By Paul Timofeev, Shoal Research
Translated by: Yangz, Techub News
Decentralized applications refer to blockchain-native products and services that have been around since the advent of smart contracts and Ethereum. However, user adoption of decentralized applications has been slow relative to Web2 applications and services. The convenience and choice brought by Netflix's transition from physical DVD rentals to digital and streaming services enabled it to surpass Blockbuster. The convenience of "the world at your fingertips" brought by smartphones has promoted the adoption of mobile applications, changed the way people interact with the Internet, and greatly benefited social networks. In the current AI environment, ChatGPT surpassed Instagram and Tiktok to become the fastest growing application, providing a simple and powerful way to utilize AI for almost everyone through a simplified chatbot user experience using natural language processing (NLP). What these breakthrough products and services and their success have in common is that they provide a better user experience than any incumbent or competitor. For decentralized applications to achieve similar success, the on-chain user experience must also be as seamless and convenient as possible, away from the various mnemonics and fragmented blockchain ecosystems that are common today.
Changing the on-chain user experience
The ultimate goal of the on-chain user experience is to allow anyone to do anything on any blockchain without the need for users to understand any underlying blockchain infrastructure, without complex barriers and subsequent cumbersome cross-chain processes. In order to better understand the significance of this design, it is necessary to understand the current on-chain account status below. The on-chain account is a bridge between the user and the blockchain, storing assets on the chain and defining all activities and interactions with any blockchain native program. As of now, most blockchains adopt the externally owned account (EOA) model, which consists of two parts, including a public key (wallet address) as an identity and reference point for receiving assets and a private key (mnemonic) as a master password for access. Technically speaking, the wallet acts as an account abstraction service that simplifies the management of one or more on-chain accounts. Although EOA has been widely adopted for its simplicity and the power of self-custody given to anyone, it has also greatly hindered the on-chain user experience. The most common drawbacks of EOA are that anyone who gains access to the mnemonic can access the wallet (a threat that exists for those who store their mnemonics on cloud services such as iCloud), and anyone who loses access to the mnemonic or forgets it can no longer access their on-chain assets. The key to improving this on-chain user experience lies in the emergence of abstract primitives, which are many products and services built around abstracting away as much friction as possible in the on-chain user experience. These can be toolkits and frameworks for developers to implement in their own networks or applications, or products and services that are directly user-facing. As Vitalik said, as development in this area continues to heat up and more teams are launching their own abstract primitives, the time to achieve a seamless on-chain user experience may be faster than most people think. But what exactly led to this breakthrough? Account abstraction refers to separating the management of on-chain accounts from the end user. This concept was proposed as early as 2017, but did not gain traction until ERC-4337 was proposed in 2021. Efforts around account abstraction initially led to the development of smart contract wallets, commonly known as smart accounts.In this model, on-chain accounts are managed by smart contracts, so they can be more programmable and optimized according to user needs. This brings new possibilities, such as being able to register an account using familiar social logins, paying gas fees with the same assets on different chains, and executing multiple cross-chain transactions with one click. The key to achieving account abstraction is the development of execution abstraction services, which outsources the execution of on-chain transactions to professional service providers called solvers (also known as fillers or executors) to obtain the best solution and execute transactions on behalf of the signer. Here, the user's signature on off-chain information is called an "intention", which contains instructions to perform on-chain operations (i.e., transaction execution requests). By separating transaction execution from signatures, users can more easily express their needs, and back-end solutions such as private mempools or competitive solver networks help provide users with the best settlement and value. In addition, another key element to achieving the ultimate on-chain user experience is the ability to communicate and interact across different blockchain environments. Users have always relied on cross-chain bridges to meet this need, but over time, it has been proven that cross-chain bridges have great risks and low security. Chain abstraction facilitates development around account and execution abstractions while introducing new infrastructure at the network layer, removing the complexity of communicating and interacting across different blockchain environments. For a comprehensive overview of the concept’s rationale and the broader chain abstraction ecosystem, see Shoal’s Chain Abstraction Deep Dive. Chain abstraction is the culmination of efforts around a common goal, which is to provide a seamless user experience that allows users to perform on-chain operations without having to know which chain they are using at a particular time. The following article will use Particle Network as an example to explore how the new chain abstraction stack can facilitate the on-chain user experience.
Particle Network Case Study
Background of the Agreement
Particle, originally launched as a wallet abstraction service provider by co-founders Pengyu Wang and Tao Pan in 2022, launched a stack for developers to create non-custodial, DApp-embedded wallets that can log in with social accounts through MPC-TSS technology. With the advent of ERC-4337 account abstraction, the protocol incorporated the AA protocol stack into the existing WA protocol stack, enhancing the account structure with smart contract wallets. This also laid the foundation for the later launch of BTC Connect, which brought AA services to the Bitcoin ecosystem through local Bitcoin signatures. Currently, Particle is launching its L1 as part of its comprehensive, multi-chain abstraction stack. Particle Network has a development team spread across the world, with more than 30 full-time employees, and has established partnerships with companies such as Berachain, Avalanche, Arbitrum, zkSync, etc. The protocol has raised $25 million in several rounds of seed rounds led by Spartan Group and Gumi Crypto, and recently received investment from Binance Labs.
Protocol Overview
Users connect to their UA by logging in through their existing wallet or social account.
The user submits a transaction request to Particle L1, expressed as an ERC-4337 UserOp to buy Dogcoin on chain X.
The bundled nodes in the Particle decentralized node network will handle the relevant UserOp and execute accordingly.
Particle’s relay nodes then monitor and synchronize the execution status on the relevant chains. Once the transaction is confirmed to be executed, the status is transmitted back from the chain to the relay nodes, which then transmit the status back to the user agreement and end users.
This way, users already have the tokens they want to purchase in their UA balance without having to interact with the chain the token is on.
