LAYER-2 IMPLEMENTATION IN ETHEREUM NETWORK AS METHOD TO INCREASE ETHEREUM TRANSACTION THROUGHPUT

• Main Author: Abi Daniswara, Hafid
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/77854
• Institution: Institut Teknologi Bandung

Blockchain is a technology for distributed data storage that enables transparent and secure data storage in a chain of blocks, where each block contains a series of transactions and is linked to the previous block through cryptographic hashing. One of the most well-known applications of blockchain is Ethereum. However, Ethereum is currently facing challenges. One of these challenges is its ability to only handle 8-15 transactions per second (TPS). This value is relatively low compared to traditional payment systems like Visa, which can handle thousands of transactions per second. Additionally, with the growth of users and transactions, the network becomes increasingly congested, leading to increased transaction confirmation times and transaction fees. Addressing this issue, this research focuses on an off-chain solution using layer-2 and the ZK-Rollup method. This method allows transactions to be processed on a separate blockchain (off-chain) while still maintaining the same integrity and security as on-chain transactions. It achieves this by aggregating multiple transactions into a single roll-up and verifying them using mathematical calculations known as zero-knowledge computation proofs (ZKP). Evaluation of the implementation results and testing with various scenarios indicates that the ZK-Rollup solution successfully executes transactions and deploys smart contracts, similar to the Ethereum network. Additionally, this solution provides a bridge service to transfer assets from the Ethereum network to layer-2. Testing the implementation also showed improved throughput. However, there are some shortcomings in this final project, such as state synchronization on layer-2 during asset bridging and a few other limitations, for which some suggestions for further development have been included in the concluding section of this final report.