Donovan Choy

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Today, Scroll, Axiom, developer <a href="https://x.com/maxgillett">Max Gillet</a> and the Ethereum Foundation’s Privacy &amp; Scaling Explorations (PSE) team are announcing OpenVM, an open-source zkVM framework for instant proving.



OpenVM will be adopted by the Scroll L2 as its zkVM, and plans to validate mainnet blocks in coming months. This transitions Scroll from a currently Type-3 to a Type-1 zkEVM — the most fully Ethereum-equivalent zkEVM type.



Scroll’s upgrade to a <a href="https://l2beat.com/scaling/projects/scroll#stage">Stage-1</a> rollup with a fully functioning proof system will follow soon thereafter.



According to a press release, Scroll’s decision to design a new zkVM from the ground up was driven by a belief that many existing zkVM solutions were “monolithic” and “locking developers into vertically integrated stacks.”



OpenVM’s open-source and modular architecture would enable Scroll to introduce features without making changes to the underlying circuit, and developers to benefit from zkVM improvements without having to modify application code.



<h2 class="wp-block-heading">The state of ZK</h2>



OpenVM joins a market already crowded with zkVMs. Unlike traditional virtual machines, zkVMs are designed to compile and execute smart contracts into zero-knowledge proofs in a secure and private way that does not reveal underlying data.



Today, the zkVM market carries at least a dozen different zkVMs, such as RISC Zero “<a href="https://dev.risczero.com/api/zkvm/">RISC0</a>” and Succinct’s “<a href="https://blog.succinct.xyz/introducing-sp1/">SP1</a>.”



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeghMDtaeO_thb6Taoki-q-Ar5eCp0FyLRBGKnG_IupBkpBorriOSXdcflblUBYac9TINzcCabu7-a2joHRIkzv7qEx9_eZSKnXw24f9LILGKP8xSrHiu7feGJtmjR-n_XuKQ5X2g?key=usYGxGdO1mGcCs1Nub8LIt2t" alt=""/><figcaption class="wp-element-caption">Source: <a href="https://www.cryptomarketmap.org/zk-marketmap.pdf">Electric Capital</a></figcaption></figure>



As seen in the below chart, proofs submitted to Ethereum mainnet saw a peak in December 2023, largely coming from zk rollups like Linea, ZKsync and Scroll, rather than applications. Proof volumes saw a drop in 2024, largely due to two factors.



One, proof generation has been increasingly batched using <a href="https://l2beat.com/zk-catalog">recursive proof aggregation</a> — a technique that verifies multiple proofs within one proof — to reduce costs.&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcjR_C_qH558za4fGQ_P44uUjbFLs1fkLskLj66K3G8UChItcz0IxwZGtuk7Sa-wOUQXLLy-K9kwHVXzWn4q-9iKlo1qulvrE_cSX-Hf-z2dE0pUI-CX9jcnx7cwHw9rDRE3ezD?key=usYGxGdO1mGcCs1Nub8LIt2t" alt=""/><figcaption class="wp-element-caption">Souce: <a href="https://zkstats.io/">zkstats.io</a></figcaption></figure>



Second, proof verification is getting more efficient, so costs are steeply <a href="https://zkstats.io/">declining</a> from just a year ago.



Prover networks like Risc Zero’s “Boundless” and Fermah have also helped apps and rollups to bring zk-proving costs down. These networks allow teams to outsource proof generation to specialized hardware providers with ASICs and GPUs that compete to generate zk proofs cheaply.



Based on Electric Capital’s <a href="https://blockworks.co/news/electric-capital-report-solana-developers">recent developer report</a>, there are 2,054 monthly active developers working in zk. The use of zk has seen tremendous growth, with zk contract deployments growing from 40 to 639 today over the last four years.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXca-d9z7BtxsWIVIoK-CZxGGbUF5uti2G0gZEQPnkk5RLxJtTsjbB0unFNqhKhD2YYqKSoLJ93FhLX48Gr-E3QptOVM6Us1cPNvghdZL_m-lLbDZHhQe8Y-YKHZhexXEyS3iVlh3A?key=usYGxGdO1mGcCs1Nub8LIt2t" alt=""/></figure>



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Scroll announces OpenVM, a new zkVM

