path for transitioning to an L2, one that would let Celo maximize the advantages of being an Ethereum L2 while maintaining the characteristics that made the chain a success in the first place. Migrating to an Ethereum L2 is a large technical upgrade that should come with built-in Ethereum alignment and as-close-as-possible developer experience, without compromising security.
To that end, Polygon Labs proposes that Celo Ecosystem choose to deploy an L2 using Polygon CDK (Chain Development Kit), an open source toolset developers can use to spin up their own ZK-powered L2 for Ethereum–and that permits existing L1s to convert to Ethereum L2s with little friction and an emphasis on modularity.
Here is an overview of the key value propositions for deploying using Polygon CDK:
- Increasing cross-community collaboration by joining hands in an ecosystem of robust, ZK-powered L2s;
- An EVM-equivalent environment for enhanced compatibility, so developers can experience the closest alignment with Ethereum as technically possible;
- Increased security that leverages Ethereum’s battle-tested consensus layer with the security of zero-knowledge proofs, instead of relying on social-economic incentives;
- Maintain low fees, made possible by a zkEVM validium architecture and off-chain data availability;
- Access to Unified L2 Ecosystem that brings together Ethereum mainnet and Polygon ecosystem into one massive economy, with the feel of a single chain;
- Customizability of an app-chain stack and interoperability with all Polygon L2 chains;
- Near-instant withdrawals, compared to a week;
- Fast finality and instant cross-chain interactivity, secured by ZK; and
- Support that meets the standards of the biggest Web3 projects and Web2 companies alike.
This document will cover Polygon Labs’s alignment with Ethereum and development of its ZK tech stacks, deep-dive into the value propositions for upgrading to ZK, suggest a possible design, and walk through the impact on key stakeholders.
Our proposal is the beginning of a dialogue in a scenario where, no matter what, everyone wins, because Celo will be transitioning to an Ethereum L2!
Ethereum Alignment and Background in ZK
Ethereum is the paragon of decentralized, permissionless technology, and every step taken by Polygon Labs has been with the goal of scaling not only Ethereum, but its values, as well. With L2 and rollups on its roadmap, Ethereum’s future relies on implementing the best technology to scale securely and in a frictionless way.
Core developers at Polygon Labs have spent years building ZK technology that aligns with Ethereum as closely as possible. Breakthroughs, including the Plonky2 ZK proving system, have meant that L2s see reduced fees and finality times across use cases, all while inheriting the decentralization, security, and existing tooling and smart contracts that make Ethereum the best programmable blockchain.
To fully align with Ethereum’s vision of scaling with on-demand L2 deployment, we developed Polygon CDK (Chain Development Kit). Chains deployed using Polygon CDK extend Ethereum blockspace. These chains join a unified L2 ecosystem with the fastest canonical L2 <> L2 transfers. In the future, these chains will experience automatic shared liquidity through a novel ZK interoperability layer. That means that all L2s developed with CDK are connected to all others, creating unified liquidity in an environment that feels like a continuous mesh of blockspace.
In practice, Polygon CDK means near-instant cross-chain interactivity, Ethereum included, all with the power of ZK proofs. This is an unlock made possible specifically with ZK, and unavailable to fraud proofs. Chain states are aggregated in a single layer and posted to Ethereum, the validity of which is guaranteed by math, rather than social-economic incentives.
The result is a network of ZK L2s that are so seamlessly connected it feels like a single chain, with one-click access to Ethereum’s liquidity.
Chains being developed using Polygon CDK include Immutable zkEVM, Gnosis Pay, Canto, Capx, Palm Network, and others, as well as Polygon PoS (with a proposal to become a zkEVM validium), Polygon zkEVM, and (eventually) Polygon Miden.
Polygon Labs believes in an equitable, inclusive world brought forward by decentralized technology, and our belief is that such a world can be achieved with alignment within a broader Ethereum community.
Upgrade Value Propositions
The following is broken into two parts:
- Addressing the initial value propositions proposed by cLabs; and
- Describing unique value propositions unlocked by Polygon CDK.
