EVM Native Rollups: The Path to Enhanced Security and Interoperability in Crypto

The crypto world is witnessing a significant shift towards EVM (Ethereum Virtual Machine) native rollups, driven by compelling incentives and the promise of improved security and interoperability. As the industry evolves, the choice between becoming an EVM native rollup or sticking with other virtual machines like Cairo or WASM is becoming crucial for layer 2 solutions. This article delves into the motivations behind this trend, the potential benefits, and what it could mean for the future of cryptocurrency.

Incentives for Becoming an EVM Native Rollup

The primary incentive for layer 2 solutions to transition to EVM native rollups is the promise of enhanced security. According to Umar, a prominent figure in the crypto space, becoming a native rollup can dramatically improve security, which in turn has significant downstream effects on Total Value Locked (TVL). Currently, less than 10% of all assets are on these rollups, a figure that should ideally be close to 100%. The potential for bugs and the vulnerability to security councils that can drain a rollup overnight are major concerns that EVM native rollups aim to address.

The recent BYBIT hack, which utilized safe infrastructure similar to the mechanisms used by security councils, underscores the urgency of this shift. Interestingly, the hack targeted BYBIT, which has a TVL of $1.5 billion, while rollups hold up to $10 billion. This disparity highlights the potential risks and the need for stronger defense mechanisms, which EVM native rollups can provide.

Interoperability and Network Effects

Another key advantage of EVM native rollups is the ability to benefit from shared composability and network effects. For existing ecosystems like Base, which already have significant network effects, the motivation to become a native rollup is clear. By doing so, they can tap into the broader Ethereum ecosystem, enhancing their interoperability and ultimately their value proposition to users.

However, for non-EVM based solutions, such as those using Move or other languages, the path to interoperability is more challenging. These solutions do not enjoy the same benefits of shared security and composability, which can limit their growth and adoption. While some virtual machines like Cairo or WASM offer simplicity and the potential for formal verification, they lack the dynamic nature of the EVM, which is regularly updated and adapted to meet the evolving needs of the crypto space.

The Future of Rollups and Crypto Security

As the crypto industry continues to mature, the focus on security and interoperability is likely to intensify. EVM native rollups represent a significant step forward in addressing these critical issues. Market analysts predict that as more layer 2 solutions transition to EVM native rollups, we could see a substantial increase in TVL, potentially reaching 90% to 100% of all assets on these platforms.

Expert opinions on this trend are overwhelmingly positive. Many believe that the shift to EVM native rollups will not only enhance security but also pave the way for greater adoption of cryptocurrencies. The potential for strong property rights, a cornerstone of successful crypto ecosystems like Bitcoin, is seen as a major driver of this trend.

Looking ahead, the crypto community is keenly watching how these developments will unfold. The success of EVM native rollups could herald a new era of security and interoperability, setting the stage for the next wave of innovation in the crypto space. As the industry continues to evolve, the incentives for becoming an EVM native rollup are likely to grow, shaping the future of cryptocurrency in profound ways.