What are some common use cases for rollups?

What are some common use cases for rollups?

Rollups are often used in blockchain technology to improve scalability and reduce transaction costs. Common use cases include decentralized finance (DeFi) applications, NFT marketplaces, and gaming platforms.

Can you explain how rollups improve scalability?

Rollups bundle multiple transactions into a single one, which reduces the load on the main blockchain. This allows for faster processing and lower fees.

What types of rollups are there?

There are two main types of rollups: optimistic rollups and zero-knowledge rollups. Optimistic rollups assume transactions are valid, while zero-knowledge rollups use cryptographic proofs to ensure validity.

Are there any downsides to using rollups?

Yes, some downsides include potential centralization risks and the complexity of implementing rollups, which can lead to security vulnerabilities.

How do rollups compare to sidechains?

Rollups process transactions on the main chain, while sidechains operate independently. Rollups generally offer better security and interoperability with the main chain.