Ethereum's Evolution: Manta Pacific and L2 Dynamics

13 Feb 2024

In this article, you can find information about Manta Pacific, as well as Celestia, Scroll, zkSync, Polygon zkEVM, Arbitrum, and Optimism.

Manta Pacific is the first modular Ethereum L2. It utilizes Celestia for data availability and sends ZK proofs to Ethereum for settlement. It manages the execution part on its own.
It doesn't qualify as a ZK rollup because it doesn't send transaction data to Ethereum, technically making it a validium.

What are Samet rollup and validium?

Optimistic rollup: fraud proof + on-chain data (Arbitrum, Optimism)
ZK rollup: ZK proof + on-chain data (zkSync, Scroll)
Optimum: fraud proof + off-chain data (Mantle, Aevo)
Validium: ZK proof + off-chain data (Immutable, Manta)
Off-chain data means not sending the data to Ethereum, enabling cheaper transactions but compromising on data security.

Transition from Manta Atlantic to Manta Pacific:

Manta Atlantic is a Polkadot parachain, i.e., an L1 blockchain. With the transition to Manta Pacific, they became an Ethereum L2. However, Manta Atlantic remains active and serves Manta Pacific for staking and governance purposes.

Why did they make this transition?

It's not possible to develop ZK applications (DeFi, NFT, GameFi) on Manta Atlantic. The team wanted to change this due to their vision and belief in the future of ZK technology.
From the perspective of developers, it's possible to develop ZK applications (DeFi, NFT, GameFi, etc.) on Manta Pacific for anyone proficient in Solidity. This could lead to rapid ecosystem growth.

From the perspective of users, they might prefer Manta Pacific over Ethereum due to lower L2 transaction fees. The user base could rapidly increase.
Is it easy to be cheaper than Ethereum? Are other L2 projects cheaper?
Since it uses Celestia for data availability, transaction fees on Manta Pacific are lower than other L2 projects.

How are Manta Pacific metrics?

The daily average user count is around 40k.
TVL (Total Value Locked) is good, and Market Cap / TVL ratio ranks second best. Arbitrum is in the first place.

The number of developers is slightly lower compared to other L2s.
Considering it's a newly launched project, inflation seems reasonable. It appears capable of handling selling pressure if it arises.

We need to monitor developments to see if they can increase the number of applications, thereby increasing user count and revenue.

What's in the Manta Pacific roadmap?

Phases 1 and 2 are completed. Phases 3 and 4 are next.
Manta Pacific will transition to a zkEVM with the Polygon CDK (Chain Development Kit) in Phase 3, enabling access to a large liquidity pool and user base. It will continue to use Celestia for data availability.

In Phase 4, they will complete work on cheaper transaction fees, higher speed, better user interface, and account abstraction.
After Phase 4, it will continue its journey as a full mainnet.

How can I stake my 10-20 MANTA tokens?

Staking is done through Manta Atlantic, requiring a minimum of 500 MANTA tokens.
However, Manta CEO Kenny Li mentioned in a video that you can stake amounts below 500 MANTA tokens through Bifrost Finance. I haven't tried it myself, but those interested can give it a try.

Should we buy or sell? What do you think?

As you know, I'm just sharing my own plans without giving advice.

Based on current prices, the fully diluted values of tokens when fully released are as follows:
ARB: $21 billion (1 ARB: $2.1)
OP: $16.5 billion (1 OP: $3.85)
MATIC: $8.8 billion (1 MATIC: $0.88)
MANTA: $2.9 billion (1 MANTA: $2.9)

In my opinion, this ranking seems correct for now. I expect MATIC to surpass OP and compete with ARB by 2025.

Likely, projects like zkSync, Scroll, and Linea will have valuations around $5-10 billion. zkSync might have a slightly higher valuation.

Therefore, based on its metrics and roadmap, MANTA seems deserving of a $4-5 valuation at the moment. This would result in an FDV (Fully Diluted Value) of around $5 billion.

Why do you rank zkSync, Scroll, and Linea ahead of Manta?

Scroll is ahead in EVM compatibility and will likely attract many projects, developers, and users from Ethereum.

Linea and zkSync have significant investment ($700M and $450M), giving them the power to build a large ecosystem and community. They are also in good technological standing, and with marketing efforts in a bull market, they are likely to grow larger.
I'll write a more detailed comparison of zk projects in 1-2 weeks.

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