Zero-Knowledge (zk) Rollups and Optimistic Rollups are revolutionizing Ethereum’s Layer 2 ecosystem by addressing key scalability, speed, and cost challenges. As Ethereum continues to face network congestion and high gas fees, these two rollup technologies provide innovative solutions to enhance transaction efficiency without compromising security. zk Rollups leverage zero-knowledge proofs to validate large batches of off-chain transactions almost instantly, ensuring fast finality, strong security, and potential privacy for sensitive transactions. Optimistic Rollups, on the other hand, operate on the assumption that off-chain transactions are valid and rely on fraud proofs to challenge any invalid activity, offering simplicity, broad compatibility with Ethereum smart contracts, and lower computational requirements. Both solutions significantly reduce gas fees, increase throughput, and enable the growth of decentralized applications (DeFi, NFTs, and cross-chain platforms) while maintaining trustless verification. Understanding the differences between zk Rollups and Optimistic Rollups including validation methods, transaction finality, complexity, privacy, and ideal use cases helps developers, investors, and users make informed decisions in the rapidly evolving blockchain landscape. Tokenomics also play a vital role, as network tokens incentivize validators, fund ecosystem development, and facilitate governance. Despite challenges like technical complexity, proof sizes, and finality delays, Layer 2 rollups represent the future of Ethereum scaling, enabling faster, cheaper, and more secure decentralized networks that drive mass adoption and innovation.