Immutable X (IMX)

An NFT exchange and L2 sollution. Immutable X is a ZK rollup engine for minting and exchanging NFTs on Ethereum. It promises zero gas fees, instant trades and scalability for games, applications, marketplaces, without compromise.

Basics

• Based in: Sydney (9-3-2022).
• Started in / Announced on: 21-10-2020
• Mainnet: "We are aiming to release our first public version in Q1 2021." (on the website as of 30-3-2021). Update: launched on 8-4-2021.
• From EthHub #113 (12-5-2020):

"Immutable X is a decentralized, non-custodial exchange that scales trading on the Ethereum network with instant settlement and zero gas fees."

History

• Built (8-5-2020) by Gods Unchained and StarkWare.

Audits & Exploits

• Bug bounty program can be found [insert here].
• From L2beat (13-10-2022):

"Funds can be stolen if…

1. a contract receives a malicious code upgrade. There is a 14 days delay on code upgrades.

Funds can be lost if…

1. the external data becomes unavailable (CRITICAL),
2. the proof system is implemented incorrectly.

Users can be censored if…

1. the committee restricts their access to the external data,
2. the operator refuses to include their transactions. They can still exit the system.

MEV can be extracted if…

1. the operator exploits their centralized position and frontruns user transactions."

Governance

• From their announcement (8-5-2020)

"Immutable X is still a fair way off but, once it’s live, assets will be minted directly onto the platform. Existing users will also be able to move their Gods Unchained items onto the platform without handing control of those assets over to us. Overall, when Immutable X launches we’ll still have zero control over its users items and won’t be able to touch or alter those items in any way. Immutable X merely acts as a facilitator to make more efficient trades. To reiterate what was said above (as it’s vital): Immutable X will be non-custodial; users will be able to trade their assets without trusting the security of Immutable’s infrastructure."

Admin Keys

• From L2beat (13-10-2022):

"The system has a centralized operator. The operator is the only entity that can propose blocks. A live and trustworthy operator is vital to the health of the system. Typically, the Operator is the hot wallet of the StarkEx service submitting state updates for which proofs have been already submitted and verified. Force exit allows the users to escape censorship by withdrawing their funds. The system allows users to force the withdrawal of funds by submitting a request directly to the contract on-chain. The request must be served within a defined time period. If this does not happen, the system will halt regular operation and permit trustless withdrawal of funds. If enough time passes and the forced exit is still ignored the user can put the system into a frozen state, disallowing further state updates. In that case everybody can withdraw by submitting a merkle proof of their funds with their L1 transaction.

The system uses the following set of permissioned addresses:

1. Governor 0x799E…4B5a (EOA) Can upgrade implementation of the system, potentially gaining access to all funds stored in the bridge. Currently there is no delay before the upgrade, so the users will not have time to migrate.
2. Data Availability Committee0x1ffb…58d1 (EOA), 0x24ee…d54b (EOA), 0x48af…b949 (EOA), 0x51ab…ff2e (EOA), 0xafc4…5d17 (EOA), 0xb71f…ff61 (EOA), 0xff50…c537 (EOA) Validity proof must be signed by at least 5 of these addresses to approve state update.
3. SHARP Verifier Governor 0x3DE5…F5C6 (EOA) Can upgrade implementation of SHARP Verifier, potentially with code approving fraudulent state. Currently there is no delay before the upgrade, so the users will not have time to migrate.
4. Operator 0x9B7f…927e (EOA) Allowed to update the state. When the Operator is down the state cannot be updated."

Token

Launch

• Announced its IMX token on 22-7-2021. The public sale will happen on the 8th of September 2021 via CoinList.

Utility

• Governance and utility token, also used for staking.
• From Bankless (22-7-2022):

"Immutable X is governed by the IMX token. Along with these rights, IMX holders can stake their tokens to earn 20% of transaction fees, as well as protocol fees that include 2% of all secondary NFT trades made on the L2."

