In the DeFi Summer of 2020, a large number of high-quality DeFi projects have emerged. In this summer’s feast, the ecology of a few EVM public chains has gradually prospered. This DeFi feast has basically established the current DeFi paradigm. In recent months, market sentiment has continuously shifted to new networks, and new networks have emerged one after another. When one day in the future we stand in the prosperous world of the multi-chain era and look back, we may find that this summer that has passed is the MultiChain Summer that established the paradigm of the multi-chain era.
We are already in a multi-chain era. From the alternative Solana to Avalanche and Fantom, the ecology of the new public chain is booming. According to data from DefiLlama, there are 10 networks with a lock-up volume higher than US$1 billion, 28 networks with a lock-up volume higher than US$100 million, and there are still a large number of networks still under development or online but the lock-up volume is low .
In the multi-chain era, asset intercommunication has become a rigid demand, and cross-chain bridges have become one of the most important infrastructures. This article will give a quick overview of the multiple cross-chain protocols available in the market.
As an established cross-chain protocol, REN is quite different from other Bridge products. This protocol does not support the multi-chain mutual transfer of a specific asset, but locks the native assets on mainstream non-EVM chains such as BTC and then mints ren tokens on other networks. The renBTC on Ethereum is generated by this protocol. The operation of this protocol is cumbersome, and it is quite different from most cross-chain bridge operation logic.
The assets that can be minted under the REN protocol are all native assets on the non-EVM chain, including BTC, BCH, DOGE, ZEC, DGB, FIL, LUNA . The minted ren token can be received on Ethereum, BSC, Fantom, Polygon, Avalanche, Solana, Arbitrum networks.
“ETH-New Network” Bridge
The deployment of every new network will face the problem of lack of assets, and every deployment of a new network requires the entry of assets in order to bring the development momentum to the network. Generally speaking, the project foundation will develop a cross-chain bridge that only supports ETH to communicate with its own network. This is also the initial infrastructure after the deployment of the new network.
Take WormHole as an example. WormHole is the first cross-chain bridge that supports cross-chain to Solana, with a total contract lock-up volume of US$200 million. In addition to providing Token cross-chain, WormHole also provides NFT (ERC721) cross-chain function. However, it should be noted that the bridge only supports the crossover between Solana and Ethereum, and does not support other networks. Considering Ethereum’s high gas price, the cost of using the bridge is not cheap.
Except for WormHole, every new network has similar products. For example, there are AVAX official bridges in the Avalanche network, Polygon official bridges in Polygon, Optics bridges in Celo network, Orbit bridges in klaytn network, Arbitrum official bridges, and so on.
Limited by the high gas cost of ETH, the infrastructure of such a single network is usually not frequently used by most ordinary users. Once the network takes shape and some multi-chain cross-chain bridges support the new network, such official bridges are no longer the first choice for most users.
O3 Swap is a unique product in the cross-chain solution. Through aggregation and cross-chain, it realizes the liquidity of assets between different blockchains. O3 Swap supports Ethereum, BSC, Heco, Polygon, NEO networks, and the Arbitrum network will be launched on October 15. Through the O3 Hub, a cross-chain transaction pool based on the Poly network cross-chain protocol, users can use it to implement transactions of different blockchain assets, and they can also choose to provide liquidity for the cross-chain pool to receive O3 rewards.
When users actually operate cross-chain, most cross-chain protocols can only realize the circulation of the same asset between different chains. This is not the case with O3 Swap, which can realize the circulation of different assets between different chains, that is, the token X is transferred from the A network and the token Y is received on the B network, eliminating one step of transaction and reducing one step of operation.
The protocol receives a proportional income fee, and the cost of each cross-chain operation is 0.3%, which does not have a big advantage compared with other cross-chain protocols. It should be noted that O3’s cross-chain transaction pool is based on the Poly network cross-chain protocol. Earlier, Poly Network stolen US$610 million, and O3 was affected.
As the name suggests, AnySwap supports many networks, including both EVM compatible chains and non-EVM chains, and even BTC and LTC networks. Its supporting networks include more than ten networks including ETH, BSC, FSN, FTM, MATIC, Heco, AVAX, X DAI , Arbitrum, KCC, OKT, ONE, MOVR, ETH Goerli, IoTeX, and SDN. This cross-chain bridge may be the cross-chain bridge with the most coverage in the DeFi market.
The types of assets supported by the bridge are also quite rich, which can meet the needs of most users. AnySwap cross-chain fee is charged proportionally and fixed at 0.1%. However, a single transaction fee has an upper limit and a lower limit. Taking USDC as an example, the cross-crossing transaction fee between EVM compatible chains of non-ETH mainnet can be less than 1USDC.
