RaaS: Deploying Rollups Made Easy
RaaS, or Rollup-As-A-Service, has emerged as one of the favourite options for smart-contract applications looking to make the transition to an appchain.
Rollups have become the norm nowadays. From Arbitrum and Optimism to zkSync and Scroll, everyone is looking for its share of the pie. Ethereum is going to be scaled by rollups, and we can expect a future with tens of different iterations, all with their own use cases and value proposition.
Until recently, creating and running a rollup was a difficult task which required deep knowledge and (a lot of) capital.
With the ongoing transition from the smart-contract application model to the appchain for maximum flexibility and unlimited growth, the demand for rollups and blockchains is booming. This has lead to the birth of a new product: Rollup-As-A-Service, or RaaS.
Put it simply, it allows anyone to launch a rollup in just a few clicks. Select a tech stack, choose your settlement and data availability layers, click deploy, and you are done. Yes, it’s really that easy.
This solution has already attracted many projects such as Aevo or Zora. Those applications needed their own infrastructure to follow their growth but did not have the resources and/or knowledge to do it internally. RaaS was the perfect solution for them.
RaaS Projects
AltLayer is probably the most complete product and is packed with tons of integrations like Espresso, Eigenlayer, Celestia, Hyperlane, and many more. What's even more intriguing is their recent introduction of restaked rollups. These rollups leverages Eigenlayer's restaking mechanism to achieve decentralized sequencing, higher security, and quicker transaction finality.
Conduit rollups give you a bit less freedom to customize than AltLayer ones. But Conduit is doing well, with big customers like Zora and Aevo already on board, showing that it's getting popular. Plus, being part of Paradign's network helps Conduit grow and brings in more customers.
Gelato, another RaaS project, makes it easy to deploy rollups with just a few clicks. It has established partnerships with Optimism, Polygon, Arbitrum, Celestia, and even Avail.
Other RaaS projects such as Caldera and Zeeve are also worth mentioning. While each project offers similar services, they vary in terms of customization and adoption rates.
Valuations
Currently, two RaaS projects have a token: AltLayer (ALT) and Gelato (GEL).
Gelato doesn't solely focus on RaaS; it also offers smart contract automation and a service to incorporate randomness on-chain, among other features. Thus, valuing it solely as a pure RaaS can be quite tricky.
Nevertheless, Gelato has successfully developed robust connections within the ecosystem, counting clients such as Maker DAO, Olympus, Beefy, and LayerZero among its partners for its automation services. With its strong network and skilled business development team, Gelato could clearly cross-sell its RaaS service to its existing list of clients.
Gelato is currently valued at a $150 million market capitalisation and $250 million fully diluted valuation. GEL has reached an ATH at $4.21 back in 2021, which is a 7x from here. However, the market capitalisation was only $40 million at that time. Looking at the chart, GEL has a clear resistance at $1, which, if flipped, could let the price runs substantially during this cycle.
Focus on a shinier coin now: ALT.
In a continuous upward trend since its Binance launch pool in January, AltLayer has a significantly high fully diluted valuation of $5 billion compared to its market cap of $560 million, with a significant unlock scheduled for July 2024. This unlock will substantially increase the circulating supply from approximately 1.89 billion tokens to 2.58 billion, representing a 36% (!) increase. These tokens are allocated within the Team, Advisors, and Investors' vesting portions. While we all know the adage saying that unlocks are bullish in a bull market, such a massive one will inevitably need to be priced at some point in the (near) future.
While offering a great technology that many projects will most likely use in the future, I am not a big fan of ALT as a token. I would rather wait for Conduit to determine whether a catch-up trade is possible or not.
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