ZenIp: 42400 - Modernizing Horizen Technology via a Modular Proof Verification Layer

Abstract

The objective of this ZenIP is to offer a comprehensive understanding of the “New Horizen” initiative proposed by Horizen Labs, as initially presented on Discourse. This proposal details our driving motives behind creating the system, outlines the strategic approach we plan to adopt, and delves into the technical aspects of its first stage, a modular proof verification layer.

Like any significant technological breakthrough, the “New Horizen” initiative will be rolled out in several stages. However, our immediate priority is to facilitate a decision on whether Horizen Labs should begin the development activities for Phase 1, as detailed below. Comprehensive information regarding the later phases will be presented in a step-by-step manner, aligning with the progression of the development.

In its final form, the “New Horizen” system will encompass two separate blockchains:

1. A Modular Proof Verification Layer: This blockchain will be solely dedicated to the verification of proofs, with the capacity to support any settlement layer. This represents the focus of this proposal.

2. A Modular Settlement Layer: This separate, second blockchain will be exclusively tasked with settling proofs and managing the states of other blockchains. Designed as an alternative to traditional, monolithic chains, its focus is solely on settlement processes, aiming for reduced and more predictable costs. This innovative approach will facilitate the creation of Layer 2 solutions and other networks directly within the Horizen ecosystem.

This ZenIP focuses exclusively on the first point, which entails the establishment of a modular Proof Verification Layer.

Before exploring further details, it is important to address several queries and comments raised by community members on Discourse and Discord:

• Name of the Initiative: The term “New Horizen” is currently a placeholder for the system and its individual component blockchains.

• EON Integration: A key aspect of our development strategy is the integration of EON into the new Proof Verification Chain.

• $ZEN Tokenomics: The modernization process will preserve the balances and tokenomics of $ZEN.

Our proposals to the DAO encompass the following key permission and recognition:

• Branding Authorization: We seek permission to utilize the Horizen name and all associated Horizen trademarks for the branding of technical components like the Proof Verification Layer and the future Settlement Layer.

Motivation

1. To Modernize Horizen Tech To Be Aligned With The Broader Industry While Horizen’s past releases have been ambitious, they often faced challenges due to their complexity. The “New Horizen” initiative is a strategic evolution of these goals, building on the legacy of the Horizen Mainchain and Zendoo.

2. To Future-Proof Horizen Technology And Develop It Based On Market Needs In recent years, Layer 2 solutions (L2s) like optimistic rollups and ZK-Rollups have emerged to address Ethereum’s scaling challenges, gaining significant traction. These innovations have eased some of Ethereum’s load by offloading execution layer tasks. However, their heavy reliance on Ethereum for settlement has paradoxically contributed to the very congestion they sought to alleviate. The growing popularity of L2s not only highlights the evolving demands of the blockchain space but also underscores the limitations of their dependence on monolithic chains like Ethereum for settlement tasks.

The rise of L2s and the challenge posed by their reliance on Ethereum for Data Availability (DA) have led to the development of solutions that separate DA from the other settlement functions. This move towards greater modularization in the blockchain architecture presents a unique opportunity for Horizen. We propose to capitalize on this trend by building a Proof Verification network that is both proof and settlement layer agnostic. This is akin to how DA solutions carved out a new layer by isolating a function traditionally seen as part of settlement, and we envision a similar approach by creating a chain optimized specifically for Proof Verification.

Our proposed dedicated Proof Verification Layer aims to substantially reduce security costs for L2s, particularly ZK-Rollups, as well as for any applications that generate proofs. This initiative addresses current market challenges and anticipates future demands. Considering the rapid development in this field, where over 15 ZK-rollups on Ethereum are already incurring substantial costs (~$47m) in Proof Verification, with more in development, the need for cost-effective solutions is clear.

Our preliminary research suggests the potential for a dramatic reduction in proof verification costs for ZK-Rollups, by as much as 90-95%. This is especially pertinent given the predictions of Ethereum’s co-founder, Vitalik Buterin, that ZK-Rollups will likely become the preferred scaling solution in the future (Source: The Block). A dedicated Proof Verification Chain would not only make running a ZK-Rollup more economical but also aligns with the anticipated shift towards these technologies becoming the dominant scaling solution.

3. To Foster Collaboration Across Ecosystems And Expand The Reach Of Horizen In line with our strategic vision, the Proof Verification Chain is being meticulously designed to accommodate a variety of proof types and settlement layers.

Specification

The “New Horizen” initiative is set to revolutionize blockchain technology by adopting a new modular approach. It will deliver multiple components that address the market’s current and future needs. Central to “New Horizen” is the Proof Verification Chain, which will focus on verifying proofs originating from other blockchains, such as rollups or appchains.

At this initial stage, we broadly refer to “proofs” to highlight our vision for the versatility of the Proof Verification Chain. Initially, our focus will be on ZK SNARK proofs, addressing the immediate market need and ease of integration, particularly for ZK-Rollups.

The Proof Verification Chain will be established on an entirely new technological framework. A key component of this framework is the use of the Substrate SDK. Notably, the new blockchain developed under New Horizen will operate independently of the Polkadot ecosystem, meaning it won’t function as a parachain linked to the Polkadot relay chain. Additionally, it will adopt a Proof of Stake (PoS) consensus algorithm to ensure robust network security.

Refer to the ZenIP discourse topic for the full specification.

Rationale

• Addressing Market Needs: The current usage of our mainchain and Zendoo are somewhat limited. By introducing new technology that is attuned to both existing and emerging market demands, we anticipate stimulating significant activity within the Horizen ecosystem—a feature that has been notably absent historically. In the past, Horizen was primarily technology-led rather than guided by addressing the current and evolving needs of the market. This new direction aims to bridge that gap.

• Embracing Modularization In The Industry: The blockchain industry is progressively moving away from monolithic, “one-size-fits-all” models towards a more dynamic and flexible modular approach. It’s crucial for Horizen to seize this pivotal opportunity now, to stay ahead in the rapidly evolving blockchain landscape. By doing so, we can ensure that we are not just keeping pace but leading the way in this industry transformation.

• Promoting Inter-Ecosystem Collaboration: The trend towards collaboration across different ecosystems is accelerating. Adopting a settlement layer agnostic solution aligns perfectly with this trend. It will enable us to collaborate more effectively with industry leaders and foster an unprecedented level of interconnectedness between Horizen and other ecosystems. This approach is not just about technological innovation; it’s about integrating Horizen more deeply into the broader blockchain community and forging alliances that can lead to shared growth and success.

Challenges and Considerations

Migrating the existing Horizen ecosystem to the innovative Proof Verification Chain presents several challenges that require meticulous attention and strategic planning.

1. Transitioning from PoW to PoS:

2. Possibility of Limited Community Adoption:

3. Initial Security of the New PoS Chain:

4. Secure Fund Migration:

Voting

• For: Support the proposed changes and direction as outlined in ZenIP-42400.
• Against: Do not support the proposed changes and direction outlined in ZenIP-42400.