MakerDAO will launch on StarkNet with 10x lower gas costs but will also have increased withdrawal times so let’s read more today in our latest cryptocurrency news.
The DeFi Blue Chip proejct MakerDAO will launch on StarkNet soon in order to cut transaction costs and enhance withdrawal times. MakerDao announced the protocol’s upcoming deployment on the ETH layer 2 scaling solution StarkNet. Considered a key player in the DEFI space, MakerDAO is a smart contract-based system for lending and borrowing crypto without the need for intermediaries.
MakerDao’s protocol is built on the ETH blockchain and comes with two currencies, DAI and MKR as the system’s governance token. MakerDAo’s integration with StarkNet is the first time the protocol launched on the ETH rollups using ZK Technology. Rollups settle transactions outside of the main blockcahin and relieve congestion from the mainnet and offer high transaction speeds without having to sacrifice overall security. Produced by StarkWare, StarkNet is a layer 2 scaling solution for the ETH blockchain.
It uses the cryptography technology known as ZK Rollups which allows blockchain networks like ETH to process bigger batches of transactions fast and cheaply. Because it leverages zero-knowledge technology it also preserves a huge portion of the users’ privacy. In the announcement shared today, the team at MakerDAO noted that the protocol’s integration with StarkNet will lower the costs of the DAI transactions and minting compared to the ETH mainnet. Sharing some more insight into the matter, Louis Baudoin from the StarkNet core Unit said:
“Maker’s gas costs are dominated by transactions related to minting and by transactions related to oracle costs,” adding that “once Multi-Collateral DAI (MCD) is deployed on StarkNet, we can expect the transactions related to minting to cost 10x less on StarkNet than on [on the] Ethereum [mainnet].”
Today’s news came after a year from the integration with the optimistic rollups, Optimism, and Arbitrum and it is also a part of the protocol’s team multichain strategy. Baudoin said:
“As we see unsustainable gas fees drive more activity and users to a wider variety of blockchains, security challenges that come with bridging will continue to grow. Projects must move on to layer 2 to continue to serve users, and MakerDAO is partnering with StarkNet to do exactly that.”
The goal for StarkNet is to brign the transaction time down to a few seconds in the next year as Baudoin added:
“From a cost standpoint, users can execute transactions on StarkNet at a cost about 10x cheaper than on Ethereum layer 1.”
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