Fraud Proof of Ethereum Rollup

A fraud proof in Ethereum rollups is an interactive on-chain challenge mechanism that disputes invalid off-chain transaction states in optimistic rollups, enforcing correctness through economic penalties.

What is Fraud Proof of Ethereum Rollups?

Fraud proofs, also termed fault proofs, underpin optimistic rollups on Ethereum by assuming off-chain transaction batches are valid unless contested. A sequencer aggregates hundreds of digital asset transfers—up to 1,000 per batch in Arbitrum One—executes them in an Optimistic Virtual Machine (OVM), and posts a state root (Merkle root hash) plus compressed calldata to Ethereum. During a fixed challenge window, typically 7 days, any watcher node can submit a fraud proof by replaying the disputed computation on-chain via the rollup’s verifier contract. If valid, this bisects the faulty segment using a binary tree of Merkle proofs, isolating errors like incorrect opcode execution, and reverts the state while slashing the sequencer’s stake (e.g., 1-10 ETH bond).

This reactive system contrasts with ZK-rollups’ upfront validity proofs, prioritizing simplicity and EVM compatibility over immediate finality. In Optimism’s Bedrock upgrade, fraud proofs use single-round interactive verification, costing around 300,000 gas per challenge, with multi-round protocols in Arbitrum Nitro reducing disputes to under 1% of batches. Economic incentives deter spam: challengers bond collateral, refunded plus rewards (up to 50% of the penalty) on success, fostering a game-theoretic equilibrium where honest monitoring prevails.

Implemented in production since 2021, fraud proofs have secured over $20 billion in TVL across chains like Base and Scroll, with real-world disputes rare—Arbitrum resolved its first in 2023 via a 2-round proof, confirming a state mismatch in under 24 hours. Drawbacks include withdrawal delays (7-day wait for L1 exits) and potential centralization risks if few watchers participate, though decentralized fault-proof committees in OP Stack v2 aim to mitigate this by distributing verification across 10+ nodes.

ZK proof vs fraud proof in Ethereum Rollups

	ZK Proof (ZK-Rollups)	Fraud Proof (Optimistic Rollups)
Validation Approach	Proactive: Prove every batch valid upfront	Reactive: Assume valid, challenge if fraudulent
Proof Type	Cryptographic (zk-SNARK/STARK)	Interactive on-chain replay (Merkle-based)
Finality Time	Instant (~12 seconds post-verification)	7-day challenge window
Gas Cost per Batch	~200k for proof verification	Minimal posting; ~300k per challenge
Privacy	High (hides transaction details)	Low (full calldata on-chain)
Examples	zkSync, Starknet, Polygon zkEVM	Arbitrum, Optimism, Base
TVL (as of Sep 2025)	~$15B combined	~$25B combined