Quiz: Layer 2 Scaling: Rollups, State Channels, and Sidechains
Multiple Choice
1. Ethereum processes approximately how many transactions per second on Layer 1?
- A) 1-3 TPS
- B) 15-30 TPS
- C) 150-300 TPS
- D) 1,500-3,000 TPS
Answer: B. Ethereum processes approximately 15-30 TPS on Layer 1, constrained by its block gas limit and block time. This is over 2,000x lower than Visa's peak capacity.
2. What is the primary reason that simply increasing block size does not solve the blockchain scaling problem?
- A) Larger blocks take longer to hash
- B) Larger blocks require more storage, raising full node hardware costs and reducing decentralization
- C) Larger blocks are rejected by the consensus algorithm
- D) Larger blocks increase transaction latency
Answer: B. Larger blocks increase the hardware requirements (bandwidth, storage, computation) for running a full node, which reduces the number of participants who can afford to validate the chain, thereby reducing decentralization.
3. Which of the following best describes the core principle of Layer 2 scaling?
- A) Replace the Layer 1 blockchain with a faster one
- B) Execute transactions off-chain while using the main chain for verification and settlement
- C) Increase the block size on the main chain
- D) Reduce the number of validators to speed up consensus
Answer: B. All L2 solutions move execution off-chain while leveraging the main chain's security for verification, dispute resolution, or settlement.
4. In an optimistic rollup, the "optimistic" part refers to:
- A) The assumption that gas prices will decrease over time
- B) The assumption that transactions are valid unless someone proves otherwise during the challenge period
- C) The use of optimized compression algorithms
- D) The positive outlook on blockchain adoption
Answer: B. Optimistic rollups are "optimistic" because they assume all posted state transitions are correct and rely on fraud proofs submitted during a challenge period to detect and punish invalid state claims.
5. What is the typical challenge period for an optimistic rollup?
- A) 1 hour
- B) 24 hours
- C) 7 days
- D) 30 days
Answer: C. The standard challenge period for optimistic rollups (both Arbitrum and Optimism) is approximately 7 days, during which any observer can submit a fraud proof if they detect an invalid state root.
6. Arbitrum's fraud proof system uses which approach?
- A) Non-interactive single-round proof — the entire computation is replayed on L1
- B) Interactive bisection protocol — challenger and asserter narrow the dispute to a single instruction
- C) Zero-knowledge proof — a validity proof is generated for the disputed state transition
- D) Multisig validation — a council of validators votes on the correct state
Answer: B. Arbitrum uses an interactive fraud proof (bisection protocol) where the challenger and asserter iteratively bisect the computation until they isolate a single instruction of disagreement, which is then executed on L1.
7. What security assumption must hold for an optimistic rollup to be secure?
- A) A majority of validators must be honest
- B) At least one honest participant must be watching and willing to submit fraud proofs
- C) The sequencer must be decentralized
- D) All users must run full nodes
Answer: B. This is the "1-of-N" assumption: only one honest watcher is needed to detect and challenge an invalid state root during the challenge period.
8. Which of the following is TRUE about ZK-rollups compared to optimistic rollups?
- A) ZK-rollups have a 7-day challenge period
- B) ZK-rollups require less computational power to generate proofs
- C) ZK-rollups achieve faster L1 finality because validity proofs are verified immediately
- D) ZK-rollups have better EVM compatibility in all current implementations
Answer: C. Because ZK-rollups submit a mathematical validity proof with each batch, the state is considered final as soon as the proof is verified on L1 — there is no challenge period. However, proof generation is computationally expensive.
9. STARKs differ from SNARKs in that:
- A) STARKs require a trusted setup ceremony; SNARKs do not
- B) STARKs produce smaller proofs than SNARKs
- C) STARKs do not require a trusted setup and are potentially quantum-resistant, but produce larger proofs
- D) STARKs are only used for payment channels, not rollups
Answer: C. STARKs (used by StarkNet) are "transparent" — they require no trusted setup — and rely on hash functions rather than elliptic curves, making them potentially quantum-resistant. The tradeoff is larger proof sizes.
10. In a state channel, what prevents one party from submitting an old (outdated) state to the on-chain contract?
- A) The contract only accepts states signed by a third-party arbitrator
- B) Each state update includes a nonce (sequence number), and the other party can submit a more recent state with a higher nonce during the dispute period
- C) Old states are automatically invalidated by the blockchain
- D) State channels do not have this problem because all states are stored on-chain
Answer: B. The dispute resolution mechanism relies on nonces: the on-chain contract accepts the state with the highest nonce, and the other party has a dispute window to submit a more recent state if their counterparty tries to cheat.
11. Which of the following is a fundamental limitation of state channels?
- A) They cannot process transactions faster than Layer 1
- B) They require both parties (or their watchtowers) to be online to prevent fraud
- C) They require zero-knowledge proofs for every transaction
- D) They are incompatible with all existing blockchains
Answer: B. If a party goes offline and their counterparty submits an old state, the offline party must respond during the dispute period or risk losing funds. This "liveness requirement" is a core limitation.