At a high-level, these responses walk through the technical value proposition of deploying with Polygon CDK and orient this decision within the larger efforts of scaling Ethereum.
Initial Value Propositions Proposed by cLabs
From cLabs’s proposal: “While learning from proposals as they’ve been released, officially aligning to the Ethereum community offers the Celo ecosystem an opportunity to not only collaborate with the Ethereum community on existing EIPs, but also introduce our own, with near term examples being exploring standard for off-chain data availability and decentralized sequencers.”
Polygon Labs is eager to work alongside core Celo developers to standardize off-chain data availability and develop the best decentralized sequencing tech possible. As for off-chain data availability, Polygon CDK allows configurability for DA solutions, with the ability to integrate with third-party DA providers. As for sequencers, decentralized sequencing is on the roadmap for Polygon CDK, and Polygon Labs would love to work closely with cLabs developers to find solutions that meet the Celo community’s needs.
From the cLabs proposal: “Migrating Celo to utilize the OP stack eliminates the need to monitor compatibility, making it easy for Celo developers to utilize the full gambit of Ethereum tooling / libraries.”
cLabs understandably wants to maintain the network effects of Ethereum alignment, and the best way to maximize that is with EVM-equivalence. Polygon zkEVM is the only EVM-equivalent ZK rollup live on Ethereum Mainnet. EVM-equivalence means that an L2 built with Polygon CDK will be compatible with the EVM at the bytecode-level: any tooling and smart contract that works with the EVM, works with Polygon CDK. Relative to EVM-compatible implementations, EVM-equivalence provides greater security by reducing the surface area for potential bugs.
cLabs has listed increased security as a value proposition for Celo becoming an L2 for Ethereum. Polygon CDK offers optimal security without sacrificing any other advantage of becoming an L2.
Any L2 chain deployed using Polygon CDK inherits the full security of Ethereum via ZK validity proofs. Every transaction is proven on Ethereum L1 with a mathematically verifiable proof, a process which happens quickly and doesn’t rely on economic incentives or any human action.
Polygon technology already has the fastest deterministic finality of any L2. And core Polygon developers are on track to build a type-1 zkEVM, which means the greatest possible compatibility–including in terms of security–with Ethereum while still retaining the scaling advantages of an L2.
Building on Polygon CDK would allow Celo to harness all of these benefits.
cLabs cites unchanged, low gas fees as essential in deploying an L2 validium. Not only does Polygon CDK offer an off-chain data availability solution for ZK-powered L2s running in validium mode, but by joining a shared ZK bridge, Celo developers and users would see fees that are magnitudes lower, as proof verification on L1 is amortized across all chains. Relative to the fees for transacting on Celo today, transaction fees as an Ethereum L2 built with Polygon CDK are anticipated to be on-par based on settlement time and transaction volume. The higher the transaction volume the cheaper the overall fees are due to amortization.
Value Propositions Specific to Polygon CDK
One of the biggest reasons to become an Ethereum L2 is to gain access to as much liquidity as possible. Polygon CDK gives a ZK-powered Celo L2 seamless access to deep liquidity.
Joining the Polygon ecosystem means access to over $23 billion in shared liquidity across all Polygon chains and Ethereum itself. Every chain in the Polygon ecosystem shares automatic access to the liquidity of the ecosystem–and of course, via ZK validity proofs, with Ethereum. As a result, users and developers can seamlessly transact or move across chains.
The deeper the pool of liquidity, the more opportunities for developers and users to harness and create value across all use cases.
In the above proposal to move to an L2, cLabs indicated a divergence from the OP stack in the following ways:
- Decentralized sequencer
- Off-chain data availability layer
- A design that retains Celo’s 1-block finality
Point by point, Polygon CDK allows for out-of-the-box customization of each of the above parameters.
