A rollup is a type of layer 2 scaling system that bundles many transactions together and posts compressed data or proofs back to a base blockchain.
How It Works
Rollups process transactions off the main chain, then submit summaries to the base layer. Optimistic rollups assume transactions are valid unless challenged, while zero-knowledge rollups use cryptographic proofs to verify correctness.
By batching activity, rollups can lower fees and improve throughput while still relying on the base chain for security or settlement.
Why It Matters In Crypto
Rollups matter because they are one of the main ways Ethereum and other smart contract platforms scale. They let more users interact with DeFi, games, and apps without every action happening directly on the base layer.
A practical example: a DeFi user can swap tokens on a rollup with lower fees, while the rollup eventually settles its state back to Ethereum.