Reintegrate with the Ethereum economic zone

Author: gwilym, compiled by: Block unicorn

This year’s EthCC conference held in Cannes announced its first major development: the Ethereum Economic Zone (EEZ).

The project is led by the Gnosis and ziskvm teams and has received funding from the Ethereum Foundation. The goal of this initiative is to eliminate fragmentation within the Ethereum ecosystem. Let’s take a look at the current proposed plan.

Background

Layer 2 aims to expand Ethereum’s block space, and it has already achieved this goal. However, this expansion has also led to liquidity fragmentation. Tokens on platforms like Arbitrum, Base, Polygon, and others cannot directly interact with contracts on the L1 layer or other L2 layers unless bridged, which requires time and expense.

Of course, this is not a new insight.

For example, at Devcon SEA 2024, Gnosis co-founder Martin Köppelmann delivered a talk titled “Ethereum Needs Native L2s,” focusing on the various trust assumptions that hinder L2 interoperability. To address this, he called for developing zero-knowledge proof-based Rollups that can read and write in sync with Ethereum.

At the time, RYAN praised this concept as a vision for Ethereum 3.0. Today, the Ethereum Economic Zone (EEZ) project is actively inheriting that vision and working to turn it into reality.

While Köppelmann initially advocated for Ethereum-native Rollups, the new EEZ concept stems from his 2024 discussion and aims to achieve broader, permissionless interoperability. EEZ Rollups can be native and based on Ethereum, or they can be external and not based on Ethereum—depending on their architectural design.

Who is building EEZ?

Gnosis is a low-profile but powerful development team. It has created many iconic on-chain infrastructure components, such as the CoW protocol, Safe multisignature wallets, the Zodiac DAO architecture, the conditional token format powering Polymarket predictions, Gnosis Chain, Gnosis Pay, and more.

In the ZK space, Jordi Baylina’s team ZisK has innovatively developed an efficient open-source zkVM design that can provide real-time proofs for smart contract execution within the Ethereum ecosystem.

However, it’s important to note that no entity—whether Gnosis, ZisK, or others—“owns” the EEZ stack. The Ethereum Foundation is funding this initiative “as trusted, neutral, shared Ethereum infrastructure,” and its results will be released as free open source for everyone to use.

How EEZ works

In short, the Ethereum Economic Zone is a framework connecting L1 and L2 layers centered on synchronous composability (i.e., real-time interoperability).

In other words, a Rollup integrated with EEZ can call contracts on L1 or other L2 layers and receive responses within a single transaction. This enables atomic cross-chain execution, giving users the experience of interacting as if on a single chain.

Contracts on an EEZ chain will operate as if they are on the same chain. Transactions will be executed atomically within the relevant networks, or not at all if an error occurs.

Based on Baylina’s previous research, we can infer that the anchor point will be proxy smart contracts—contracts on one chain representing operations for contracts on another chain. If you’re using Ethereum, you only need to call a single proxy; the proxy will handle the transaction and apply state changes to the designated L2 layer, completing the process seamlessly.

Most notably, this shift from “single-chain user experience, multi-chain results” can be achieved without any protocol-layer changes to Ethereum itself, because EEZ relies on smart contracts and real-time zero-knowledge proofs.

Nevertheless, a key trade-off of adding an EEZ system on L2 is that when Ethereum undergoes reorganization, the L2s must reorg as well, as Martin Köppelmann has pointed out. While this presents a technical challenge, it is not insurmountable. Rollups running their own sequencers will need to adapt to this integration, which is feasible.

Importance

Imagine Aave positions on Ethereum interacting in a single transaction with a Uniswap pool on Unichain (or the Morpho vault on Base, or the Fluid vault on Arbitrum, etc.) without bridging.

This is the future that the EEZ project aims to lead. While some progress on hardware and verification is still needed before this vision can be fully realized, we are at a critical moment where breakthroughs are within reach.

The ultimate goal is further integration and dominance of Ethereum. As RSA said:

“If Ethereum can succeed—if it can integrate all its blockchains into a single, unified Economic Zone—and simultaneously roll out a streamlined Ethereum quantum upgrade and L1-level scaling…

Ethereum will gain unstoppable network effects.

It will ultimately fulfill its core promise.

Ethereum = the World Ledger.

ETH = the World Reserve Asset.”

This is the grand vision. So, as we wait for EEZ to officially launch, be sure to stay updated on the project’s latest developments and watch for new partners joining, because this alliance is just beginning.