In May 2022, Vitalik Buterin stated that “truly acceptable” fees in Layer 2 solutions should not exceed $0.05. At the time of the tweet, only the project Metis met this target.
A year later the platform still offers users samye nizkie komissy on the market. We discuss Layer 2 solutions on Ethereum, the Metis ecosystem, and the development of a project that will combine the advantages of rollups and ZK-rollups.
What Layer 2 is for Ethereum
The second layer (Layer 2, L2) is a protocol built atop the main blockchain (Layer 1) to boost its scalability. The main scaling solution for Ethereum is the technology rollups.
Rollups are separate networks that aggregate (roll up) hundreds of transactions into one. They share the Ethereum fee among participants in rollup transactions and record information about their actions on the parent blockchain.
This approach reduces the cost of sending tokens and interacting with dapps by several times: at the time of writing the average Ethereum fee составляет $1.20, and in Metis — less than $0.01.
There are two types of rollups depending on how transactions are posted to the main blockchain:
- Optimistic. Treats transactions as confirmed unless fraud proofs exist. The solution can be challenged within a week after submission to L1;
- Zero-knowledge (ZK). Generates cryptographic proofs of transaction validity (validity proofs).
According to L2BEAT, at the time of publication there were 21 Layer 2 solutions built on Ethereum with a total TVL above $9 billion.
The leaders include Arbitrum One, Optimism and Metis, which use Optimistic Rollups, as well as dYdX and Immutable X on the basis of ZK-Rollups.
However, Metis says the project will soon move to a new architecture — Hybrid Rollups.
What Hybrid Rollups are and their advantages
A Hybrid Rollup is an architecture that combines the scalability of Optimistic Rollups with the security and fast data processing of Zero-Knowledge Rollups. The concept of Hybrid Rollups was presented by Metis developers in March 2023.
After implementing Hybrid Rollups, Metis will support:
- EVM-equivalent smart-contract development by preserving the Optimistic Rollups architecture;
- higher throughput by using zero-knowledge proofs;
- finalisation of transactions in Ethereum within four hours instead of seven days.
The Metis team is still working on implementing Hybrid Rollups and plans to launch them in the near future.
What is Metis
Metis is an L2 platform for scaling Ethereum and deploying smart contracts on the Andromeda network.
The project was founded by Elena Sinelnikova, Yuan Su and Kevin Liu in 2020. The main Metis network — Andromeda — launched in 2021 as a fork of the Optimism blockchain.
In the same year the firm established Genesi DAC, a venture fund focused on Metis-based projects. It was led by Vitalik Buterin’s mother, Natalia Amelin.
As of this writing the Metis ecosystem includes:
- Metis Bridge — a bridge for transferring tokens between Ethereum and Andromeda;
- Andromeda Explorer — an explorer for the Andromeda network and the Goerli testnet;
- Metis Oracles — an oracle system for delivering off-chain data to Andromeda and Ethereum;
- Metis Nodes — a collection of L2-nodes for storing and processing transactions on the Metis network;
- Metis Graph — a protocol for optimising data search and storage in Andromeda, enhancing dapps efficiency and speed;
- MetisDAO Foundation — a decentralized autonomous company focused on supporting projects and DAC in Andromeda.
A key part of the ecosystem is the native Metis token (METIS), which can be used for staking and paying transaction fees on the Andromeda network. At the time of publication it is traded above $27.
DAC and dapps built on Metis
The project positions itself as a DAC-centric platform building solutions for the Web3 economy. Metis’s three-tier governance structure includes:
- DAC — a person or group of people who represent their business in the blockchain. Each user can form a DAC or join an existing DAC.
- Commons — platform citizens who receive governance tokens veMetis in exchange for staking METIS;
- EcoNodes — Metis citizens who provide services to platform users. To become an EcoNode, one must obtain approval from MetisDAO Foundation and other EcoNodes.
The development of the infrastructure for decentralized autonomous companies in Metis is handled by EcoNode Koris.
“The Koris team awards DAC-pioneer grants and collaborates with decentralized autonomous companies. In just a month of operation the EcoNode received nearly 50 applications from various organizations and approved 30 of them,” says Metis co-founder Elena Sinelnikova.
As of publication, Andromeda has launched 20 dapps and 13 DeFi projects, including:
- SushiSwap — a decentralized exchange;
- DEX-aggregator Hera Finance;
- multichain wallet FoxWallet;
- educational blockchain project CryptoChicks.
Also the MetisDAO Foundation is working on deploying the lending DeFi protocol Aave in Andromeda. The project team regularly publishes news about Metis ecosystem development on the Telegram channel Telegram and other social networks.
Test Metis: adding Andromeda to MetaMask
We decided to test the solution by sending ETH to Andromeda, swapping it for Metis, and then withdrawing to Ethereum.
To do this, add the Metis Andromeda network in MetaMask: go to wallet settings, select “Networks”, click the “Add Network” button and fill in the fields:
- Network name — Metis Andromeda;
- New RPC URL — https://andromeda.metis.io/?owner=1088;
- Chain ID — 1088;
- Currency symbol — METIS;
- Block Explorer URL — https://andromeda-explorer.metis.io/.
Then click “Save”.
The second, easier method is to use the service Chainlist. To add the network, click Connect Wallet, type “Metis Andromeda Mainnet” in the search box and approve the action in MetaMask.
Buying Metis
To pay for transactions in Andromeda you need to acquire Metis, which is traded on Coinbase, OKX, KuCoin and others CEX and DEX.
We bought the token on the centralized KuCoin exchange and paid 0.01 METIS ($0.26) for a withdrawal to an address on the Andromeda network. In January the platform paused withdrawals on L2, so before purchasing the token it is worth checking the availability of such operations.
At the time of writing, the fee to buy Metis on the DEX aggregator 1inch was 0.0057 ETH ($10). In addition, you must also pay for the transfer from Ethereum to Andromeda.
Looking ahead, note that it is better to acquire at least 1 METIS — that is the amount required to withdraw assets from Andromeda back to Ethereum.
Transferring assets between Andromeda and Ethereum
After purchase we went to the Metis Bridge site and connected MetaMask by clicking Wallet Connect. However, you can also send tokens to Andromeda using eight other bridges that support Ethereum and other networks.
Then we transferred 0.01 ETH to the Andromeda network, paying 0.00281 ETH ($5.12) for the transaction.
During the transfer, Metis Bridge automatically converts Ether into Wrapped Ether (WETH). The transfer history is saved in the Transaction History section.
Next, we swapped 0.01 WETH for 0.65 METIS via the DEX aggregator Hera Finance. The operation fee was 0.02 METIS ($0.75).
As the test concludes, we initiated withdrawal of 0.09 ETH back to Ethereum. It cost us 1.026 METIS ($0.70).
For transferring Metis tokens to KuCoin we paid 0.000273 METIS ($0.006).
The wait for the transfer from Metis to Ethereum took seven days, as with other Optimistic Rollups-based solutions.
Conclusions
Metis is in the Top 10 of Layer 2 solutions by TVL, with a figure of $128 million. The project token trades on popular exchanges, and fees on Andromeda remain among the lowest on the market — $0.01 and below.
Today, Metis is developing its own Hybrid Rollups technology, which could unite the scalability of Optimistic Rollups with the security of ZK-Rollups, and may become the leading protocol for Layer 2 solutions on Ethereum.