A ZK-powered L2 Celo chain could be deployed with a decentralized sequencer that uses existing Celo validators, widely configurable data availability solutions, and customization for block finality and the time it takes to post ZK proofs of the chain state to Ethereum. Such a ZK L2 would be natively interoperable with all other Polygon CDK chains. This means growing access to expanded Ethereum blockspace, all connected to a shared ZK bridge that allows near-instant cross-chain activity and access to shared liquidity.
ZK proofs offer the fastest deterministic finality of any rollup design, and, should Celo go forward with this proposal, its community would have access to the fastest finality among ZK rollups. Deterministic finality is how long it takes for a user to withdraw their funds on the L1. This is distinct from transaction finality, which is when a user sees that their balance has changed. With fraud proofs, reaching deterministic finality requires waiting the seven-day challenge window. Other ZK rollups live on Ethereum take at least 21 hours to reach deterministic finality. Currently with Polygon CDK, chains will experience 1 hour or less to reach deterministic finality. Current improvements are being made as we speak to improve finality times.
As it is today, Polygon CDK technology is orders of magnitudes faster; future optimizations to the prover are expected to reduce this even further.
The ability to reach deterministic finality this quickly is a reflection of the technical advantages of ZK proofs, generally, and the soundness of Polygon proving technology, specifically.
In keeping with Celo’s stated desire to work more closely across the Ethereum community, Polygon Labs will provide a set of trusted implementation partners to assist Celo core devs to develop, test, and deploy a CDK Chain to best fit their required specifications. Similarly, Polygon Labs developers will aid in these conversations to ensure proper support is given. Polygon Labs developers have significant experience helping projects deploy L2s and would be eager to help.
Proposed Upgrade for Celo using Polygon CDK
The following diagram is one proposed design for Celo, in keeping with the stated requirements of:
- Decentralized sequencer
- Validium mode
- Third-party data availability solution
Additionally, future upgrades to the type of proving system (type-1, for instance) could be integrated into chain design.
Potential Effects on the Celo Community
In following with cLabs’ above proposal, Polygon Labs has identified the potential effects on various stakeholders across the Celo community.
- Validators
Change – The Polygon CDK offers L2s the ability to deploy in rollup or validium mode. Both configurations would allow for the participation of the current Celo validators, and would require validators to run or have access to a trusted full Ethereum node. In validium mode, validators would act as a data availability committee, responsible for maintenance and storage of transaction data. In rollup mode, Celo validators would act as sequencers. While decentralized sequencing is on the roadmap for Polygon CDK, current Celo validators would continue to play an important role in the health of the Celo ecosystem regardless of the implementation.
- Developers
Change – Developers will not experience any changes to what Celo currently offers, but rather see important improvements. Polygon CDK is EVM-equivalent, meaning any tooling (including auditing and debugging tools) that works with Ethereum, works with Polygon CDK. The upside for developers is at the heart of this proposal: an EVM-equivalent Ethereum L2 maximizes the network effects of Ethereum alignment. Meaningful steps have been taken to develop a forced-transaction mechanism from L2 to L1.
- Users
No change – Even in rollup mode, changes in transaction fees with Polygon CDK are expected to be relatively trivial. (As a point of reference, per-tx cost on Polygon zkEVM for an ETH transfer is ~$0.01.) By choosing to deploy in validium mode, a ZK-powered Celo L2 would see a significant reduction in fees. Furthermore, proof generation to Ethereum L1 is amortized across all ZK L2s deployed using Polygon CDK.
- Holders of CELO
No change – CELO will continue to be the token governing the Celo ecosystem. CELO holders will still control both the core smart contracts that control the protocols, according to Celo’s governance model, and the validator set. Additionally, CELO would continue to be the native gas token for transaction fees in the Celo ecosystem.
Summary
cLabs has highlighted a number of value propositions for upgrading to an Ethereum L2. Wth the expanded above proposal, Polygon Labs hopes that the Celo community will begin to discuss how deploying a ZK L2 using Polygon CDK can meet and surpass the original value propositions outlined by cLabs for a proposed Celo upgrade to an Ethereum L2.
We look forward to continuing this dialogue with the Celo community.
