Deutsche Bank Unveils ZKsync-Based Layer 2

Deutsche Bank has unveiled Project Dama 2, a test version of a Layer 2 platform leveraging ZKsync to address regulatory concerns surrounding the use of public blockchains.

What's the scoop?

• ZKsync Technology: Developed with Memento Blockchain and Interop Labs, Dama 2 employs ZKsync for scalability and privacy, while remaining connected to Ethereum.
• Regulatory Collaboration: The project is part of Singapore’s Project Guardian, with 24 institutions exploring asset tokenization.
• Launch Plans: A minimum viable product is expected next year, pending regulatory approval.

Bankless Take:

Deutsche Bank’s use of a custom L2 proves to be an interesting solution for banks to mitigate concerns like unknown validators and transaction fees reaching sanctioned entities, while still maintaining a path for integration to Ethereum at a larger scale. Notably, the curated validator lists and regulator-specific admin rights highlight the push toward permissioned blockchain solutions tailored to traditional finance. As more institutions look to onboard to Ethereum and venture into tokenization, we can expect to see major institutions develop their own permissioned environments from which to interact with the rest of the network.