Redefining DeFi on Linea with ZK Tech

The collaboration between ZEROBASE(formerly Salus) and Lynex marks a groundbreaking moment in the realm of DeFi. Salus, with its expertise in web3 security, is set to integrate ZK technology into Lynex, a leading DEX on Linea. This integration is more than a mere enhancement; it's a pioneering step towards redefining DeFi transactional security and privacy.

ZEROBASE’s innovation lies in integrating zk features uniquely tailored for Lynex. This integration is poised to provide Lynex with unparalleled transaction confidentiality and efficiency, a significant boon for users seeking privacy and projects requiring secure, large-scale transactions.

The synergy of zk technology with Applications, as showcased in this partnership, brings a new dimension to DeFi. It addresses the challenges of privacy and performance concurrently, allowing for secure and private transactions without compromising efficiency. The potential of this technology extends beyond Lynex, promising a transformative impact on the entire Linea ecosystem.

Let’s explore zkLynex.

Privacy

Integrating zero-knowledge proofs, Lynex ensures that transaction details remain private, even during verification. Suppose zkLynex needs to conceal the price of a limit order from the chain, and the order is represented as follows:

$$O=(t,s), where t:=(φ,χ,d), s:=(p,v,α)$$

• $φ$: side of the order, $0$ when it’s a bid, $1$ when it’s an ask

• $χ$: token address for the target project

• $d$: denomination, either the token address of USDC or ETH. Set $0x0$ represent USDC and $0x1$ represent ETH.

• $p$: price, denominated in $d$

• $v$: volume, the number of tokens to trade

• $α$: access key, a random element in bn128’s prime field, which mainly used as a blinding factor to prevent brute force attacks

To conceal price info while still generating a proof, Lynex needs to expose values related to the price, specifically the balance required for the order $b$. In detail, for a bid order:

• the bidder must provide the token amount required for the order's face value;

• for an ask order, the seller must provide the target token they wish to sell.

The balance $b$ is denoted as a pair, where the first element specifies the quantity of the target project token, and the second element specifies the quantity of the face value token.

Generally, the Poseidon hash is used to mask the order's price and quantity, revealing only the balance required for the order. ZK-SNARKs are employed to prove that this balance indeed corresponds to the price required by the order. This technique allows users to conduct transactions in a secure environment where sensitive information about their trades is not exposed. This approach is particularly beneficial in DeFi, as it maintains the integrity and transparency required for Lynex, while protecting user privacy

Performance Optimization

Linea is already known for its low transaction costs, but it's possible to enhance this efficiency even further with the use of fully recursive SNARKs. Think of it like cleverly folding a really large map so it fits easily into your pocket. The implementation is designed to optimize performance by reducing data and computation needs, making complex on-chain transactions more feasible and secure.

• Folding Circuits with Recursive SNARKs: Think of recursive SNARKs as a method of neatly folding complex operations, making them simpler and less costly. This is similar to condensing a long process into a few streamlined steps.

• Optimizing Costs: The key to this optimization lies in the ability to combine these operations in a cycle, reducing the need for more complex and expensive computational steps. This is particularly useful in situations with multiple transactions or operations, like in a dark pool scenario.

• Benefits for Users: For you as a user, this means that even the more complex transactions become quicker and less costly. The system is designed to handle intricate operations more efficiently, ensuring that your on-chain actions are processed smoothly.

• Enhanced Scalability and Security: The end result is not just about saving costs, but also about enhancing the scalability of the platform. This means that Linea can handle more transactions, more complex logic, and ensure quick and secure verifications, all while keeping costs down.

For the Users

zkLynex brings the concept of a dark pool to its platform, offering significant advantages to its users:

Understanding Dark Pools

A dark pool is like a private trading club where transactions are hidden from public view until they are completed. This is analogous to trading Pokémon cards secretly among friends, without others knowing what cards are being traded. In finance, dark pools allow for the buying and selling of stocks without the immediate public disclosure of the transaction details.

Benefits for Users

• Surprise Factor: Users can make trades without revealing their intentions until the trade is finalized. This is similar to not letting friends know about a rare card trade until it's done.

• Price Stability: Secret trades prevent sudden market reactions to large transactions, thus maintaining stable prices.

• Efficient Large Trades: Users can execute large trades without significantly impacting the market value.

zkLynex’s Role in DeFi

• Privacy Transition: By enabling private transactions, zkLynex aims to adhere to Ethereum’s major technical Privacy transition based on the three transition ecosystem by Vitalik.

• Reduced Market Impact: In DeFi, where prices quickly react to market changes, zkLynex’s approach of reporting data post-trade execution minimizes market disruption.

Security and Privacy Enhancements

• Protection Against MEV and Bots: zkLynex shields users from MEV attacks and front-running bots, common issues where bots execute orders ahead of users, impacting prices unfavorably.

• Secured Large Orders: For users making large trades, zkLynex offers a secure environment to conduct these trades without revealing their strategy or impacting the market.

Improved Trading Experience

• The implementation of zkLynex on Linea leads to a more discreet and secure trading environment, enhancing liquidity quality and ensuring smoother transaction experiences.

In an exciting collaboration with Lynex, we are thrilled to bring the first-ever zkApp to the Linea Chain. This groundbreaking initiative, dubbed zkLynex, marks a significant milestone in our journey as we leverage the potential of Zero-Knowledge (ZK) technology to revolutionize Lynex.

ZK technology is not just a component; it's a game-changer in the Layer2 ecosystem, standing at the forefront of innovation. Its ability to enhance transaction privacy while maintaining efficiency is unparalleled. By harnessing this technology in zkLynex, we are setting new standards in secure and private blockchain transactions.