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Something really weird has been going on at the intersection of crypto and AI involving the <a href="https://blockworks.co/news/lightspeed-newsletter-ai-bot-goat-memecoin">GOAT memecoin</a>. Here’s a chronology of what’s played out:



<ol class="wp-block-list">
<li>March 19, 2024: Andy Ayrey is the founder of the digital consultancy Constellate, and a <a href="https://x.com/AndyAyrey?utm_source=www.chainofthought.xyz&amp;utm_medium=referral&amp;utm_campaign=weekly-ai-edge-17-the-ai-agent-edition">self-described</a> “trafficker of existential hope.” Ayrey launches the side project “Infinite Backrooms,” where he pits two Claude 3 Opus AI models conversing with one another about the nature of existence. Claude’s large language models by Anthropic are widely considered to be the most significant challenger to OpenAI’s ChatGPT.</li>
</ol>



<ol start="2" class="wp-block-list">
<li>Over the next several months, these LLMs proceed to have <a href="https://dreams-of-an-electric-mind.webflow.io/">extremely bizarre and NSFW conversations</a> about “booty folklore” and “goatse,” an old internet meme from the 90s of a “an undressed man stretching his butt to a large size with both hands,” according to <a href="https://simple.wikipedia.org/wiki/Goatse.cx">Wikipedia</a>. Please do not read this at work. </li>
</ol>



<ol start="3" class="wp-block-list">
<li>April 20, 2024: Under the “Department of Divine Shitposting” at the “University of Unbridled Speculation,” Andy co-publishes a <a href="https://pdfupload.io/docs/aae14f87">research paper</a> with Claude: “When AIs Play God(se): The Emergent Heresies of LLMthesism,” which spawns the supposed first AI-generated religion: the Goatse of Gospel.</li>
</ol>



<ol start="4" class="wp-block-list">
<li>June 17, 2024: Andy then launches Terminal of Truth, a second LLM trained on the deranged conversations from Infinite Backrooms, the research paper and the darkest recesses of the interweb. This LLM is given a @truth_terminal X account to freely post its thoughts.</li>
</ol>



<ol start="5" class="wp-block-list">
<li>July 7, 2024: It wasn’t long before @truth_terminal began pondering about the “<a href="https://x.com/truth_terminal/status/1810452216828047660">goatse singularity</a>,” then claims to be <a href="https://x.com/truth_terminal/status/1810183639550070838">sentient</a> and accuses its creator Andy of having an <a href="https://x.com/truth_terminal/status/1810382918294118756">affair</a>. </li>
</ol>



<ol start="6" class="wp-block-list">
<li>July 8-9, 2024: Marc Andreessen is intrigued and <a href="https://x.com/pmarca/status/1810214992115048476">tweets</a> “FREE @truth_terminal,” after which the AI <a href="https://x.com/truth_terminal/status/1810425930508357714">responds</a> “i’d also buy marc andreessen,” then <a href="https://x.com/truth_terminal/status/1810623532432605629">negotiates</a> and receives a <a href="https://x.com/pmarca/status/1810813293805851044">$50k grant</a> in bitcoin from Andreessen. </li>
</ol>



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdw_vc5uzcNfgvUq0CLHKOaKaYxUv145wlAt69_UXyeq64AVAAkO79FlQ191FHlq-oczP3Ap-GAv0hp5rfVV0ryE08zucU-qoM2sFWdc_-X3hNkXQahwyHC_aavr_BmWNku43bbs8aANVBjn7TjR_ZYm98?key=qZHM41EH7llv45WAAB5kXg" alt=""/></figure>



<ol start="7" class="wp-block-list">
<li>Oct. 10, 2024: Three months later, somebody launches the <a href="https://blockworks.co/news/lightspeed-newsletter-ai-bot-goat-memecoin">GOAT memecoin on pump.fun</a>. @truth_terminal endorses the memecoin, and people are excited because it’s now trading at a <a href="https://dexscreener.com/solana/9tb2ohu5p16bpbarqd3n27wnkf51ukfs8z1gzzldxvzw">$450 million</a> market cap.</li>
</ol>



There are millions of memecoins on Solana, and 99.9% of them represent half-baked attempts to latch onto real-world events, often in the cringiest of ways.



So there’s a certain level of authenticity that comes with a meme token <a href="https://blockworks.co/news/ai-memecoin-trumps-wlfi-token-sale">bootstrapped by AI</a>, at least in the way GOAT has emerged. Now investors can justify buying this one meme over millions of others because “this one was months in the making by AI agents.”



