LayerZero (ZRO)

From their docs (2-2022):

"LayerZero is an Omnichain Interoperability Protocol designed for lightweight message passing across chains. LayerZero provides authentic and guaranteed message delivery with configurable trustlessness. The protocol is implemented as a set of gas-efficient, non-upgradable smart contracts."

Basics

• Based in:
• Started in / Announced on: 16-9-2021
• Testnet release:
• Mainnet release:
• From EthHub (21-9-2021):

"LayerZero bills itself as “an omnichain interoperability protocol” that aims to connect all chains in a seamless way."

Audits & Exploits

• Bug bounty program can be found [insert here].
• Audit was done by SlowMist (15-3-2022).

Technology

• Whitepaper can be found here.
• Code can be viewed [insert here].

Implementations

• From their announcement (15-3-2022):

"We’re live on Ethereum, Avalanche, Polygon, BNB Chain, Fantom, Arbitrum and Optimism. In 6–8 weeks consider Solana, Terra, Cosmos Hub and Osmosis slam dunks and LayerZero to be everywhere in 4–6 months."

• Programming language used:

Transaction Details

• Capacity (TPS):
• Latency:

How it works

• From Our Network (27-8-2022):

"LayerZero is a lightweight universal messaging interface that allows developers to seamlessly interact with contracts across dozens of blockchains. LayerZero Endpoints rely on an innovative Relayer and Oracle architecture to trustlessly relay messages between chains. This unique messaging structure and security model is the only solution available today that does not rely on wrapped assets, middle-chains, or vulnerable upgradeable contracts."

• From Alphapls (28-3-2022):

"LayerZero is not a blockchain, it is a protocol, largely operating off chain with ‘ultralight client end points’ which are smart contracts built on chains it is aiming to connect. Chains will include L2s, as well as L1s; and later non-EVM, as well as EVM. LayerZero Endpoint exists on each (supported) chain, and any chain with a LayerZero Endpoint can conduct cross-chain transactions involving any other chain with a LayerZero Endpoint. In essence, this creates a fully connected network where every node has a direct connection to every other node. With minor boilerplate code, any blockchain is supported.

LayerZero refer to their light onchain clients as ‘LayerZero Endpoints’. They are made up of smart contracts which have three main functions:

1. communicator
2. validator
3. network

For simplification, I’m going to refer to all of the above as ‘endpoint’ and run a simple example.

1. Cross-chain action committed on chain A (e.g. against a deposited asset in a lending protocol on ETH, borrow USDC from the same lending protocol on Polygon) and sent to the endpoint.
2. The endpoint sends information to the Relayer and Oracle - both separate entities and both off chain.
3. The Oracle confirms the block header (the Oracle on testnet was Chainlink).
4. The Relayer confirms the transaction on chain A (it’s function is similar to an Oracle but looking for a different bit of data).
5. Presuming everything is in order, the rest of the action stated on chain A is committed on chain B (USDC is received in wallet on Polygon).

If there is any contention between the Relayer or Oracle as to information being passed on, the smart contract is paused and not committed to chain B. To ensure valid delivery, the only requirement is that for any given message sent using the LayerZero protocol, the Oracle and Relayer must be independent of each other. The protocol itself does not require any specific implementation of a Relayer, and in theory the users of LayerZero could even implement their own Relayer service. This design allows users to be sure that the Relayer cannot collude with the Oracle, and this independence is what allows us to implement trustless validated delivery."

Their Other Projects

Stargate

• From their announcement (15-3-2022):

"Stargate, the first bridge to solve the Bridging Trilemma, launches on top of LayerZero (and all 7 chains) in two days. Learn about how to participate in liquidity generation event that starts in two days here."

Roadmap

• Can be found [Insert link here].

Usage

• From Our Network (27-8-2022):

"LayerZero users have sent over 300K messages across supported chains. Going deeper, BNB users are leading in terms of cross-chain messages sent. LayerZero recently surpassed 1000 connected contracts live on the LayerZero Mainnet."

Competition

• CCIP from Chainlink. From Alphapls (28-3-2022):

"CCIP will include all the functions [of] LayerZero, including a programmable token bridge to allow similar dApps to Stargate Finance to be built out.

The additional innovation with CCIP is the creation of ‘Hybrid Smart Contracts’ which will enable both on-chain and off-chain smart contracts to work together, in conjunction with cross-chain execution."

Team, Funding and Partners

Team

• Full team can be found [here].
• LayerZero is the child of Primo and Ryan Zarick with input from well known ex-Sushi developer (and Tokemak advisor) 0xMaki.
• 0xMaki; full time bizdev

Funding

• Raised $135 million at a $1 billion valuation in a round co-led by Andreessen Horowitz (a16z), the venture capital arm of crypto exchange giant FTX and Sequoia Capital, the company announced (31-3-2022). Other backers in the Series A extension round included Coinbase (COIN) Ventures, PayPal (PYPL) Ventures, Tiger Global and Uniswap Labs. LayerZero announced a $6 million Series A round co-led by Multicoin Capital and Binance Labs last September as the company came out of stealth.

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