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Cryptocurrency exchange OKX has revealed that it is launching its own zkEVM (zero-knowledge Ethereum Virtual Machine) Layer-2 testnet in partnership with blockchain developer Polygon Labs.
The development sees OKX join a growing list of crypto exchanges building their own Layer-2 networks.
The X1 Layer-2 Network
The OKX-Polygon Labs Collaboration will see the launch of a new Ethereum Layer-2 called X1. The testnet, which was launched today, will use zero-knowledge (ZK) proofs to enable quick and low-cost transactions on a secure network, compatible with Ethereum. The network will mark OKX’s first step towards building and developing its own on-chain environment. OKX’s Chief Innovation Officer, Jason Lau, while talking about X1 and the collaboration with Polygon Labs, stated,
“This scalable and accessible network is perfect for developers who can build on X1 to deliver user-friendly world-class consumer Web3 applications, all while maintaining interoperability with other networks and ecosystems. X1 will be a key pillar of our efforts to educate and bring our users on-chain and into the world of Web3. By collaborating with Polygon Labs, we look to bring more builders, more use cases, and ultimately the mass adoption of Web3.”
The OKB token, the native token for OKX, will be used to pay the gas fees on the fledgling X1 network. The token is a utility token and is currently used to pay trading fees on the exchange. The token also allows users to participate in the OXK platform’s Jumpstart token launch platform and earn rewards on OKX.
X1 hopes to attract developers who can build decentralized applications (dApps) leveraging OKX’s vast user base. OKX is one of the largest centralized exchanges in the world, with assets worth over $12 billion and an active user base of over 50 million users.
Details Of The Collaboration
It is important to note that X1 will be a zero-knowledge rollup solution. Unlike optimistic rollups, these can offer settlements on both Layer-1 and its own network almost instantly. By contrast, optimistic rollups can settle on their own layer instantly, but it takes a few days for the settlement to reflect on the parent Layer-1 chain.
As part of the partnership between OKX and Polygon Labs, OKX will contribute engineering resources to help enhance Polygon’s Chain Development Kit (CDK). CDK is a framework that allows developers to build a custom ZK-powered Layer-2 blockchain on Ethereum.
Other Exchange Launching Layer-2 Networks
The collaboration between OKX and Polygon Labs comes at a time when crypto exchanges are competing with one another to offer users proprietary Layer-2 solutions. Coinbase recently launched its Base Layer-2 network using Optimism’s technology. Meanwhile, cryptocurrency exchange Kraken is also exploring a new scaling solution in partnership with Polygon. While there is considerable hype around Kraken’s potential Layer-2 network, Kraken will choose. However, it is likely to be based on ZK technology.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.