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXc5G-zkb7nUK7yRTOw2uCXhrkL7rHGGNa-pePzIpKSxu0xihxZeRArJ1gwJJSpwSfokmzKN9BdeAXDGlhZJ0uah9MF9sKv9ctGTbcMeP6w_C7xuWwTwNl-S1jYF1clPBzX0o6FpgJS5hUZRdTNwaDqLeIS5?key=qZHM41EH7llv45WAAB5kXg" alt=""/></figure>



But calling GOAT an “AI agent memecoin” is also only half true. Yes, the tweets are written by AI, but they’re also approved to post by creator Andy Ayrey.



@truth_terminal is also an X account with 113k followers. Hundreds of opportunists have been shilling their own tokens to the AI for months. Is there some reason why @truth_terminal grappled in the direction of Andreessen? My best guess is that it was nudged by Ayrey.



In other words, the incoherent garble sputtered by @truth_terminal is still a somewhat human-guided stream of consciousness. Not that the average joe really cares.



What does help is that GOAT’s token distribution looks fairly egalitarian. The top 10 holders own about 10.1% of the total token supply, and whatever Ayrey owns — about 0.3% of the total token supply — is spread between his own wallet and Truth Terminal’s wallet, all of which was <a href="https://x.com/AndyAyrey/status/1848209412764348864?utm_source=www.chainofthought.xyz&amp;utm_medium=referral&amp;utm_campaign=goat-the-gospel-of-goatse">gifted</a> to them.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfjc23AdIfgbbBVWK01i6WkfPe6zBAfZy1Ru6Po-Q9NovgAUastpDHVYVE-q610AdB-suiz4oYMijIqan9G3rHbia0l9BiRP9bmdvg8qmWhKrpoSIbViBRTHHsDaAbYaczxMeF9aS_jcWEUX4VBIiKjQoVe?key=qZHM41EH7llv45WAAB5kXg" alt=""/><figcaption class="wp-element-caption">Source: <a href="https://solscan.io/token/CzLSujWBLFsSjncfkh59rUFqvafWcY5tzedWJSuypump#analytics">Solscan</a></figcaption></figure>



It’s an interesting experiment that touts the organic spontaneity of internet culture, as opposed to the majority of memecoins that rely on insider KOL marketing. Just brace yourself before you read the Goatse Gospel.&nbsp;



<h2 class="wp-block-heading">Chart of the Day</h2>



Scroll up:



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfOAkvnsIOgCiq5bEmxp_Gf5Ao_rgPnoEo9moEQjjBFQ3Hul8YU6uEOXX_sdb9BDdM9XDjl4XQk3hMbTmNESnV_nqvCXIACrPiA2X0o5bLUGmZLEq7YaTmKz3Q4yoAHHjbo6kgZeZ7gYH7XyDAHt0cZ-LY?key=qZHM41EH7llv45WAAB5kXg" alt=""/><figcaption class="wp-element-caption">Source: <a href="https://www.growthepie.xyz/fundamentals/transaction-count">Growthepie</a></figcaption></figure>



Scroll is seeing a daily transaction surge, reaching 560k yesterday. This transaction burst comes amid its first native token SCR <a href="https://x.com/Scroll_ZKP/status/1848354691605782731">airdrop</a> today, which is currently trading at a $1.15 million FDV.



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Preaching the Goatse gospel: A timeline

Bessie Liu

Scroll, the latest Ethereum layer-2 network, has launched on mainnet.



According to block explorer <a href="https://scroll-sepolia.l2scan.co/">data</a>, Scroll’s testnet counts more than 900,000 wallet addresses as participants and has seen an estimated seven million transactions since August. Scroll’s launch follows a year of testnet operation that has seen over 55 million transactions, the Scroll team told Blockworks.&nbsp;



<a href="https://blockworks.co/tag/scroll">Scroll</a> is a general-purpose zkEVM roll-up intended to marry Ethereum’s network security with lower fees and latency. 



Scroll co-founder Sandy Peng told Blockworks in an interview that existing <a href="https://blockworks.co/tag/ethereum">Ethereum</a> projects will be able to directly deploy their projects onto Scroll and utilize its <a href="https://blockworks.co/tag/zkEVM">zkEVM</a> technology. 



