State Cost Reduced by 5200x Can ZK Compression Make Solana Outperform Ethereum

CoinWorld reported:
Author: Luccy
Last week, Solana launched a new technology called “ZK Compression,” which is said to reduce the state cost of Solana and improve its network scalability without relying on L2. This is like a slap in the face of Ethereum, saying “I won” in three words.
Anatoly Yakovenko, co-founder of Solana, also emphasized that “all execution happens on L1 and is ordered by L1 validators.” Justin Bons, founder and CIO of Cyber Capital, believes that “this clearly puts Solana far ahead of ETH in terms of actual L1 scalability, solving one of Solana’s biggest survival problems.”


Did Ethereum’s defense break?
The blockchain faces the “trilemma” of decentralization, security, and scalability. While maintaining the first two, Ethereum outsourced its execution layer business to L2 in order to improve scalability.
From the initial plasma to the current rollup, L2 has indeed solved Ethereum’s scalability problem, making Ethereum the “asset for everything.” However, this choice has brought unexpected chaos to Ethereum. With the fragmentation of L2, Ethereum’s ability to capture value has gradually weakened. On June 29th, the gas fee on the Ethereum mainnet even dropped to 1 Gwei.
Recently, the debate between Ethereum and Solana also focused on L2. It can be said that the L2 solution is a gamble for Ethereum. However, Solana has solved this dilemma, and Ethereum’s believers naturally cannot easily accept this reality, questioning the “L1 nature” of ZK Compression.
In Ethereum’s L2 solutions, Validium’s mechanism is similar to zkRollup. All transaction validity is enforced using zero-knowledge proofs. The main difference is that in zkRollup, data availability is on-chain, while Validium remains off-chain.
Because of this, when Mert Mumtaz, CEO of Solana’s ecosystem development platform Helius, stated that ZK Compression keeps the data off-chain, the Ethereum community viewed it as validium. Adam Cochran, a partner at CEHV, firmly stated that ZK Compression is Solana’s L2 solution, and he believes that “one day, the Solana community will realize that what they are building is a good rollup based on L2 functionality/effectiveness, not a complete chain.”
Even though Anatoly emphasized that “all execution happens on L1 and is ordered by L1 validators,” Adam still insists that ZK Compression cannot be L1.


The Solana community responded with a meme, mocking Ethereum’s followers for not conducting serious research but claiming to be experts. Mert even jokingly named ZK Compression “ZK validium.”


Solana’s airdrop cost reduced by 5200 times
ZK Compression is a blockchain scaling solution jointly launched by Solana’s ecosystem development platform Helius and Solana’s privacy project Light Protocol. According to Mert Mumtazt, CEO of Helius, ZK Compression will directly operate on L1 without the need for L2, which will greatly enhance Solana’s network scalability and “move towards building a unstoppable, global, light-speed synchronized atomic state machine.”
According to the ZK Compression document, this technology is a new primitive built on Solana that allows developers to build applications on a large scale. Developers and users can choose to compress their on-chain states, reducing the state cost by several orders of magnitude while maintaining the security, performance, and composability of Solana L1.
ZK Compression works through a process called state compression, allowing developers to use cheaper ledger space on Solana instead of more expensive account space to store certain types of data. The “hash” or “fingerprint” of off-chain data is stored on-chain for verification using “sparse state trees.”
A purely technical explanation may be too complex. Simply put, this technology reduces Solana’s state cost.
In Solana, technicians face two costs – computational cost and state cost. Currently, Solana already has cheap computational power, but state is expensive. Allocating accounts, paying rent, and scaling with users have proven to be huge obstacles for Solana developers, and ZK Compression solves this problem.
Mert used the example of airdrop cost, assuming an airdrop to 1 million users, where the state cost was reduced from over $260,000 to $50, a 5200-fold reduction.
To make the L1 nature of this technology more convincing, Mert called out Ethereum founder Vitalik on Farcaster to comment on the technical principles of ZK Compression. Vitalik responded seriously and stated that this technology seems more like a stateless client architecture.
Vitalik interpreted ZK Compression in three points. First, you have a new account class where only the hash of its state is stored on-chain. Second, to interact with these accounts, you need to write a transaction that specifies the pre-state and post-state hashes of N accounts and provides a validity proof (assuming this means ZK-SNARK). Third, the new state requires public access (this is reasonable; otherwise, you can randomly send someone money that their account cannot access, and you can bypass this to make it a UTxO system, but that would be a significant limitation).
In addition to the interpretation, Vitalik also raised questions about the document, namely the mentioned 128-byte validity proof and whether the public content includes transaction content.
Subsequently, Vitalik expressed confusion again. He believed that the numbers claimed by ZK Compression were like if each verification of SNARK was done individually, the cost would be higher than the cost of performing some small actions and hash operations (such as token transfers). The benefits of ZK rollup come from “one” SNARK wrapping “many” transactions.


However, Vitalik’s questions were not answered, and his initial description of ZK Compression as a “stateless client architecture” has increased the confidence of Solana’s supporters, who believe that this technology is indeed L1.
Will rollup be the perfect companion for Solana?
Solana has always been searching for value for its network. Unlike Bitcoin and Ethereum, the valuation logic of various altcoins that emerged during the last bull market is not entirely the same. Due to cheap block space, it is difficult for their prices to rise significantly. However, Solana continues to focus on compression technology and constantly reduce its own costs, which is a huge challenge for the value appreciation of SOL.
Even considering Moore’s Law and the continuous improvement in hardware performance, and Solana’s optimization for such hardware progress, it does not mean that Solana can meet global demand. However, Solana will manage better than other chains in terms of composability and low latency.
Unlike Ethereum, the Solana mainnet does not intend to become a “B2B chain”; it has always been and will always be a consumer chain. Building a large-scale distributed system is extremely challenging, and Solana has the potential to become the most valuable shared ledger for global transactions.
As for rollup, Solana rollup will be mostly abstracted for end-users.
Ideologically, Ethereum’s rollup is top-down, where the Ethereum Foundation and leaders decide that the best way to scale is through rollup, and then support various Layer2 solutions after the CryptoKitties incident. In Solana, the demand is bottom-up, coming from application developers with significant user adoption. Therefore, most of the current roll-up plays are marketing plays, more driven by narratives than user needs. This is a significant difference that may lead to a different future for Solana’s rollup compared to Ethereum’s.
However, ZK Compression enables Solana to achieve state compression, coupled with Firedancer, multiple concurrent leaders, asynchronous execution, and an ecosystem comprising thousands of developers. These undoubtedly give Solana a real chance in the crypto world.