Universal everyday payments seem so simple in traditional finance (TradFi). Simply swipe a card here, type a pin there, and voila! The payment is done. If the process is so simple, why is it seemingly so difficult to establish the same simplicity through Web3?

Ultimately, the goal is to establish the same ubiquitous nature of debit cards in blockchain technology, but this has been difficult, if not quite impossible, until now. Despite the security and immutability of the blockchain, the move towards more user-friendly interactions with everyday payments poses substantial hurdles ahead.

To actualize this goal and overcome the bottlenecks facing blockchain ecosystems today, a new standard must be set to ensure liquidity-free movement without compromising decentralization. However, first, Web3 must tackle the seemingly immovable obstacle to asset freedom and interconnection — composability.

Composability Exposed

When referring to composability of blockchain technology, it means the ability for different protocols and systems to cooperate and build harmoniously — without bottlenecks or limitations. As a fundamental part of decentralized finance (DeFi), composability enables many applications to work syncroniously in an efficient and interconnected fashion. 

However, the problem arises when we observe the current state of blockchain composability, in which there is of distinct lack of connection. This disconnect leads to a fragmented system, separated and reliant on modern solutions to inefficiently bridge the gap between blockchains, decentalized applications (dApps), and more. 

Worse still is that each blockchain, bridge or dApp often creates its own custom solutions — further disconnecting the space and reducing any chance of composability between chains. A simple example would be wrapped cryptocurrency assets, which represent assets on another blockchain. These wrapped assets, like wrapped Ether (ETH) on the Binance Smart Chain (BSC), which is not actually ETH — just a representation of it.

This divide in composability creates barriers to the movement of assets and liquidity access between blockchains, applications, and platforms which tells us one thing — a new standard is needed.

A New Standard

If there will ever be a day that Web3 assets can move a smoothly as finances through debit card everyday transactions, then a significant new universal standards must be created. Such a standard would need to enable value retention of assets without sacrificing functionality or requiring repeated reconfiguration to facilitate movement across different chain or dApp infrastructure.

In a similar way to how the Transmission Control Protocol (TCP) and Internet Protocol (IP) made it possible to establish universal communication across the internet — Web3 needs to find its own solution. By removing the complexities of cross-chain interactions and transactions for developers and users, Web3 will finally be able to move assets as easily and universally as debit cards.

Sumer.money is an example of such a protocol driving innovation in this field, working to address these composability challenges. Working to become the asset abstraction layer for Web3 through its omni-chain synthetic assets and money market protocol, Sumer.money allows users to deposit assets on on-chain and create synthetic versions of USD, ETH, and BTC. These synthetic assets can then be traded across multiple supported chains.

A TradFi example of how this works is similar to using a debit card where a user’s funds are located in their local bank, then made globally accessible without need for clunky monetary transitions.

Synthetic Solutions: Web3’s Obi Wan

Synthetic assets, like those created by Sumer.money, offer what could be the “only hope” for a solution to the Web3 composability problem. These synthetic assets can digitally represent real-world assets (RWAs) and other digital assets, without losing peg to their actual value. This enables protocols like Sumer.money to empower users with the ability to leverage their assets throughout the blockchain ecosystem — without hindrance or liquidity issues.

Sumer.money’s approach takes the best of synthetic solutions by depositing assets in a local space (the user’s specified blockchain) and creating synthetic assets from them that can travel freely across all supported chains. This utility assures liquidity never becomes trapped within the confines of single chain and opens up access to liquidity without traditional Web3 barriers.

Imagine depositing ETH on the Ethereum blockchain and using the created synthetic ETH on an entirely different chain to transact or yield farm — all the while, the original ETH is tucked securely in its native chain. With synthetic assets, this is possible.

Further enhancing synthetic solutions, Sumer.money utilizes a risk engine to intelligently underwrite user assets with liabilities based upon correlations to maximize capital efficiency. In layman’s terms, this means that every dollar locked in Sumer.money has the potential to unlock two dollars for partners and create further liquidity for a blockchain. This system improves liquidity and improves security in a more interconnected DeFi space.

Establishing the Universal Standard

The path ahead to creating an universal standard, similar to debit card everyday transactions, is a bumpy one fraught with hurdle after hurdles to overcome. Luckily for Web3, protocols like Sumer.money and the potential of synthetic solutions are working to turn what was once thought near-impossible into a reality. 

Innovators like Sumer.money are building a universal Web3 standard,  maintaining focus on composability between different blockchains and establishing an interconnected system through asset abstraction. With time and steady adoption, these kinds of composability solutions will enable future users to interact with assets without barriers across multiple chains in a world not plagued by fragmentation.

Through synthetic solutions, a universal standard can be achieved, reaching debit card level user-friendly in Web3 without having to climb through heaps of technical complexities. These solutions represent a positive step forward towards transitioning the versatility and connectedness of Web2 into the decentralized Web3 — it’s just a matter of time.