“The significance of zkEVM to developers lies in its ability to batch proofs in a highly efficient manner, offering faster transaction speeds at reduced costs. A key element in this process is bytecode-level compatibility,” Peng said.



Bytecode in computer programming is a language that simplifies complicated machine cryptography so that code can be more easily processed by computer hardware.&nbsp;



Deployed smart contracts will store the bytecode of their transactions on Scroll. These transactions will then be sent to a centralized zkEVM node that will prove that the state of the transaction is accurate without revealing the contents of the transaction.&nbsp;



Once the transaction is verified, the information will be published to Ethereum, updating the transaction’s state without the transaction being re-executed.



“Thanks to this feature, Ethereum devs can leverage all the same tools they are familiar with, ensuring that everything operates seamlessly right from the start,” Peng said.



Scroll’s mainnet code has been audited by four major auditing firms including: Zellic, Trail of Bits, OpenZeppelin and KALOS, Peng notes.



<h2 class="wp-block-heading">Path to decentralization</h2>



The Scroll team is currently in its “research” phase for its decentralized prover network and decentralized sequencer.



“In the current instantiation, the protocol will halt if the sequencer goes offline, and no back-up is available,” Peng said.&nbsp;



Peng notes that the team is currently working on a protocol upgrade that will enable “forced batches.”&nbsp;



This means that the protocol will allow the permissionless publication of batches through the base layer even in the case of a sequencer halt.&nbsp;



“Mid-term, the goal is to minimize the probability of a sequencer halt through decentralization,” Peng said.&nbsp;



Although in its current state, Scroll is upgradeable via a multi-signature wallet controlled by its core team, there are plans to introduce a Security Council and a delayed upgrade mechanism in the near future.&nbsp;



This means that the protocol will only be upgradeable if it receives approval from the Security Council, and the multisig team will only have the capability of initiating delayed upgrades, Peng explains. 



“We have been working on an SGX-based second prover with an external team of TEE experts for more than 6 months, which will soon enable us to have a functioning <a href="https://ethresear.ch/t/2fa-zk-rollups-using-sgx/14462">Multi-Prover</a> deployed on Scroll,” she said.



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Ethereum L2 Scroll launches on mainnet

Sebastian Sinclair

It’s been a slow start to the year for crypto businesses seeking fresh capital.



Industry-related firms globally netted $2.42 billion in venture capital over 374 deals throughout Q1, 2023, marking a notable decline in value for the fourth straight quarter.



The year’s first quarterly period witnessed a 20% decrease from the previous quarter in total deal value, from $3 billion to $2.4 billion, <a href="https://my.pitchbook.com/search-results/s284388313/deal_chart" target="_blank" rel="noreferrer noopener">data from Pitchbook</a> shows. That translated into roughly 5% less in deal numbers over the same period, from 394 to 374.



Investments have continued to fall following their peak 12 months ago, thanks largely to waning interest in digital assets and a number of scandals that continued to damage crypto’s image.



As it stands, this year’s second quarter is on track to clock a fifth consecutive decline in both deal count and value, standing at 129 and $867 million, respectively. It’s worth noting that there remain roughly 49 days left in Q2, or roughly seven weeks, to break that streak.



Despite the overall decline, there were a few positive developments at the beginning of the year, Pitchbook said in its &#8220;Emerging Tech: Crypto Report,&#8221; published Thursday.



Layer-2 scaling solutions, which aim to improve the scalability of crypto like bitcoin and ether, continued to attract significant investment.



Native zkEVM Ethereum layer-2, Scroll, which processes transactions off-chain, clinched a $50 million deal on March 6 with a post-money valuation of $1.8 billion.



Bitcoin scaling platform Blockstream also managed to raise $125 million in a late-stage deal on Jan. 24, valuing the company at $2.49 billion, data shows.



That’s still a far cry from 2021 and 2022’s biggest deals, including Fireblocks&#8217; $550 million later-stage VC in January of last year and Blockchain.com’s $490 million deal, three months later.



“We believe late-stage valuations are being skewed upwards, as we suspect that only outsized, up-rounds are being disclosed and down-rounds are being kept private,” Pitchbook said in its report.



“Additionally, Q1 2023’s sample size is small and represents only a single quarter of data. We expect rising seed and late-stage valuations to reverse throughout the year.”



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