The Solana blockchain network has introduced a groundbreaking feature known as ZK Compression, which has been developed in collaboration between Light Protocol and Helius Labs. This new solution, launched on June 21, aims to drastically reduce on-chain storage costs by an impressive 99%. ZK Compression utilizes zero-knowledge (ZK) proofs to compress on-chain data, allowing developers to store vital data on Solana’s more cost-effective ledger space without compromising security or performance. By leveraging sparse state trees, a hash of off-chain data is stored on-chain for verification, ensuring data integrity and significantly reducing storage costs. According to Light Protocol, ZK Compression can reduce the cost of storing 100 compressed token accounts from the usual 0.2 SOL to about 0.0004 SOL, a remarkable 5000x reduction. For large-scale operations like airdrops to a million users, costs could plummet from $260,000 to just $50. Mert Mumtaz, the CEO of Helius, emphasized the enormous cost reduction and scalability advantages brought about by ZK Compression. Austin Federa, Solana’s Head of Strategy, also highlighted how this innovation addresses the high costs associated with on-chain account storage. He explained that ZK Compression offers similar cost-saving benefits for tokens and accounts as cNFTs did for NFTs, enabling the development of products that can attract more users to the blockchain. However, the new feature has faced criticism from some members of the Ethereum community. ZKsync founder Alex Gluchowski commented on the development, stating that the entire monolithic Solana thesis has been compromised, while Ethereum investor Ryan Berckmans labeled the approach as “unethical BS.” Additionally, other crypto community members, such as Adam Cochran, argue that the Solana compression tool is essentially a Layer 2 (L2) network but is being presented differently by its developers. Solana co-founder Anatoly Yakovenko defended ZK Compression, acknowledging its L2-like features but emphasizing its unique aspects. Unlike traditional L2 networks, ZK Compression does not require a security council multisig, chain ID switching, a governance token, or an external sequencer. Yakovenko stated that Solana validators still receive all the transaction fees, making it similar to an L2 without the drawbacks commonly associated with L2s.