Ethereum Rollup Hermez Network, to Be Used by Tether, Goes Live

Ethereum Rollup Hermez Network, to Be Used by Tether, Goes Live

Hermez Network – a layer 2 throughput solution for moving tokens and ether on the cheap – is now live on the Ethereum mainnet.

The network – which will be used by stablecoin giant Tether – will initially support five assets including ether, wrapped bitcoin, dai, tether and the hermez token, the team said in a press release. Support for more assets will be added in the coming months.

“As exorbitant gas fees continue to cripple the community, we must bring scalability and cheaper transactions to Ethereum now,” Hermez tech lead Jordi Baylina said in a statement. “We are now inviting developers, projects and users from around the world to join us on this journey towards a significantly cheaper and decentralized future.”

Rollups: Easing transaction bottlenecks on Ethereum

Rollups are quickly becoming the preferred solution for Ethereum’s transaction bottleneck problem, both in the zero knowledge proof (zk-rollup) and Optimistic rollup (ORU) flavors. A recent rise in user activity spiked gas prices throughout the early winter months, prompting a move to rollups.

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These throughput tools increase how many transactions can be settled on the Ethereum blockchain by moving transactions off-chain, bundling them and sending them back to Ethereum for settlement. Andreessen Horowitz-backed Optimism and Union Square Ventures-backed Matter Labs are the industry’s two heavyweights in the field.

Hermez itself is a zk-rollup, meaning it uses mathematical proofs to verify and settle transactions.

Who Created the Ethereum Ecosystem?

Vitalik Buterin, a Russian-Canadian entrepreneur and programmer from Toronto, envisioned second-largest cryptocurrency Ethereum when he was 19 years old.

In 2011, the year Buterin first grew interested in Bitcoin, Buterin co-founded the online news website Bitcoin Magazine, writing hundreds of articles on the cryptocurrency world. He went on to code for the privacy-minded Dark Wallet and the marketplace Egora.

Along this journey, he came up with the idea for the Ethereum ecosystem, a platform inspired by Bitcoin that could go beyond the financial use cases.

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He released a white paper in 2013 describing an alternative platform designed for any type of decentralized application developers would want to build. Many developers were drawn to this idea of creating decentralized applications because they would be accessible to a global audience, be free from censorship and would give users more control over their data than most apps, which have intermediaries in the middle managing users’ finances and data.

To accomplish this, Ethereum makes it easy to create smart contracts, or code that automatically creates an outcome when certain conditions are met. For his work, Buterin was named a 2014 Thiel fellow, winning a $100,000 grant to work on Ethereum.

Buterin FAQs

Who helped Buterin create Ethereum?

After Buterin unveiled the Ethereum white paper, several other developers joined the ranks including CEO of IOG Charles Hoskinson, Decentral CEO Anthony Di Iorio and Akasha Founder Mihai Alisie. Buterin also introduced two new co-founders to the team:

Co-founder Dr. Gavin Wood did much of the early programming and architecting of the platform. He wrote the Ethereum yellow paper, the “technical bible” that outlines the specification for the Ethereum Virtual Machine (EVM), which is responsible for handling the state of the ledger and runs smart contracts.

Co-founder Joseph Lubin went on to found the Brooklyn-based ConsenSys, a startup that focuses on building decentralized apps.

How much money does Buterin have?

Since Ethereum data and transaction information is public, users can track how much money Buterin has stored in ether, Ethereum’s native token.

Buterin’s main address is this one, which shows that he owns 333,348 ether, worth approximately $568 million at the time this article was published.

What was Ethereum like in its early days?

To get the project off the ground, Buterin and the other founders launched a crowdfunding campaign in July 2014 where participants purchased ether, the Ethereum tokens that function as shares in the project.

Raising more than $18 million, it was the most successful crowd sale at that time. It took another year, but the first live release, Frontier, launched on 30th July, 2015. It wasn’t a particularly attractive platform, but the command line interface offered developers a platform for creating their own decentralized apps.

The smart contract platform took off, swelling into today’s ecosystem of hundreds of developers and even drawing the attention of tech giants like IBM and Microsoft.

Ethereum Layer 2 network Hermez that uses ZK-Rollups has gone live

Ethereum Layer 2 scaling solution Hermez Network that uses ZK-Rollups technology for scalability has gone live.

The development means Hermez’s mainnet has been launched, and users can now make transfers at lower gas costs.

“People should save around 90% of gas costs,” Hermez’s tech lead Jordi Baylina told The Block.

The current average gas fee is about $16 per transaction. With around 90% savings, the cost would come down to about $1.5 per transaction.

Besides lower fees, Hermez also has a higher throughput than Ethereum, i.e., it can process more transactions per second. Ethereum’s current throughput is about 15 transactions per second. Baylina said Hermez can multiply the capacity of Ethereum by 100 times.

Hermez uses ZK-Rollups for scalability. They help bundle hundreds of transfers into a single transaction, thereby reducing data storage and gas fees for validating transactions.

Ethereum creator Vitalik Buterin recently said that ZK-Rollups “will win out in all use cases” in the medium to long term as ZK-SNARK technology improves.

As for Optimistic Rollups, Buterin said they are likely to win in the short term for general-purpose computation. At the same time, ZK-Rollups are likely to win out for simple payments and other application-specific use cases, he said.

One of the first projects to integrate with Hermez is Tether, as The Bock reported earlier this year. With Hermez’s mainnet launch, Tether’s USDT stablecoin is available on the network.

Besides USDT, Hermez is initially also supporting ether (ETH), wrapped bitcoin (WBTC), Dai (DAI), and Hermez token (HEZ). That means anyone using these tokens can now use the Hermez network to make transfers.

“We will add many other tokens very soon,” Baylina told The Block. “Hermez is open to any ERC20 token.”

Hermez also expects “many exchanges and wallets” to integrate with the network “very soon,” he said.

While Hermez’s mainnet has launched, there is still a lot of work to do, said Baylina. That includes making Hermez “fully decentralized.”

Baylina said Hermez is now non-custodial but still has some centralization points. “During the upcoming weeks, we need to fine-tune some parameters, and we hope to have very soon a fully decentralized governance less system,” he said.