Joining Aztec to Bring Scalable Privacy to Ethereum
Earlier this summer, I wrote about why I was jumping into crypto full-time. I’m excited to share that I joined Aztec, which is bringing scalable privacy to Ethereum. I’m leading our efforts to partner with developers in the Ethereum ecosystem, decentralize the network, and build our team (on that note, we’re hiring). In this post, I’ll explain why I’m so bullish on Aztec.
Mission: Increase Crypto Adoption
My overall mission is to increase crypto accessibility and adoption. I was drawn to the infrastructure layer. I wanted to work on a project that provides developers with the tools needed to build applications that bring more of our financial and digital lives on chain.
The reality is that all of the successful dapps today are successful in spite of many existing challenges and limitations. Even the most intuitive user interface cannot convince a typical user to spend $100 in fees to transact on the congested Ethereum network. Improving infrastructure is crucial to reduce barriers for consumers and institutions to transact on chain.
High Impact = High Leverage
The highest leverage opportunity to grow crypto is to address this issue, known as scalability. Scalability first entered public discourse when thousands of users collected Cryptokitties (a digital cat NFT) in 2017. The Ethereum network got congested and drove up the network fee to $100+ per transaction. This was an obvious blocker for mainstream adoption. Since then, brilliant technical minds have been working on improving the throughput and cost of transacting on the Ethereum network. After years in R&D, several of these “Layer 2” solutions are launching in 2021.
While they are offering big improvements, there are also notable limitations. You can think of them as separate networks that settle to the Ethereum network. Developers have to relaunch their applications and rebuild the liquidity on the new network. They also need to maintain separate infrastructure for each network to power their applications. Users have to move their funds to the new network and can only interact with apps that are deployed on that network. Vitalik captures the benefits and tradeoffs of these approaches here.
Scalability on Layer 1
Enter Aztec.
Aztec rollups are distinct in that they transact directly with smart contracts on Ethereum mainnet. Developers do not need to relaunch or rebuild any aspect of their application on Aztec’s network. Nor do they have to rebuild liquidity. From day 1, users of Aztec can interact with the tens of thousands of apps on Ethereum’s mainnet — with the same security guarantees.
Users can include their transaction in an Aztec rollup, which aggregates transactions across many users and splits the network fees across the transactions in the rollup. This can result in 100x gas savings for users. All of these transactions are private, so users do not have their identity nor the details of their transaction revealed, as they would with any other solution.
As with all scalability solutions, this comes with tradeoffs. For now, each rollup can accept a limited number of assets and DeFi interactions. Additionally, gas savings are directly correlated with the number of transactions in the rollups. Meaning the more users that add their transactions to an Aztec rollup, the cheaper the transaction fee will be for each of those users. This is a classic network effect — the more users, the better the service. Aztec has to build this network effect through integrations for users to fully benefit.
Aztec is releasing integrations to top dapps later this year and will drive transactions to our rollups through our interface, zk.money. Shortly after, we’ll release our SDK, which any developer can leverage to provide users with the option to transact through Aztec’s rollups. Aztec will enable users to transact instantly, cheaply, and privately on mainnet.
Privacy is Table Stakes
Aztec rollups solve the urgent issue of scalability — a pain point felt by all users transacting on Ethereum. But more importantly, we are staking to where the puck is going — privacy.
While crypto is in the zeitgeist, the industry’s penetration is de minimis relative to its potential. New crypto entrants over the last year have mostly been limited to passive investing. As Chris Dixon of a16z described in his presentation, “What Are Blockchains, and What Are They Good for,” most people start with financial exposure. Then they learn more about the underlying technology, followed by imagining business opportunities enabled by this technology.
To some extent, we’ve broken through the perception that speculation is crypto’s primary use case. We’re now building awareness of crypto as a new computing platform. Companies and institutions are exploring how to benefit from this new technology. Soon enough, incumbents will be building new products and services with smart contracts.
Aztec envisions a world where bank accounts, payrolls, and merchant transactions are on chain. Where billions of people are managing their financial lives and millions of companies are conducting business on chain. However, privacy is a prerequisite for these use cases. Privacy tooling will drive the next wave of crypto adoption, and Aztec is best suited to meet the demand.
Aztec is on a mission to grow the crypto ecosystem through private, scalable infrastructure. Today, we offer that through our rollups. With funding from the Ethereum Foundation, we’re also developing Noir, a smart contracting language that will give developers the ability to build applications where privacy is the default. Privacy will be critical for developers to build applications that we can’t fathom today, and we’re excited to see what the community creates.
If you’re also passionate about this mission, we invite you to join our community, follow us on Twitter, or check out open roles on our core team. We look forward to building with you!
