May 2023: What’s Really Happening on Polygon zkEVM?
The metrics for Polygon zkEVM Mainnet Beta in the month of May reflect the network’s steady growth. Assets tied to DeFi protocols passed the $10M mark, and the total assets on the network are now over $18M. It’s worth mentioning that TVL is an incomplete metric: It often reflects price movements in the underlying assets more than user sentiment. There’s always more going on under the hood.
Over the last two weeks, gas optimizations have drastically reduced the cost of transacting on the network. Three weeks ago, a DeFi user paid $8.55 to compound a position. That same transaction cost $1.21 last week.
But for users who want to further optimize transaction and bridging fees, here is a collection of tips:
The gas optimizations and increased network activity have made Polygon zkEVM Mainnet Beta among the cheapest Layer Two rollups, according to L2 Fees.
There is now a native dashboard for high-level metrics for Polygon zkEVM, including average gas fees, TVL, and wallets, among others.
Activity follows liquidity. Assets bridged to the network grew 7X, between April 24 and May 29, to over $18M. According to DeFiLlama, assets tied to DeFi protocols grew in lockstep, with TVL on QuickSwap +1,00% in the 30-day period ending May 29.
That liquidity came slowly, and then all at once. Between May 15 and May 17, $5M in new assets were bridged to Polygon zkEVM Mainnet Beta.
Activity, in turn, leads to lower fees. Unlike Ethereum, rollups become cheaper as activity increases. That’s because the cost of generating proofs is amortized across all the transactions in a batch. More transactions means more users sharing the cost of proof generation.
Over the last 30 days, single-day transaction volume broke all-time highs several times. On May 25, Polygon zkEVM Mainnet Beta processed more than 25k transactions.
Lower fees and more liquidity then leads to more users. From April 25 to May 25, unique active wallets grew by 54%, with the sharp increase following the new assets bridged on May 15.
Overlapping the weekly transaction volume with average gas fees shows this feedback loop: liquidity generates more transactions, more transactions generate lower fees. Lower fees, in turn, generate smaller-margin opportunities, which then stimulate more activity.
Polygon zkEVM Mainnet Beta continues to grow steadily. In the coming months, Polygon Labs will share the roadmap for data compression and EIP - 4844, which will help reduce fees on the network by several orders of magnitude.
Tune into the Polygon Labs blog and the social channels to stay up to date on the latest from the Polygon ecosystem.