The Future of OmniChain: ZetaChain, A Novel Layer-1 Blockchain Enables Fully Interoperable Smart Contracts
In this report, we will provide a detailed introduction to ZetaChain's cross-chain mechanism, and make a detailed comparison between existing cross-chain technologies and ZetaChain's Omnichain functionality to guide readers in-depth understanding ZetaChain. After reading this report, we hope readers can get answers to the following questions: What is ZetaChain? What are the key technical innovations of ZetaChain compared to other cross-chain projects? How is the current ecosystem development of ZetaChain?
Here are a few highlights from this report:
What is ZetaChain?
In layman's terms, ZetaChain is a public chain that allows people to send messages and transfer crypto assets between different blockchains like Bitcoin and Ethereum, without needing any middlemen or extra steps. This is achieved through the Omnichain capability, which connects all the different blockchains together, so people can easily move assets and messages. ZetaChain also allows developers to build decentralized apps that work across all chains, making it easy to manage everything from one place.
Existing Cross-Chain Technology
- Cross-chain bridges generally use two types of solutions for funds transfer: [Lock/Burn + Mint] and [Liquidity Swap]
- There are two primary cross-chain communication technologies used by cross-chain bridges: [Single/Multi-Party Verification] and [Relayer + Light Client]
From the comparison, it can be seen that most early cross-chain bridge protocols, such as WBTC, use the [Lock/Burn + Mint] approach for cross-chain asset transfer, while newer cross-chain protocols, such as Stargate and Synapse, mostly choose the [Liquidity Swap] approach.
According to statistics, as of March 16, 2023, 8 of the 10 cross-chain protocols with the highest TVL on DefiLlama use the [Lock/Burn + Mint] solution. Only two protocols, Stargate and Synapse, have chosen the [Liquidity Swap] option.
Limitations of Cross-Chain Bridges
- The [Lock/Burn + Mint] method requires wrapped assets to implement cross-chain transfers.
- The [Liquidity Swap] solution does not support non-smart contract platforms and non-available assets within the target network.
- In the [Single/Multi-Party], Single-Party Verification is centralized.
- In [Relayer + Light Client], the deployment cost of third-party relayers is relatively costly.
Innovations of ZetaChain
- In order to address the drawbacks of the existing cross-chain protocols and to achieve its Omnichain functionality, ZetaChain has developed a series of tools for cross-chain fund exchange and general multichain orchestration: Omnichain Smart Contracts, Accounts, and Messaging.
- For cross-chain transaction verification, ZetaChain plans to use a combination of the [Relayer] and [Multi-Party Verification] schemes. It will employ its inner distributed validator network and Threshold Signature Scheme (TSS) to verify and sign transactions.
How Does ZetaChain Implement Omnichain Functionality?
ZetaChain Distributed Hyper-Connected Validator Network
The cross-chain messaging function of ZetaChain is mainly achieved through its inner distributed validator network. It plans to use this validator network to replace outside relays and oracles, helping to verify cross-chain transaction states and implement price-feeding functions.
ZetaChain Omnichain Accounts/TSS
ZetaChain's Omnichain accounts allow users to connect all blockchains including both smart contract platforms and non-smart contract platforms to implement Omnichain fund transfers. It acts as a "base station" for all transactions and will be used to manage and verify transactions associated with external chains. The transaction verification is supported by the aforementioned Threshold Signature Scheme, TSS.
ZetaChain Omnichain Smart Contracts and Messaging
With Omnichain Smart Contracts, developers can build a diverse range of Omnichain DApps. Developers are only required to deploy a single smart contract on ZetaChain via zEVM to connect all target chains, including ZetaChain itself. Contracts on zEVM are connected to ZetaChain’s interoperability layer and are able to orchestrate assets on external chains, thus enabling seamless cross-chain asset transfers.
ZetaChain is operating its official accounts on multiple social media platforms, including Twitter, Telegram, and Discord, and supporting in over 20 languages. The total number of its community members is over 1 million.
The On-Chain Ecosystem
Targeted the on-chain data, ZetaChain released a blockchain explorer, Zetascan. Through Zetascan, users can observe the overall operation status of the Athens-2 testnet, with various data dimensions including cross-chain transactions, ZetaChain transactions, DApp contracts, etc.
ZetaChain has built partnerships with several major projects/protocols across different domains. It hopes to help these projects/protocols add more cross-chain use cases and implement all-chain asset transfers, through its unique Omnichain technology. According to ZetaChain, the Omnichain DApps that have been confirmed to be deployed on ZetaChain include DEX, Identity infrastructure, social protocols, DAO, etc. Detailed information about some of the projects is listed below.
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Reported by TokenInsight with participation from ZetaChain in the research, who had no control or influence over its content and conclusions