Of course, there are more internal components in this process that deserve further investigation. If UA is considered as Particle's user-facing product, then universal liquidity and universal gas functions are key to achieving a seamless experience. Universal Liquidity Universal Liquidity (UL) refers to the layer in the Particle Network responsible for automatically executing transactions submitted through UA. This layer is supported by Particle's distributed network of Bundler nodes, which provide specialized services designed to perform user operations (UserOp) such as trading or extracting liquidity from the pool. In addition, a distributed network of relayer nodes, the decentralized messaging network (DMN), is responsible for monitoring the transaction status on the target chain and transmitting its settlement status back to Particle L1. The main purpose of UL is to enable users to interact with different chains through cross-chain transactions without having to buy and hold any tokens on the relevant chains. To better understand, consider the following process: a user wants to buy 100 USDC of Dogcoin on chain D, while holding 25 USDC each on chains A, B, C, and D.
First, the user signs a UserOp to buy 100 USDC Dogcoin on chain D, bundling their balances on four chains (chains A, B, C, D) into a single signature processed by Particle L1.
After the signature is executed, the USDC held by the user on chains A, B, and C will be sent to the liquidity providers (LPs).
LP releases all USDC on chain D.
USDC on chain D is exchanged for Dogcoin through the local DEX.
Finally, the Dogcoin balance will appear in the user's UA.
Protocol architecture and design
Modular Nodes
The use of modular nodes allows anyone to participate in running nodes dedicated to facilitating key L1 operations. These nodes can be classified according to their respective functions, such as bundled nodes are responsible for executing cross-chain user operations; relay nodes are responsible for monitoring transaction status (such as executed, failed) and transmitting it back to Particle L1 for settlement; watchtower nodes are responsible for monitoring the status of nodes and their respective tasks in the bundled node and relay node networks, and providing execution and fraud proofs for each block and each epoch.
Aggregate Data Availability Model
Double Staking
Login flow using the common SDK
Particle Network Status
According to the team, before the development of Particle L1, Particle had more than 17 million wallet activations, more than 10 million UserOps, and more than 900 decentralized applications. On May 2, 2024, Particle Network's incentivized L1 testnet was launched, providing point rewards through the Particle Pioneer platform. This public testnet allows users to test the functionality of its general account and general Gas, earning points for the upcoming PARTI token. Particle Testnet V2 explorer data shows that the network has generated 1.3 million blocks, with a total transaction volume of more than 7.3 million times and an average daily transaction volume of more than 400,000 times. In addition, according to the Particle Pioneer activity website, the testnet has more than 182 million transactions, and currently has more than 1.49 million users, earning a total of 27.3 billion points, with an average of 18,300 points per user. Particle L1 is currently scheduled to launch on mainnet in the second half of 2024.
Competition landscape of the chain abstract track
Chain abstraction is expected to become the next major framework for building interoperability platforms. Currently, there are multiple projects in this field that aim to become the standard toolkit or stack for building chain abstraction services.
Near Network
Polygon AggLayer
Other noteworthy projects
Everclear (formerly Connext) is developing a new chain abstraction stack. As the name implies, Everclear will launch the "first clearing layer" to provide global settlement for cross-chain transactions. Everclear will operate as an Arbitrum Orbit L2, powered by the Gelato RaaS, and will use Hyperlane and Eigenlayer to connect with other chains. The protocol ultimately aims to act as a shared computer that coordinates cross-chain transactions, settled in the form of invoices and cleared through Dutch auctions. Everclear revolves around the use of its Clearing Layers, with the goal of reducing costs for market participants. Clearing Layers are programmable and can be plugged into any settlement rail, for any transaction, and can provide permissionless liquidity for new chains and assets from day one. Socket 2.0 marks the Socket Protocol's shift from cross-chain services to chain abstraction services, and its flagship product, the Modular Order Flow Auction (MOFA) mechanism, is a prominent manifestation of this shift, which aims to provide competition for efficient chain abstraction markets. Traditional order flow auctions involve a network of various participants performing specialized tasks who compete to provide the best outcome for end-user requests. Similarly, MOFA aims to provide an open marketplace for execution agents, called Transmitters, and user intent. In MOFA, Transmitters compete to create and complete chain abstract bundles, or order sequencing of user requests that require the transfer of data and value between multiple blockchains.
Future Outlook
The opportunities in the chain abstraction track are exciting. However, as more teams begin to launch their own solutions, VCs begin to invest more funds in any project that mentions "chain abstraction", and users begin to struggle with which solution to choose, there are some important factors worth considering.
The Case for Abstract Primitives
Important factors to consider in particle networks
A key question for Particle’s distributed node network is how decentralized the network is. Will only a few entities participate in operating nodes, or will Particle be able to gain enough traction to maintain a sufficiently decentralized node network? How can Particle successfully incentivize enough node operators to achieve sufficient decentralization? To this end, we make two suggestions: 1) Try to lower the entry and participation barriers for node operators 2) Provide a public dashboard through the Particle browser to monitor and observe the decentralization of the node network Particle is building a settlement and coordination layer for atomic cross-chain transactions, which also raises the question of value accumulation. What economic impact will the successful adoption of universal accounts and Particle L1 have on other blockchains and ecosystems? Can they benefit from more user access? Changing the user experience state of blockchain native applications is not a new need, and developers have been working on solving this problem for a long time. Chain abstraction can create a more user-friendly on-chain experience for end users, unlock new user bases for applications, and provide lower-cost and more efficient cross-chain communication and routing for L1/L2/L3. Vitalik said that builders in the industry have "a lot of energy and willingness" to achieve a seamless on-chain user experience. Improving the user experience alone will not bring millions of users to the industry, but it is still one of the most important steps to achieve this goal.
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