Allbridge is developed by APYSwap and supports multiple networks of Ethereum, BSC, Polygon, Avalanche, HECO, and Celo. The advantage of Allbridge is that only one signature is required for confirmation, and the transaction fee is low.
Unlike most Bridges that only support EVM, this Bridge can connect to EVM and non-EVM networks, and it is also a rare support designed to develop into a DAO-style multi-chain center. DeFiLlama data shows that Allbridge currently locks up about $15.5 million.
Unlike most cross-chain bridges that charge a proportional fee, the bridge charges a fee based on the number of transactions. Taking Solana cross-chain Celo as an example, the cross-chain USDC token only charges 0.25 USDC at a time, which is extremely low.
Although the cross-chain bridge has a low cost of use and supports multiple networks, the bridge supports fewer assets. Most networks only support APYS and KRW assets. Even mainstream assets such as wETH and USDC lack support in most networks. . With a complete network but lack of assets, AllBridge can only be called easy to use in a few specific usage scenarios.
cBridge was developed by Celer. The bridge avoids the payment of fees to the underlying cross-chain bridge every time it cross-chains, simplifies cross-chain steps and reduces transaction costs through state channel-based technical means. The bridge can realize the instant payment from Layer 1 to Layer 2 without having to go through a waiting period of up to 7 days or even 1 month.
On October 9th, cBridge official data showed that it has helped users cross-chain funds up to 400 million U.S. dollars. Celer recently released a major upgrade plan for the cBridge 2.0 version. It will launch cBridge 2.0 in phases to support more applications such as cross-chain NFT and cross-chain DEX. At the same time, it will continue to support more cross-chain and cross-layer transfers of Layer 2 and Layer 1 blockchains.
cBridgec supports cross-chain transmission across EVM compatible chains. Currently, the cross-chain functions of Ethereum, BSC, Polygon, Arbitrum, xDai, Fantom, Avalanche, Optimism, OKExChain, and Heco are open. The advantage of this bridge is that it supports most mainstream assets and mainstream EVM compatible chains, but does not support non-EVM chains such as Solana.
In terms of fees, the bridge only needs to pay the processing fee of the relay node, and the handling fee is charged according to the number of transactions, and the operating cost is low.
Hop Exchange is committed to improving the liquidity in the Ethereum Layer 2 network. This is a Rollup-to-Rollup general token circulation bridge. The bridge currently supports the Ethereum mainnet, Optimism, Arbitrum, Polygon, and xDai. Supports four assets: USDC, USDT, MATIC, and DAI. At present, this project is still relatively early, and the number of networks and asset types it supports are not outstanding.
This bridge is designed with “hAssets” as intermediate assets and combined with the AMM mechanism to achieve rapid circulation between Rollups. When cross-chain, assets are deposited in the contract 1:1 mortgage to cast hAssets, and assets are redeemed to destroy hAssets, so as to achieve rapid communication between Rollups.
The best cross-chain bridge is always the next cross-chain bridge
In addition to the several bridges mentioned above, there are more cross-chain bridges that have not been elaborated due to limited space, and the design of these products is not inferior.
The functions of cross-chain aggregators like Li.Finance and XY Finance are more than bridges. They aggregate cross-chains and transactions, allowing users to exchange any token from any (supported) chain to another arbitrary token on another chain. . This function reduces the transaction process and improves the liquidity between chains.
Biconomy is working to provide tools that allow dApps to be inserted into the cross-chain ecosystem. They want to ensure the simplicity and ease of use of decentralized applications without having to understand the lower-level technical logic such as private key wallets. Currently, Biconomy’s cross-chain bridge is only deployed on the test network.
Connext adopts the technical route of “relay node + contract” local verification similar to cBridge and Hop, and realizes fast real-time cross-chain through a liquidity pool. The product is still working on better composability and user experience, and the cross-chain aggregator Li Finance has been established on Connext.
In the current multi-chain era where various Layer 2 solutions are contending, and the ecological fragmentation of Ethereum is becoming more and more serious, cross-chain bridges are moving towards a safer, more interconnected, faster, more capital efficient, cost-effective and censorship-resistant era. Direction development. The speed of development of the infrastructure of the cross-chain bridge is unprecedented, and innovation is always going on. The best cross-chain bridge will always be the next cross-chain bridge.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/in-the-multi-chain-era-how-to-choose-the-bridge-that-suits-you-best/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.