Chain abstraction is a proposal to simplify interactions between different blockchains, while addressing issues related to their fragmentation such as liquidity and user experience. This mechanism makes it easier for developers to build cross-chain applications, while also facilitating easier access for users.
Currently, the cryptocurrency space has more than 1,000 different blockchains. However, widespread adoption remains challenging, especially due to the complexity of interacting with the vast array of existing blockchains. Each blockchain, with its own protocols and characteristics, acts as a separate platform, hindering seamless communication and interaction.
For developers, navigating such a fragmented ecosystem requires a significant amount of knowledge. Meanwhile, users are faced with complex processes and limited access, resulting in the concept of Web3 remaining unfamiliar to the general public.
To date, the biggest challenge of Web3 remains; if users want a truly multi-chain experience without the hassle of cryptocurrency, centralized exchanges are currently the only option. This goes against the real goal of public blockchains and decentralized exchanges.
A possible solution to this problem is chain abstraction – a concept similar to account abstraction, but focused on solving the problem of fragmentation in the current blockchain ecosystem.
The Problem: Fragmentation is Everywhere
Web3, by its very nature, is built on top of distributed ledger technology—a decentralized and immutable system that records transactions across a network of computers. This decentralization allows users to operate without the need for intermediaries, thereby enhancing trust and transparency.
However, the current blockchain landscape is heterogeneous; it consists of many separate blockchains, each with its own set of rules, protocols, and consensus mechanisms. While this diversity fosters innovation, it also creates a fragmented ecosystem, which poses significant challenges for both developers and users.
The fragmentation problem in blockchain is similar to a country with multiple languages, each of which is only used in a specific region. Although each language is rich and expressive, communication and collaboration between regions becomes difficult and inefficient.
In Web3, the lack of seamless interoperability between blockchains creates barriers to the free flow of assets and data. Developers struggle with these complexities, while users face a fragmented and difficult experience when conducting cross-chain transactions across different dApps and chains.
This is where chain abstraction comes in, providing an abstraction layer across multiple blockchains, creating a unified interface for interacting with them.
In a presentation, NEAR Protocol co-founder Illia Polosukhin highlighted four persistent challenges in Web3 that chain abstraction can address:
Challenge one: Single-chain applications limit market reach.
Challenge two: Fragmented liquidity, poor user experience (UX), and difficulty in app discovery.
Challenge three: Managing dozens of wallets and accounts leads to unsustainability.
Challenge four: End users expect economic opportunity and a fun app experience.
Chain abstraction acts as a bridge, translating user interactions and application requests into protocols and languages that the underlying blockchains can understand. This abstraction layer hides the complexity of each blockchain, providing a simpler and more streamlined experience for developers and users.
- Single-chain applications limit the market reach
Single-chain applications are designed to be tied to the protocol and infrastructure of a specific blockchain, leading to the creation of silos. Each dApp can only operate within its own ecosystem, which prevents access to users, liquidity, and services on other blockchains.
Developers are forced to build multiple versions of the dApp for each different blockchain or choose to focus on a single network, thereby limiting the application’s potential scalability and reach.
For users, this means they are locked into the ecosystem of one blockchain. If a user’s assets or interests span multiple blockchains, they will have to manage separate accounts, wallets, and interfaces for each network. This can frustrate users and discourage them from participating in Web3.
- Fragmented Liquidity, UX, DevEx, and Application Discovery
Liquidity pools, essential for decentralized finance (DeFi) and trading, are often fragmented across individual blockchains. This fragmentation reduces overall efficiency, as liquidity providers must choose between allocating capital across multiple chains or focusing on a single blockchain.
Furthermore, the developer (DevEx) experience is also affected by the heterogeneity of tools, APIs, and SDKs across blockchains, leading to increased development time and maintenance costs.
Fragmented liquidity means a degraded trading experience, increased costs, and lower capital efficiency. Inconsistent UX requires users to own multiple wallets, each dedicated to a specific blockchain.
Discoverability becomes more difficult as users are faced with a fragmented experience across multiple ecosystems, making it more complicated to find and interact with dApps on different blockchains.
- Managing dozens of wallets and accounts is unsustainable
Multi-chain interactions require users to manage multiple wallets, each tied to a specific blockchain and with its own private keys, seed phrases, and rules of operation. The increase in the number of blockchains that users interact with leads to a complex and error-prone experience.
The amount of information to manage becomes overwhelming as users have to switch between wallets, manage multiple seed phrases, and remember assets on each blockchain. This increases the risk of errors and often causes users to abandon Web3 altogether.