12. What distinguishes a sidechain from a rollup in terms of security?
- A) Sidechains use Proof of Work; rollups use Proof of Stake
- B) Sidechains have their own independent validator set and do not inherit L1 security; rollups derive their security from L1
- C) Sidechains are faster but more expensive than rollups
- D) There is no meaningful security difference
Answer: B. This is the critical distinction. A rollup's security is anchored to L1 — even if all rollup operators are malicious, users can verify state and force-withdraw via L1. A sidechain depends on its own validators, and if they are compromised, users have no L1 recourse.
13. The Ronin bridge hack of March 2022 resulted in $625 million stolen. This attack exploited:
- A) A bug in the Ethereum Virtual Machine
- B) Compromising a majority (5 of 9) of the sidechain's bridge validators
- C) A flaw in the zero-knowledge proof system
- D) A data availability attack on an optimistic rollup
Answer: B. The attacker compromised 5 of 9 validator keys for the Ronin bridge, giving them the ability to authorize fraudulent withdrawals. This type of attack is specific to sidechain/bridge architectures and would not affect a rollup.
14. EIP-4844 (Proto-Danksharding) reduced L2 transaction costs primarily by:
- A) Increasing the Ethereum block size
- B) Introducing a new data type (blobs) with a separate fee market, so rollup data no longer competes with regular transactions for block space
- C) Reducing the gas cost of all Ethereum operations by 90%
- D) Moving Ethereum from Proof of Work to Proof of Stake
Answer: B. EIP-4844 introduced blob-carrying transactions with a separate fee market. Rollups post data as blobs instead of calldata, dramatically reducing costs because blob space is priced independently from execution gas.
15. The "modular blockchain thesis" argues that:
- A) All blockchains should use the same consensus mechanism
- B) Blockchain functions (execution, settlement, data availability) should be separated into specialized layers rather than handled by a single monolithic chain
- C) Layer 2 solutions should be abandoned in favor of faster Layer 1 chains
- D) Every application should have its own dedicated blockchain
Answer: B. The modular thesis advocates for specialization: rollups handle execution, L1 handles settlement, and dedicated DA layers (or L1 blobs) handle data availability, with each layer optimized for its specific function.
16. Celestia is best described as:
- A) A Layer 2 rollup on Ethereum
- B) A purpose-built data availability layer that orders and guarantees data availability using Data Availability Sampling
- C) A sidechain that competes with Ethereum
- D) A zero-knowledge proof generator for rollups
Answer: B. Celestia is a specialized data availability layer. It does not execute transactions or settle disputes — it provides a bulletin board for rollup data, using DAS to allow light nodes to verify availability.
17. In the L2Beat Stage classification, a "Stage 1" rollup:
- A) Has no proof system and operates entirely on a multisig
- B) Has a functional proof system but retains a Security Council with emergency intervention powers
- C) Has a fully autonomous proof system with no possibility of human override
- D) Has decentralized its sequencer but not its prover
Answer: B. Stage 1 means the proof system works but a Security Council can intervene in emergencies (e.g., to fix bugs). This is an intermediate step between Stage 0 (full training wheels) and Stage 2 (no training wheels).
18. Which of the following is the BEST description of data availability in the context of rollups?
- A) Whether the rollup's website is accessible
- B) Whether the transaction data underlying a posted state root is publicly accessible so anyone can verify the state
- C) Whether the rollup stores data in a decentralized database
- D) Whether historical transaction data is archived permanently
Answer: B. Data availability means that the raw transaction data is available for anyone to download and use to reconstruct the rollup state. Without data availability, a malicious operator could post an invalid state root and withhold the data needed to challenge it.
19. Which Layer 2 approach is MOST appropriate for high-frequency, small-value payments between two parties who regularly transact?
- A) Optimistic rollup
- B) ZK-rollup
- C) State channel
- D) Sidechain
Answer: C. State channels offer instant finality, zero per-transaction fees, and privacy for exactly this use case — frequent, bidirectional payments between known parties. The Lightning Network is the canonical example.
20. A user has assets on Arbitrum (an optimistic rollup) and wants to use a dApp on StarkNet (a ZK-rollup). Which of the following BEST describes the current state of L2 interoperability?
- A) Assets can be moved instantly between any two L2s at no cost
- B) The user must typically bridge through L1 or use a cross-L2 bridge service, incurring fees and delays
- C) L2 interoperability is impossible — assets are permanently locked on the chain where they were deposited
- D) All L2s share a unified state, so no bridging is needed
Answer: B. L2 fragmentation means users must bridge assets between chains, typically through L1 (slow and expensive) or through cross-L2 bridge services (faster but with additional trust assumptions and fees). This is an active area of development.