Taiko: Scaling Ethereum in a Decentralised Manner - Joaquin Mendes
May 7, 2025
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Joaquin Mendes, the COO of Taiko and a Web3 innovator, shares insights into Taiko's decentralized, Ethereum-equivalent rollup solution. He discusses the challenges of scaling Ethereum using ZK technology while maintaining security. Joaquin dives into the trade-offs of base sequencing and user experience, the evolution of zkEVM technology, and the vibrant ecosystem of decentralized applications on Taiko. He also addresses potential future impacts on Ethereum from upcoming upgrades and innovative strategies to enhance transaction processing.
Taiko aims to scale Ethereum efficiently while prioritizing security and decentralization through its type I zkEVM rollup solution.
The base sequencing system enhances decentralization by enabling layer one validators to conduct transaction ordering, promoting open participation in the ecosystem.
Taiko's focus on miner extractable value (MEV) distribution emphasizes fairness and ecosystem support by allowing layer one validators to capture MEV opportunities.
Deep dives
Ethereum's Potential for Scalability
The discussion emphasizes that Ethereum has just begun to realize its scalability potential, with only about 1% of expected usage currently being tapped. The vision presented suggests that Ethereum could function like the new internet, requiring substantial scalability on both layer one and layer two to handle future demand. As more decentralized applications leverage Ethereum's blockchain, the need for improved scalability will become increasingly critical. This perspective reinforces the belief that innovations like rollups are essential for accommodating anticipated growth.
Base Sequencing Explained
Base sequencing distinguishes itself by allowing transaction ordering to be conducted by layer one validators instead of a centralized entity. This method enhances decentralization and promotes permissionless participation, allowing various validators to engage in sequencing transactions on layer two. While this approach could limit profitability due to higher operational costs, it aims to maintain a fair and open environment for transaction processing. The trade-offs in this model highlight important considerations regarding the balance between decentralization and profitability in Ethereum's evolving landscape.
The Role and Challenges of Type 1 ZKEVM
The Type 1 ZKEVM approach focuses on achieving the highest compatibility with Ethereum, translating opcodes without significant performance sacrifices. While this compatibility allows developers to switch over to Tyco without altering existing code, achieving this level of equivalence poses significant technical challenges. The podcast reveals that while various zkEVM solutions exist, creating a system that aligns closely with Ethereum has been tedious due to the complexity of the execution environment. In essence, the balance between performance and compatibility remains a key technical hurdle for evolving rollup technologies.
MEV and Its Distribution
The podcast delineates the concept of MEV (Miner Extractable Value) capture peculiar to Tyco's architecture, as it does not extract MEV itself, leaving that opportunity to layer one validators. While this decision could make profit generation harder for Tyco, it aims to support a healthier ecosystem by contributing to layer one validators. This revenue-sharing mechanism fortifies Ethereum's value while facilitating more decentralized and fair transaction environments. The approach reflects a broader philosophy of maintaining market integrity and fairness in value extraction across different layers.
The Future Vision and Ecosystem Growth
As Tyco anticipates significant advancements, the advent of base pre-confirmations is viewed as a transformative development that could address current UX hurdles. By facilitating instant transaction confirmations, these innovations are expected to enhance user experience while attracting layer one validators back to Tyco’s platform. The ongoing growth of Tyco’s ecosystem, which presently hosts around 140 applications focused on DeFi and gaming, is further supported through initiatives like Tyco Takeoff that aim to accelerate select projects. This strategic vision for growth underscores Tyco's commitment to establishing a robust infrastructure for diverse applications and long-term sustainability.
Taiko is a decentralized, Ethereum-equivalent (type I) rollup scaling solution which uses ZK technology. Taiko's goal is to scale Ethereum efficiently while maintaining security and decentralization. Being a type I zkEVM, Taiko retains full Ethereum equivalence, which creates a seamless DevEx, although this comes at the expense of UX as slower proof generation is the main trade-off. Moreover, in order to stay true to its decentralised ethos, Taiko operates as a based rollup, meaning that transaction sequencing is performed by L1 validators.
Gnosis: Gnosis builds decentralized infrastructure for the Ethereum ecosystem, since 2015. This year marks the launch of Gnosis Pay— the world's first Decentralized Payment Network. Get started today at - gnosis.io
Chorus One: one of the largest node operators worldwide, trusted by 175,000+ accounts across more than 60 networks, Chorus One combines institutional-grade security with the highest yields at - chorus.one
This episode is hosted by Friederike Ernst.
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