• Layer-2 solutions are solutions which have an important place in Ethereum roadmap and enable Ethereum to scale together with Sharding.
  • Aztec Network is a Layer-2 solution, utilizing zero knowledge proofs, built on top of Ethereum mainnet.
  • Aztec Network allows its users to make privacy-enabled payments and DeFi transactions with low fees.

Recently, it has become quite a common false assumption that the transaction fees will decrease on Ethereum after the Merge. However, the Merge will have nothing to do with the transaction fees. Merge only indicates the transition of the validation method from PoW (Proof of Work) to PoS (Proof of Stake). For further information about the Merge, you can read our report titled “The Recent Updates on Ethereum’s Merge“.

Decrease in transaction fees on Ethereum will actually take place when Sharding is active along with Rollups. Rollups are critical because Ethereum adopted the Rollup-Centric Roadmap in 2020. As such, Ethereum later changed its Sharding plans to include Rollups as well. The goal to create extra data fields for Rollups to utilize in Ethereum blocks with Proto-Danksharding (EIP-4844) is a good example for this change. The delay of The Merge and Ethereum’s integration of Rollups into the roadmap resulted in postponing the launch of Sharding to 2023.

Rollups and other Layer-2 solutions will contribute to Ethereum’s scaling until Sharding is eventually live. With the emergence of first operational Rollups in 2021, Layer-2 solutions have begun to attract the attention of the ecosystem. Rollups distribute the transaction fees among the shareholders by creating a batch of hundreds of transactions and can reduce transaction fees by down to 100 times. Following this approach, Aztec Network offers lower transaction fees, high speed and privacy compared to the mainnet.