Matter Labs’ zkSync Era Surpasses $500M TVL

Capital continues to pour into Matter Labs’ zkSync Era, a zero-knowledge (ZK) rollup aimed at scaling Ethereum.

According to data source L2Beat, the total value locked (TVL) on zkSync Era surpassed $500 million on Monday morning, a 12% increase in one week.

TVL is a commonly employed metric for monitoring the entire value of digital assets locked or staked on a decentralized finance platform.

The scaling solution, which maintains Ethereum Virtual Machine (EVM) compatibility while ensuring native account abstraction, is already the third-largest rollup regarding total value locked, following Arbitrum and Optimism.

More than 220,000 ethers (ETH) valued at approximately $378.3 million, about 121 million USDC (a dollar-pegged stablecoin), and 14.43 million MUTE valued at $7.53 million were sealed on zkSync at the time of publication.

MUTE is the native cryptocurrency of Mute, a decentralized exchange founded on zkRollup.

Since May, the average number of daily active addresses has increased to 175,000 over the past four weeks. The release of zkSync occurred in March 2023.

Rocketpool recently went live on zkSync Era, joining the growing list of decentralized applications migrating to layer 2 platforms.

According to Galaxy Digital, the increased user demand for rollups is likely due to the concentration of Ethereum core developers on implementing the Ethereum Improvement Proposal (EIP) 4844.

The EIP 4844 will add a new transaction type to Ethereum that accepts “blobs” of data and reduces rollup transaction fees.

The prioritization of EIP 4844 as the following significant code change in Ethereum’s upcoming Cancun/Deneb upgrade confirms the importance of rollups for Ethereum’s long-term scalability and the need for dapps built on Ethereum to eventually migrate the majority of their operations to a more cost-effective rollup, according to a June 2 newsletter from Galaxy Digital.

Notably, activity on other ZK rollups, such as Starknet and Polygon zkEVM, is also robust. Some analysts predict a Zk season, which is crypto market slang for a period in which ZK rollups significantly outpace other market sectors.