You’ve probably heard that “zk is the endgame.” What does that mean? Why zk? Why not something else? What problems do zk solve anyway? Today’s 0x tells a short (and highly simplified) tale about the history of zk.

A long way from “alt season”:

CoinMarketCap’s new Altcoin Season Index tracks how many of the top 100 altcoins have outperformed BTC in the past 90 days. Today’s reading stands at 14/100, signaling a clear Bitcoin Season. The decline has been steady — down from 21 last week and 28 last month — showing that BTC is absorbing most market attention while altcoins struggle.

The index hit a yearly high of 87 in early December 2024, but since then, capital rotation has been in full swing.

As to where this might turn once again — the divergence between valuation and actual network activity, as noted by Alex Svanevik, sums up sentiment around altcoin markets these days.

“[T]here are chains with virtually zero usage that have higher valuations than chains with lots of usage,” Svanevik said, calling this a broken system.

While some traders like to deride the whole notion of crypto fundamentals, at some point narratives have to move past speculative cycles for crypto to be useful.

— Macauley Peterson

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A brief (and oversimplified) history of ZK

It all starts with Ethereum. The L1 is too slow. Every node needs to redundantly re-execute transactions in a block to ensure validity, which limits scalability.

By 2020, the Ethereum community coalesced around rollups as the scaling solution. Vitalik’s 2021 landmark blog post on rollups explains how optimistic and zk rollups can scale Ethereum.

Zk rollups are technologically superior for scaling but the tech was still too expensive to use and far behind (more later). 

So optimistic rollups broke into the market first. Optimistic rollups assume all transactions are valid until someone challenges it with a fraud proof within a seven-day challenge period.

Optimistic rollups worked, but they came with hidden costs. The challenge period meant longer transaction finality before users could withdraw funds. Locked liquidity meant capital efficiencies and a generally poorer UX, especially with chain interoperability.

Meanwhile, zk was catching up. At ETHCC 2022, Polygon, zkSync and Scroll all announced zkEVMs, which enable Solidity devs to write code and prove the execution of the EVM — effectively allowing Ethereum to leverage zero knowledge technology.

By 2023, zk rollups started to gain real traction. 

Why exactly are zk proofs better than optimistic fraud proofs? Namely because zk proofs are much smaller (~1-10 KB) compared to raw transaction data (megabytes in size).

By using zk cryptography to prove Ethereum transactions, these highly compressed proofs meant lower data availability costs and better scalability.

Though zk was taking off, proof generation was still expensive. Based on zkstats.io, the average cost to generate a zk proof in December 2023 was $80.21.

Fast forward to 2025. Proof costs have dropped to $1.3 per proof, about a 98.4% improvement.

What changed?

Today, each of the core pieces of the zk rollup stack have been broken up. 

Firstly, zkVMs are here. These specialized virtual machines speed up the zk development experience and make validity proof generation more efficient. Before zkVMs, developers needed to write complex, mathematical “circuits” to prove EVM execution.

ZkVMs like SP1, RISC Zero, Nexus and OpenVM today effectively democratize zk development for all developers (C++, Rust) without zk cryptographic expertise. In the past, zkEVMs only enabled Solidity development on zk rollups. Think of zkVMs as a more general concept than zkEVMs.

Second, the costs to generate proofs are going down because of market competition. Today, there are many competitive marketplaces operated by Risc Zero, Cysic, Lagrange and Succinct. Some are still in testnet, some are operational.

Zk L2s are also turning to proof aggregation techniques to amortize verification costs. The way this roughly works is by batching many proofs inside of one, which makes the final proof faster to verify.

These marketplaces are also permissionless, meaning anyone with a GPU rig can sign up, post a bond and generate zk proofs. Previously, zk rollups used “centralized provers,” meaning they rented GPU/FPGA hardware from Google or Amazon.

Better proof systems are also constantly launching. These proof systems (examples: Groth16, Halo2-KZG, STARK, Plonk, Expander) algorithmically define the rules as to how zk proofs are constructed and verified. They’re getting better, which means zk proofs are getting smaller and faster to verify. This in turn means increased zkVM performance gains.

So there you have it. That’s why zk is the endgame.

— Donovan Choy 

Sonic yield farming with wstkscUSD

It’s a mouthful, but wstkscUSD refers to a pool on Pendle Finance’s Sonic dapp that’s seeing DeFi inflows thanks to its generous APY alongside additional incentives: 2x Rings points, 12x Sonic points, and 3x Veda points.

The strategy involves Rings depositing user funds into Veda vaults, which automatically compound yield while participants passively earn rewards.

It’s worth flagging that the underlying stablecoin, scUSD — which numbers less than $2 million — recently experienced a slight and temporary depeg, causing alarm for those borrowing the asset. The issue reportedly stemmed from the temporary lockdown of the Safe API, following the Bybit Safe exploit.

As a result, Rings was unable to access Veda vaults, effectively preventing redemptions and causing liquidity disruptions. With Safe access now restored, scUSD has returned to its peg, but the incident highlights the structural risks in multi-layered DeFi strategies.

The strategy won’t appeal to everyone — while the rewards are attractive if you value points, users should assess risk exposure and diversify accordingly.

The main question is: What regulatory changes will let dapps drop the US geo-fencing?

— Macauley Peterson

Calling the Builders Who Move Fast

If you’re engineering the next generation of crypto — whether it’s infrastructure, DeFi, or something entirely new — you belong on the Permissionless stage.

Speaker applications are open. If you’re a technical founder, CTO, or dev, this is your chance to share, debate, and push the space forward.

And for those ready to prove it with code? The Hackathon is your shot. $100K+ prize bounty. Investors watching. No gimmicks — just shipping.