What Is a Sovereign Rollup? Rollkit Pitches Second Layer for Bitcoin

Just a few months after the very first NFT was inscribed into Bitcoin, developers are trying to imbue the age-old blockchain with another new-age technology: rollups. 

At least that’s what Rollkit—a self-described “modular framework for rollups”—claimed over Twitter on Sunday, revealing a research integration that would allow “sovereign rollups” on Bitcoin.

According to Rollkit, its new rollup solution lets users produce rollups by retrieving and storing data on the Bitcoin blockchain. It was inspired by Ordinals, the Bitcoin NFT protocol which showed developers that—using Taproot—users could post arbitrary data to the blockchain.

In the traditional sense, rollups are batches of transactions that are “rolled up” off chain into one transaction, and then posted to Ethereum as a single on-chain transaction. This helps free up blockspace and lower transaction costs on the network, while still inheriting the settlement assurances of the base chain. 

A sovereign rollup is one that does not need a smart contract or use a settlement layer for validation—scalable and secure and with the "sovereignty" of a layer 1.

However, some proponents of Ethereum, a network known to use layer-2 “rollups” as a transaction scaling solution, have taken issue with Rollkit’s use of the term. 

Ryan Berckmans, a Web3 and Ethereum investor, said on Twitter that the sovereign rollup “is actually an alt L1 that stores its block data on Bitcoin.”

According to Alexei Zamyatin, founder of the Bitcoin DeFi protocol Interlay, sovereign rollups as proposed by Rollkit inherit “nothing” of Bitcoin’s security.

“Data availability—okay, but honestly, that's been used since 2012,” he continued. “The entire post describes 'I write some data to Bitcoin' with fancy buzzwords.”

Rollkit is still bullish on the possibilities.

“This new integration expands the possibilities for rollups, and also has the potential to help bootstrap a healthy blockspace fee market on Bitcoin, enabling a more sustainable security budget,” the company writes.

Some are likening sovereign rollups to Stacks, a high functionality layer 1 protocol that settles its blocks on the Bitcoin blockchain for security purposes. Stacks co-founder Muneeb Ali said on Twitter that this is an apt comparison, but noted some key differences.

On one hand, it takes 150 Stacks blocks before a transaction reaches”Bitcoin finality” on Stacks, but only 1 with sovereign rollups. On the other, Stacks blocks publish their data to Bitcoin in an efficient manner by merely hashing the data on-chain, whereas sovereign rollups publishes the full data. 

“The technically challenging part for both the Stacks layer and sovereign rollups is moving BTC in and out of the layer, said Ali. “The decentralized BTC peg is the most important part.”