The need to keep track of multiple accounts and wallets creates an unsustainable experience, making it difficult for the average user to interact regularly with the ecosystem.
- End users only want economic opportunities and interesting applications
The current fragmentation forces developers to choose between focusing on one blockchain or spreading their efforts across multiple blockchains. This limits innovation, as developers must compromise between building for a broader audience or integrating deeply into a single chain.
As a result, many potential economic opportunities, such as cross-blockchain yield farming, trading, or game development, remain unrealized or become too complex.
The main appeal of Web3 is the ability to access innovative financial tools, games, and social applications. However, the current fragmented landscape makes it difficult for users to seamlessly explore new opportunities across multiple blockchains.
Most users don’t care about the complex technical aspects; they only care about the utility and fun of the dApp. The current multi-chain environment becomes a huge barrier, making it confusing and difficult to access the applications and services they care about.
Solution: Chain Abstraction
Chain abstraction is a concept that aims to create a unified and seamless experience across multiple blockchains, freeing users and developers from the complexity of each individual blockchain.
Currently, the blockchain interoperability layer is often fragmented, requiring users to manage multiple wallets, switch between networks, and navigate different types of gas tokens depending on the blockchain they are using.
The goal of chain abstraction is to solve these problems by simplifying interactions, reducing the complexity associated with blockchains through a user-friendly interface.
In an abstracted environment, users do not need to worry about the blockchain they are interacting with, the type of gas tokens required, or how to connect assets between networks. Instead, their focus shifts entirely to the experience – whether it is a game, DeFi, or social application – without having to manage the complex details of the blockchain.
In essence, chain abstraction aims to remove barriers between different blockchain ecosystems through a unified interface, allowing them to interact and be easily accessed. In this model, a single wallet, application, or platform can connect to multiple blockchains without requiring users to switch networks or manage complex configurations.
How Chain Abstraction Works
Chain abstraction is a complex mechanism that combines smart contracts, messaging protocols, and middleware, allowing seamless interaction with multiple blockchains through a unified interface.
- Abstraction Layer: The Heart of the System
The abstraction layer is where the “magic” happens. This can be a separate blockchain or a “layered” solution that sits on top of the blockchains it connects to. This layer contains smart contracts, which act as intermediaries between users’ dApps and the underlying blockchains.
These smart contracts are sophisticatedly designed to understand and process the protocols and transaction formats of each connected blockchain. They act as translators, converting user requests into a language that the target blockchain can understand.
- Messaging Protocols: The Communication Backbone
For the abstract layer to interact with the underlying blockchains, a robust communication channel is needed, and this is where messaging protocols come into play.
These protocols enable secure and reliable message transmission between the abstract layer and different blockchains. Some popular messaging protocols include: IBC (Inter-Blockchain Communication Protocol), a multi-chain interoperability protocol that enables cross-chain messaging and asset transfers. Protocols that connect different blockchains.
These protocols ensure that transactions initiated on the abstract layer are correctly relayed and executed on the target blockchain, and the results are communicated back.
- Middleware: Bridging the Gap
Middleware plays an essential role in abstracting the chain by providing additional functions and services that enhance the overall system. Key components include: Off-chain services that monitor the abstract layer, look for new transactions, and forward them to the appropriate blockchain. Validators to ensure transaction authenticity, maintain security, and integrity for the system. Providing real-world data to smart contracts, allowing them to interact with external information called Oracles.
Middleware components work in concert with the abstract layer and messaging protocol, creating a seamless and efficient cross-chain communication channel.
- General Process
A user initiates a token transfer request through a dApp built on the abstract layer. The smart contract on the abstract layer then receives the request and translates it into the format required by the target blockchain. The translated message is sent to the relay network, which then routes it to the appropriate blockchain. The destination blockchain receives the message and performs the token transfer. The relayer relays the transaction confirmation back to the abstraction layer. Finally, the abstraction layer updates the dApp’s user interface, notifying it of the successful token transfer.
Intent-Based Architecture of Chain Abstraction
Intent-based architectures allow users to express their desired outcome (intent) rather than having to specify the specific steps required to achieve that goal.
In a typical transaction, the process might be described in a “math” and rigid manner, such as: “Convert A to B with a minimum loss of C% on platform D.”
In contrast, an intent-based transaction is more user-oriented, such as: “Get B from A with the lowest possible loss.”
