Its day 18 of #web3glossary 🚀🚀
R: Relayer, Rug pull,Rollup
Blockchain is still in its infancy and stuck transactions can be a frustrating experience. There’s got to be a solution, right?
Lessgooo👇2⃣2⃣
Relayer it is💯
As the name suggests, it takes individual orders and organizes them into an order book to simulate the experience of an exchange without actually being one.
Send your meta transactions, the relayer takes care of the rest!
What is a meta txn?🤔🤔
Meta txn = standad txn (from, to value, sign etc) except instead of sending it directly to a blockchain, its sent to a third party which takes care of the gas
1⃣The third party builds a new txn containing the meta-transaction and sends it to a smart contract proxy
👇👇
2⃣ It then checks the validity of the meta-transaction (using sign) before executing it.
P.S. Relayer is the third party here. it’s like hosting an off-chain orderbook.
0x is an example of a popular Ethereum relayer protocol.
You might wonder: if the application can relay the transactions by itself for its users, when and why do we need a relayer?
It improves the transaction outcome in the blockchain & also facilitates implementation of gasless transactions.
Ex
If you want to send 3 txns, you’ve to..
..wait till the first 2 txns are processed. Now, the no. of pending transactions for an account is limited by the node.(64 in case of Geth). In case of say 3 accounts it can upto 192. Beyond this limit, the node can arbitrarily delete transactions from its queue.🤯
To overcome these limitations, a relayer can dispatch its meta-txns & send them from multiple accts
More so, when a txn is stuck on one of the accounts, the relayer can displace it to one of the two remaining accounts and thus keep sending its transactions
How to implement?🤔
Checkout opengsn.org to know more on how to implement relayers!
Ethereum, the most popular blockchain, has seen scaling issues for quite a long time now, with high gas fees due to congestion being the primary pain point. With the increasing cost to use the network, a plethora of scaling solutions have emerged.
Rollups is one of them🥁
Rollups is an infrastructural layer 2 scaling solution for the Ethereum network. Rollups settle the transactions outside of the main Ethereum network but post the transaction data back to the Ethereum network and still derive its security from the Ethereum protocol.
📌The txn is executed off the chain on a rollup specific chain
📌Next, the batched transaction data is compressed, and sent to the main Etheruem chain
👉 this reduces the load on the main Ethereum network freeing up the computational power on layer.
There are different ways of approaching this problem from a technical pt of view
📌Zero Knowledge(ZK) & optimistic rollups
Rollup not only help in reducing the fees but also enable redeployment of all the existing Ethereum smart contracts to a rollup with little or no change💯
Where there’s money, scams follow👀
Rug pull is a crypto-token based scam
Let’s scratch the surface!
In rug-pulls, the creators of the token create hype, through injecting liquidity into their token, airdropping, and other schemes, and once investors pile in and boost the price..
..of the token to a certain point, the creators pull as much value out of their share of the tokens,
leaving their investors with close to nothing.
It’s a DeFi exploit and seemingly common.😬😬
There are different types of rug pulls, some illegal and some unethical. Also there are several clear signs that investors can watch out for, to protect themselves from rug pulls.
Let me know, if you’d like to learn more on them.🚀🚀
Thats a wrap for Day 18!
I’ll be sharing information on the new vocabulary of the web for next 30 days.🚀
It’s like a free crash course on the terms and methodolgies in Web3.
📌Follow me @laishawadhwa for more such web3 gyaan!
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