Recently, the cross-chain interoperability L1 public chain @zetablockchain released an airdrop, which attracted market attention to the "chain abstraction" track. What is chain abstraction, what are the difficulties in full-chain interoperability, and what are the core features of ZetaChain?
In my opinion, if modularization is a "vertical integration" strategy, then chain abstraction is a "connection horizontal" strategy, which is one of the key tracks that must be paid attention to in 2024. Why, next, let me talk about my understanding:
Whether vertical or horizontal, it is an "alliance" strategy. Modularization is a comprehensive public chain that combines idle blockchain development capabilities in the form of Modular components to compete with Monolithic.
Chain abstraction connects the liquidity scattered among chains in the form of interoperability integration to enhance the experience of developers and users.
What is chain abstraction? The co-founder of Near recently put forward the concept of "chain abstraction". Simple understanding: modularization separates the different functional layers of the blockchain into settlement layer, DA layer, execution layer, rollup layer, etc. This has greatly stimulated the chain construction market. prosperity, but at the same time, it will make liquidity, applications, users, etc. between chains more dispersed, which will bring huge barriers to ordinary users and even developers.
"Chain abstraction" is to solve interoperability problems such as cross-chain communication, asset transfer, and cross-chain smart contract calls between different chains by building a universal all-purpose smart contract.
There are two main types of common full-chain interoperability issues:
1) Communication issues between non-similar smart contract chains. For example, how to establish effective communication connections between UTXO non-smart contract platforms such as Bitcoin and account smart contract platforms such as Ethereum?
2) The problem of non-Wrap method transfer of cross-chain assets. The Wrap method is a common cross-chain bridge solution, but the handling fees and other frictions of this type of solution cause huge capital losses and are usually accompanied by large multi-signatures of assets. Manage centralization risks.
So, can ZetaChain solve these two problems, and how?
ZetaChain is a proof-of-stake blockchain built on the Cosmos SDK and Tendermint PBFT consensus engine. Think of it as an application-specific blockchain framework for interoperability.
In layman's terms, it is a "chain within a chain", which adopts a "blockchain of blockchains" (BOB) method, in which a specific chain is embedded into the full chain environment to provide a framework for data, network, consensus, incentives and contract layers. Enable interoperability between blockchains.
The core architecture of ZetaChain is mainly divided into: verifiers, observers, and signers.
Verifiers can verify the consensus of the maintenance chain by pledging ZETA tokens. For example, the state transfer of other chains submitted by observers needs to be confirmed by the vote of the verifiers, so the verifiers can obtain certain token incentives;
The observer's responsibility is to monitor the full nodes of the external chain to synchronize specific transaction logs, transfer events and status information, and synchronize the information to the verifier who determines the consensus;
The signer is mainly responsible for confirming the identity of the external chain. When it comes to asset circulation requests, the signer can participate in asset signing to ensure safe cross-chain interoperability of assets.
Based on these basic frameworks, ZetaChain can effectively solve the above-mentioned full-chain interoperability issues:
1) When it comes to asset circulation between the EVM chain and the UTXO model chain, since the Bitcoin network does not have smart contracts, the only effective way is to deploy light nodes and perform MPC multi-party signature operations based on the ECDSA signature algorithm. Since ZetaChain can hold TSS Private keys and addresses, so you can use smart contracts on ZetaChain to connect and manage local assets on the Bitcoin network.
Throughout the process, ZetaChain observers must effectively track and manage the UTXO on Bitcoin. The core logic is to use Bitcoin as an asset settlement layer to achieve effective control and circulation of assets through a multi-signature algorithm;
2) The current common cross-chain bridge solutions are based on the logic of locking assets in chain A and issuing additional assets in chain B. This interaction premise will not only lock the liquidity of a single chain, but also cause asset loss during the wrapping process. When it comes to DeFi-related application scenarios, it is often criticized for its asset loss.
In response to this, ZetaChain built a full-chain Ominichain smart contract and created the ZRC20 token standard. This enables ZetaChain’s full-chain asset circulation to be based on non-Wrap status.
Popular understanding: ZetaChain is equivalent to the chain-in-chain settlement layer in a full-chain environment. Chain A initiates an asset transfer to chain B, which is equivalent to chain A first "settling" with ZetaChain, and then the settlement status is synchronized to chain B, and chain B will receive This corresponds to the use rights of ZRC20 tokens, and there is no Wrap asset loss and friction in the entire process.
3) Based on the atomic transaction characteristics of smart contract management, the external chain can use native assets. For example, a cross-chain AMM decentralized exchange can be implemented based on this feature. The general logic is: the assets on each chain are first paired with ZETA. If you want to exchange asset X on chain A with asset Y on chain B, , you can first use the fund pool on the A chain to exchange X for ZETA, then transfer the ZETA cross-chain information on the A chain to B, and then convert the ZETA on the B chain into Y through the Y/ZETA trading pair.
This is very different from trading on different chains and then trading across chains again. It directly reduces transaction slippage and cross-chain losses, which is of great benefit to the cross-chain deployment and application of DeFi protocols.
that's all
Through the technical analysis of ZetaChain, everyone can more or less perceive the significance of "chain abstraction" to the current blockchain ecology:
For B-side developers, it can reduce the cost of deploying various protocols across chains and manage liquidity in a full-chain environment, which not only unifies market management but also reduces security risk exposure, especially in modular combinations of multi-chains. In this era, the full-chain interoperability solution will become a necessary supplement;
For C-side users, chain abstraction will simplify the relationship between users and various back-end protocols into the interaction between users and DApp applications. Even users can achieve a full-chain interactive experience by directly interacting with the wallet. The wallet serves as the user's complex intent intent. The Solver processing center can be used.
Note: The interoperability track, that is, the chain abstract track will be one of the hottest directions in 2024. Currently, the projects covered by my personal research include @zetablockchain @ParticleNtwrk @Entanglefi @NEARProtocol, etc. It is worth continuing to pay attention to this track. trends