STARKs: Achieving blockchain scalability through efficient proof computation
StarkEx: An extension engine for specific applications
Starknet: A permissionless, second-layer network for smart contracts
STARKs
STARKs (Scalable, Transparent ARgument of Knowledge) is a proof system that allows for the proof and verification of computations. It enables the processing of large-scale computations, generating proofs of correctness for these computations, and then verifying these proofs in a few steps.
STARKs play a crucial role in blockchain scalability by allowing large-scale computations to be performed off-chain, with low costs, and only validating them on-chain. The validation process requires only a small fraction of the original computation. In other words, by executing a few steps on-chain, validators can assert the integrity of a large number of off-chain computations.
Using STARKs, second-layer solutions can batch process and compute thousands of transactions, and then validate their validity on-chain using a single STARK proof. The on-chain costs are distributed among all the transactions in the batch. This results in improved user experience and lower gas costs for each transaction, while maintaining the security of the Ethereum settlement layer.
StarkWare offers two solutions for scaling Ethereum using STARKs: StarkEx and Starknet.
StarkEx
StarkEx is a framework for creating permissioned, application-specific scaling solutions. It serves as a useful toolkit for projects to implement low-cost off-chain computations. Off-chain computations generate a proof of execution correctness, which can include as many as 12,000 to 500,000 transactions (depending on the transaction type). The proof is then sent to the STARK verifier for on-chain acceptance. This means that all transactions require only one verification, resulting in extremely low gas costs per transaction.
Some examples of applications deployed on StarkEx include dYdX (perpetual trading), Immutable and Sorare (NFTs - minting and trading), DeversiFi (spot trading), and Celer (DeFi pooling).
StarkWare continues to add more application flows to StarkEx to meet market and customer demands.
Starknet
Starknet is a permissionless second-layer network where any user or developer can deploy smart contracts developed in the Cairo language.
Similar to the Ethereum smart contract experience, within the Starknet ecosystem, your contracts can interact with any other contract deployed on Starknet, enabling highly composable protocols. Starknet contracts can also interact with Ethereum contracts through asynchronous message passing.
Unlike StarkEx, where applications are responsible for submitting transactions, in Starknet, the sequencer batch processes transactions and sends them for processing and proof. (The Starknet sequencer is currently operated by StarkWare, with plans for decentralization in the future.) This means that once applications deploy their Cairo contracts, they do not need to worry about running additional operator infrastructure. Starknet supports the Rollup data availability mode, meaning the state of the rollup is written to Ethereum along with the STARK proof.
A large developer community is actively involved in building the Starknet ecosystem, developing applications, tools, and infrastructure. Dozens of applications have already gone live on the testnet - DeFi, gaming, voting, AI, etc. Additionally, development tools such as block explorers, local testing environments and frameworks, SDKs in multiple languages, etc., are being built by the Starknet community. Active discussions on improvement proposals, potential features, and best practices are also taking place on the Shamans platform.
Summary
StarkEx and Starknet are both STARK-based scaling solutions. They offer scalability, low gas costs, and security, but have different operational requirements and interoperability modes. For most self-contained applications that fit the APIs provided by StarkEx, StarkEx may be the right solution. For protocols that require synchronization with other protocols or have requirements beyond what StarkEx provides, Starknet may be more suitable.
STARKs have revolutionized the way applications are built on Ethereum. StarkEx and Starknet will continue to support previously infeasible applications and push the limits of possibilities on the blockchain.