This approach simplifies complex transactions and improves user experience, especially in blockchain environments with multiple chains and diverse technical specifications.
The process of finding a way to fulfill a user’s intent is automatically handled by the system, with the help of a solver*. This solver can perform tasks such as selecting the most suitable blockchain, finding the best interest rate, and ensuring transaction security.
However, ensuring that solvers act in the best interests of users is a significant challenge. Furthermore, the mechanism of abstracting chains and intentions can increase the complexity of the blockchain ecosystem.
Popular methods of chain abstraction
Chain abstraction, similar to account abstraction, is a theoretical concept. Therefore, different projects and development teams will adopt separate approaches to realizing this idea.
Let’s take a look at how some popular protocols are exploring and implementing chain abstraction in the Web3 space: NEAR Protocol, Particle Network, ZetaChain, Agoric, XION, Socket, Aarc.
- NEAR Protocol
NEAR Protocol takes a unique approach to chain abstraction through the “chain signature” mechanism.
One of the core elements of chain abstraction is the use of multi-party computation (MPC) to manage private keys shared across different blockchains. In this model, no single node or entity holds complete control over the private keys; instead, signing and authorizing transactions requires the consensus of a majority (usually two-thirds) of participating nodes.
This approach leverages “chain signatures,” allowing a transaction initiated on one blockchain to be securely relayed and executed on another blockchain.
To illustrate, consider two hypothetical chains, Chain A and Chain B.
1.1. Cross-contract call mechanism
NEAR allows smart contracts on Chain A to execute transaction commands or processing requests from smart contracts on Chain B. This is called a cross-contract call mechanism.
1.2. Chain signature
When executing a cross-contract call, Chain A will generate a special cryptographic signature called a “chain signature”. This signature proves that a particular action or transaction was initiated and authenticated on Chain A.
1.3. On-chain authentication
The chain signature along with other necessary data will then be sent to Chain B.
Chain B has a built-in mechanism to verify the authenticity of the chain signature, ensuring that the “call” comes from a legitimate source on Chain A and has not been tampered with by a third party.
Once the verification is complete, Chain B can execute the corresponding actions in its smart contract as directed by the “call” from Chain A.
- Particle Network
Particle Network provides a solution to abstracting the chain by providing a seamless user experience through a single account, automatically connecting assets, and simplifying the gas fee payment process.
Their flagship product, the “Universal Account”, acts as a smart contract wallet across multiple blockchains. This allows users to own a single address and manage a unified balance across multiple ecosystems, including EVM, Bitcoin, and Solana chains.
Users can easily use their assets across all connected chains without having to perform complicated manual operations. The protocol also eliminates the hassle of gas fees, allowing users to pay with any token of their choice.
Particle Network is built on the Cosmos SDK and has a high-performance EVM-compatible execution environment. This makes it easy for developers to build dApps that can easily interact with multiple blockchains.
- ZetaChain
ZetaChain aims to connect and facilitate different blockchains to “communicate” seamlessly, despite differences in their operating mechanisms. This concept is called “omnichain interoperability”.
ZetaChain operates as a standalone Layer 1 blockchain, serving as a common platform for different blockchains to connect with each other. It has its own consensus mechanism and a native token (ZETA) to secure and incentivize the network.
Prominent in ZetaChain’s ecosystem is the concept of Omnichain Smart Contracts (OSC), which can be deployed on its platform. OSCs are capable of directly interacting with assets and data on any connected blockchain, including blockchains that do not support native smart contracts, such as Bitcoin.
Chain Abstraction Framework (CAF) is the underlying infrastructure for omnichain connectivity, including: ZetaClient, Observer-Signer Node, ZetaChain provides a Universal EVM (Ethereum Virtual Machine) environment, allowing developers to write smart contracts in the familiar Solidity language and deploy them on ZetaChain. These contracts can leverage CAF to interact with any connected blockchain.
When a user or dApp initiates a cross-chain transaction via ZetaChain, the OSC on ZetaChain interacts with CAF, which handles communication and verification with the relevant blockchains.
Observer-Signer nodes play an essential role in ensuring the security and validity of cross-chain transactions. Once verified, the transaction is executed, allowing assets or data to flow seamlessly between different blockchains.
- Agoric
Agoric aims for an approach where users don’t need to directly interact with or even learn about the complexities of multiple blockchains. Their goal is to provide a seamless and intuitive experience for navigating the multi-chain ecosystem.
