Ethereum-based DeFi solution MakerDAO will reduce transaction costs by onboarding a layer 2 sidechain
The protocol is known as StarkNet and integration will happen in four phases. April 28 has been scheduled for phase one deployment
The update will also optimize transaction speeds for MakerDAO’s stablecoin – DAI
It’s another step in the project’s multichain expansion roadmap
Decentralized finance (DeFi) lending protocol MakerDao announced plans to integrate the StarkNet sidechain as part of its multichain expansion strategy. Adding support for the layer 2 solution will increase transaction speeds up to 10x, according to MakerDAO.
Also, integrating StarkNet will allow DAI users to finalize transactions with significantly cheaper fees compared to the notorious high gas costs due to overflowing demand on Ethereum’s network. The move is reportedly strategic and aligns with the DeFi giant’s ambitions aimed at delivering multichain operability and gas-efficient crypto transfers.
Built by Netanya-based blockchain infrastructure developer StarkWare, StarkNet functions as an Ethereum-powered layer 2 solution. The protocol scales transactions on the blockchain by leveraging zero-knowledge technology.
MakerDAO’s Four-Step Integration Plan
According to the MakerDAO team, onboarding StarkNet’s ZK rollups will happen in four phases. The current timeline for the upgrade runs from Q1 2022 to Q1 2023.
Firstly, the DeFi heavyweight will deploy a simple token bridge designed for DAI stablecoin transactions. This bridge is scheduled to go live on April 28, 2022. Afterward, the team will add operability between layer 2 and layer 1 to facilitate speedy withdrawals before the end of Q2 2022.
For the third phase and Q3 2022, MakerDAO will deploy support for DAI teleporting between layers by leveraging a Wormhole design. In the fourth and final phase, the DeFi OG protocol will unveil complete multi collateral DAI (MCD) by Q4 2022 or Q1 2023. The team said MCD will deploy fully on StarkNet’s sidechain, giving DAI users wider operability and utility.
The team emphasized that the StarkNet integration is another milestone on the road to achieving comprehensive multichain functionality. Two other Ethereum-based scaling protocols, Arbitrum and Optimism, were previously onboarded by the DeFi heavyweight as well.