Decentralized liquidity protocol Aave has been deployed on Metis, an Ethereum layer 2 scaling platform, bringing a host of decentralized finance (DeFi) features and products to its ecosystem.
The community recently voted in favor of a proposal to be deployed on the zero-knowledge Ethereum Virtual Machine (zkEVM) platform zkSync Era, paving the way for DeFi protocols to leverage the powerful performance improvements offered by scalable infrastructure.
Ethereum ecosystem participants are developing a number of different zk-proof-powered layer-2 protocols, providing developers with infrastructure choices to scale their respective platforms. While Aave has not yet deployed on zkSync Era, it has announced the deployment of v3 of its protocol on Optimistic Rollup scaling protocol Metis. The latest version of the Aave protocol is touted to benefit users of both protocols, and Metis users will benefit from the DeFi lending services offered.
Ethereum.org highlights the main differences between Optimistic Rollups and zk-Rollups. The former processes off-chain transactions before publishing data on-chain and provides a time frame for network participants to challenge the validity of transaction data. At the same time, Z k -Rollups use a single proof of validity to execute transactions off-chain and submit large batches of transactions on-chain, without requiring the network to validate data.
The Metis team highlighted a number of ways its ecosystem users could benefit from an Aave deployment. This includes borrowing assets with less collateral through Aave's "efficient" model, improved risk management through supply and borrowing caps, and siled lending to reduce the risk of potential market contagion. Aave's “segregated” model also increases collateral asset pools, its cross-chain portal provides access to a wider range of DeFi solutions, and its gas optimization reduces transaction fees. Aave has a solid reputation in the DeFi space, with over $5.5 billion in total value locked in the protocol. V3 of the DeFi liquidity protocol was deployed on Ethereum's mainnet in January 2023, following its launch on many Ethereum layer 2 protocols, including Avalanche, Arbitrum (ARB), Optimism (OP) and Polygon
matic.
Another well-known DeFi player, 1inch Network, also chose zkSync to deploy its aggregation and limit order protocol, while Uniswap, united nations university. In April 2023, token holders voted in favor of deploying Polygon's zkEVM rollup solution.