The Orchestration API is the core tool that Agoric provides to enable chain abstraction. This API allows developers to program and coordinate complex, multi-step transactions across different blockchains. It handles all the low-level details related to cross-chain communication, smart contract execution, and asset transfers.
Developers can use the Orchestration API to define cross-chain workflows for their applications, including asset transfers, smart contract execution on different chains, or any other multi-step operation.
Once the workflow is defined, the API automatically executes it seamlessly across the relevant blockchains. The functions that the API is responsible for include: Routing messages and transactions to the correct blockchain. Managing asset transfers and bridges. Ensuring the consistency of the entire operation, meaning that all steps must be successful or none of the steps are performed.
From the user’s perspective, they only need to interact with a single unified interface. The complexity of multi-chain operations is completely abstracted, providing a convenient and efficient experience.
- XION
XION applies a general abstraction layer to remove technical barriers for users, through the integration of many advanced features such as protocol-level abstract accounts, signature abstractions, and gas abstractions.
5.1. Account abstraction
This feature allows users to create Meta Accounts, smart contracts that act as user accounts. These accounts simplify the login process, provide enhanced account management, and facilitate interactions through familiar authentication methods like email or biometrics, rather than relying on traditional wallet systems.
5.2. Signature Abstraction
XION supports signatures across all current and future cryptographic curves. This allows users to sign transactions using a variety of methods, including email, biometrics (like FaceID), and blockchain-specific signature types (like EVM, Solana).
5.3. Gas Abstraction
XION removes the concept of gas fees from the user experience. Instead of requiring users to learn about and manage gas fees — a common barrier to using blockchain — XION abstracts this away, allowing users to make transactions without having to worry about managing gas fees.
5.4. Price Abstraction
XION introduces fiat pricing, which removes the volatility and complexity of cryptocurrency values. Users can interact with prices in familiar legal terms, increasing adoption and making economic interactions more intuitive.
5.5. Device Abstraction
XION allows users to securely interact with applications across multiple devices without directly managing private keys. This not only increases accessibility but also enhances user security.
- Socket
With the Modular Order Flow Auctions (MOFA) mechanism, Socket implements chain abstraction, allowing different layers in the Web3 stack to communicate and interact smoothly.
Socket gives developers the ability to collaborate with any application, user, or asset across multiple blockchains and roll-ups, while maintaining a unified and friendly user experience.
Socket’s architecture is designed to be modular and extensible. This allows developers to easily integrate new blockchains and functions into the protocol, flexibly adapting to any context. This flexibility ensures that Socket remains an essential tool in chain abstraction, even as new technologies emerge.
Another key component of Socket’s technical strength is the Magic Spend++ feature. This feature allows users to interact with applications across multiple blockchains with a single click and signature.
By combining the principle of account abstraction, such as smart contract wallets, with the ability to abstract chains, Socket provides users with an intuitive and seamless experience that “eliminates” the complexity of basic blockchain interactions.
- Aarc
Aarc SmartChain, the backbone of the Aarc network, stands out as a unique contender in the chain abstraction space. The system operates as a permissionless, modular orchestration platform built on Axelar technology, aiming to synchronize and process states across both Layer 1 and Layer 2 blockchains quickly and securely.
Aarc SmartChain applies a network of hierarchical sequences, which play a vital role in transaction validation. This method not only ensures security but also enables high-speed transaction processing, providing a seamless user experience.
The chain is designed as a general-purpose execution environment, with perfect compatibility with the EVM. This feature allows developers to easily migrate Ethereum-based dApps to Aarc SmartChain or build new dApps without having to be familiar with a new programming language or environment.
In addition, Aarc SmartChain also acts as a horizontal coordination layer, connecting users and decentralized applications on different networks. This bridge function enhances the interoperability between different blockchains and applications, contributing to the development of an increasingly interconnected Web3 ecosystem.
Conclusion
A few years ago, the abstract concept of chain was quite far from reality. However, with the tremendous strides in blockchain innovation and the race towards standardization, the idea of a unified interoperable blockchain ecosystem is becoming more feasible than ever.
The projects mentioned in this article are illustrative and not exhaustive. There are many more projects on the way to achieving incredible breakthroughs.
Chain abstraction has the potential to remove the barriers that separate blockchains, creating more seamless connections and contributing to the thriving development of a dynamic Web3 ecosystem.
*Relayer: a third party that acts as a bridge between blockchain platforms; these relayers will appear in cross-chain projects such as LayerZero or RelayChain.
*Solver: an agent or automated system that helps find the best way to fulfill user intentions.