Other Details

• Supports ERC-20 and ERC-721 (30-3-2021). Has no native token;

"Unlike sidechains, we're not controlled by central operators that can be easily attacked (51%) and ransomed, nor do we require a novel token to use."

Technology

• Whitepaper or docs can be found here.
• Code can be viewed here.

Implementations

• Built on: Ethereum, built using StarkEx
• Consensus mechanism:
• Algorithm:
• Virtual Machine:
• Development language:

Transaction Details

• Capacity (TPS): "capable of handling 200m+ NFT transactions per day" (8-5-2020). "Massive scalability up to 9,000+ TPS." (30-3-2021).
• Latency:

How it works

• From L2beat (13-10-2022):

"Each update to the system state must be accompanied by a ZK Proof that ensures that the new state was derived by correctly applying a series of valid user transactions to the previous state. Once the proof is processed on the Ethereum blockchain the L2 block is instantly finalized. The system state is represented using Merkle roots. The balances of the users are not published on-chain, but rather sent to several well known and trusted parties, also known as committee members. A state update is valid and accepted on-chain only if at least a quorum of the committee members sign a state update."

• As they themselves claim: "Not a centralized sidechain."
• From Bankless (22-7-2022):

"Immutable X is considered to be a validum because transaction data is stored via an off-chain solution known as a data availability committee rather than entirely on-chain. While this means that Immutable X has increased trust assumptions relative to other rollups that settle to Ethereum, it allows the network to significantly reduce transaction costs, with the network entirely subsidizing them for end users."

• From their website (30-3-2021):

"Under Immutable X Volition model, users will be able to choose whether particular assets are held as a Validium ZK-proof or ZK-Rollup."

Fees

• ImmutableX is turning 2% fees on to be sustainable. From their blog (30-5-2022):

"This week, we are activating Immutable X’s “protocol fee” in preparation for the upcoming release of $IMX staking in June. The protocol fee isn’t a gas fee, nor do you need to pay it in $IMX directly — it’s a simple exchange fee on transactions, paid in the currency of the trade. Part of this fee is allocated to Immutable, and part to the $IMX staking rewards pool. Immutable takes a 2% “protocol fee” on all secondary trades, with no flat fee on each trade."

• From Bankless (23-7-2021):

"Once live, a 20% cut of all Immutable X transaction fees will be denominated in $IMX; these fees will go to a staking rewards pool as yield for $IMX stakers."

Their Other Projects

• Immutable zkEVM got announced (21-3-2023), using Polygon zkEVM, gas to be paid in $IMX.

Roadmap

• Can be found [Insert link here].

Usage

Projects that use or built on it

• Gods Unchained
• Illuvium
• OpenSea (1-4-2021)

Competition

• Other Layer 2s like Optimism, Polygon, xDai, etc.

Team, Funding, Partners

Team

• Full team can be found [here].
• After the 2022 market crash it announced it would lay off 6% of the company (27-7-2022). This happened not too long after its announced a $500M dev fund for Web3 game adoption (17-6-2022) and its 8-3-2022 $2.5B valuation (see below). "The CEO and co-founder of Immutable, James Ferguson, told employees the company is still in “a fantastic position,” according to reporting from CNET. Immutable has grown to 280 employees from 180 at the start of this year, according to the spokesperson. And they said the Australia-based company is “on track” to grow its headcount to 360 employees in the next five months."

Funding

• Turned out (8-12-2022) to have sold $210k worth of tokens to Alameda.
• Launched a $500 million development fund to build out blockchain-based games and projects (17-6-2022).
• From Bitcoin.com (9-3-2022):

"Raised $200 million in a Series C financing round led by Temasek. The company is now valued at $2.5 billion and Immutable plans to use the funds to scale the startup’s gaming studio."

• Raised $60m in a Series B round (14-9-2021).

Partners

• Immutable X partnered with OKX (5-4-2022).
• Managed to secure partnerships with prominent meatspace firms such as Disney, Gamestop and Turner Sports (22-7-2022).

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