As we have discussed at the Solana Breakpoint conference, The Composable Foundation is incredibly proud to announce that we are nearing the launch of something that many thought was technically impossible: connecting Solana to the Inter-Blockchain Communication (IBC) Protocol.
- Solana IBC is coming soon.
- Solana IBC will be powered by Picasso and will join Polkadot, Kusama, Cosmos, and soon Ethereum in the cross-ecosystem IBC hub.
- We have identified several interesting use-cases for when the connection is live. We are looking for early collaborators and teams that want to begin exploring novel possibilities.
- As Solana cross-pollinates with Polkadot, Cosmos, Kusama, and Ethereum the value from IBC transfer activity will accrue to $PICA token holders.
Adding Solana to Picasso’s Growing List of IBC Connections
Because of the requirements of the IBC protocol, Solana and a number of other chains like TRON and NEAR were previously incompatible with IBC. Composable has worked with collaborators at the University of Lisbon to develop a mechanism for making Solana and other IBC-incompatible chains capable of connecting to IBC for the first time. We are initially deploying this mechanism for Solana, with plans for expansion to other networks in the future.
Soon, the massive usership and liquidity of Solana can flow into other chains connected to the IBC protocol over Picasso via trustless (IBC) (and vice versa). Moreover, this connection will allow for the development of new cross-chain use cases between Solana and other ecosystems, and enable users to more seamlessly navigate the cross-chain DeFi space.
With this connection, we take one step closer to our vision of any chain, anywhere.
Benefits and Use Cases
With the Solana <> IBC connection, users and developers will be able to implement any kind of cross-chain use case imaginable between Solana and the other IBC-enabled chains, including Cosmos/the Interchain, Polkadot, Kusama, and Ethereum. Thus, the speed, cost-effectiveness, and massive liquidity and usership of Solana can be leveraged from other ecosystems as well.
Perhaps even most excitingly, this innovation paves the way for other previously IBC-incompatible chains to be linked to trustless (IBC) on Picasso, potentiating an even more widely interconnected DeFi space with greater opportunities for all participants.
Solana <> IBC Details
The Solana guest blockchain is a system developed by Composable and our collaborators on the research team at INESC-ID Distributed Systems Group, associated with the University of Lisbon. We are particularly grateful for the contributions of Professor Miguel Matos to this collaboration.
This novel guest blockchain design enables Inter-Blockchain Communication (IBC) Protocol communication between Solana and other IBC-supported ledgers (such as ones based on the Cosmos SDK). To operate, the system requires participation of validators who take part in guest block generation. The overall flow of the guest blockchain is depicted below:
This figure depicts the sequence of events when successfully sending a message from a blockchain using our guest blockchain solution and an IBC-enabled counterparty blockchain. Like in any trustless example, anyone can run a relayer to pass messages between the host blockchain and the counterparty blockchain. However, to be able to provide a proof to the counterparty blockchain, a guest blockchain with provable storage is necessary..
Some blockchains (for example NEAR, Solana and TRON) do not meet IBC’s technical criteria (e.g. see ICS-23 specification), preventing their integration with the wider IBC network. In response, we created a novel guest blockchain solution which runs on top of otherwise unsupported ledgers, providing all features necessary for IBC integration. We deploy the guest blockchain solution on the Solana chain where our approach introduces provable storage and enables IBC-based communication with Solana. This allows for trustless bridging to chains that otherwise cannot support the IBC.
If one wants to become a validator for the guest blockchain, they need to stake assets with the guest contract which maintains the chain. Once they do so, they are added to the set of candidate validators.
On each epoch change, the contract looks at the candidates with the most stake and picks them as the validators set of the next epoch. If a validator wishes to stop validating, they again send that information to the guest contract which removes them from the set of possible validators. However, the validator must continue validating blocks until the validator set change occurs; validators must commit to validate blocks for at least one epoch. Otherwise, staked tokens are not released, making this an incentive to follow the protocol.
Furthermore, once a validator is removed from an active set, they need to wait before their staked tokens are released to them. This allows other parties who may have detected malicious behavior (i.e. a slashable offense) performed by the validator to submit their proofs. Once misbehavior is successfully reported, a validator is slashed (i.e. their stake and unpaid rewards are taken away) and they are removed from the validators set for the next block (if they are still a validator in current epoch).
To avoid validators performing fraudulent actions and immediately resigning with all their stake and rewards intact, the guest blockchain holds the validator’s stake and reward for a period deemed sufficient for other actors to have time to find and report any potential slashable behavior.
A lot of effort (business development, technical, etc.) for this connection is required before we can launch. Therefore, our goal is to have the Solana <> IBC connection launched by end-of-year 2023. For example, it is particularly critical for us to obtain validator feedback, onboard validators, and to explore restaked validation, as we must ensure that validation for our connection is properly bootstrapped before full launch.
Stay Tuned for Launch and New Use Cases….
We can’t wait to provide you with more updates on the launch sequence of our Solana <> IBC connection via trustless.zone on Picasso.
In the meantime, check out some exciting protocols in Solana that will soon become accessible over IBC:
- Marinade Finance: This stake automation platform monitors all validators on Solana to delegate users’ SOL tokens to those that are performing the best. Marinade boasts an impressive TVL of over $315 million (making it the largest Solana protocol in terms of TVL by a significant margin), and provides users the mSOL liquid staking token (LST).
- Jito: Another liquid staking protocol, Jito, provides users with MEV rewards through liquid staking. For example, Jito’s jitoSOL liquid staking token has an APY of nearly 7%. Jito also has a strong growth rate, with a 202% increase in TVL over the last month.
- Solend: This is a lending and borrowing protocol that describes itself as “…the autonomous interest rate machine for lending on Solana”. 60 assets are available for lending/borrowing across 20 pools, with $88.8 million in total assets supplied.
- Marginfi: Marginfi is another lending and borrowing protocol. It prioritizes user risk management while accessing leverage and maximizing capital efficiency. It has 23 pools for various tokens, including LSTs like jitoSOL and mSOL. Its TVL is over $50 million.
- Orca: This protocol describes itself as “Solana’s most user-friendly concentrated liquidity AMM”. It is the largest DEX on Solana in TVL (over $50 million). Every Orca trade helps fight climate change, with over $1.6 million being raised for the Orca Climate Fund.
New use cases between other IBC-connected ecosystems and Solana protocols such as these will be unlocked with the launch of Composable/Picasso’s Solana <> IBC connection. For instance, users will be able to use Solana-based LSTs such as jitoSOL and mSOL and use them on other chains for restaking. In fact, Composable is working on a use case for restaking jitoSOL within our own ecosystem. Users can also perform cross-chain lending and borrowing between Solana and other networks through trustless (IBC) in conjunction with lending protocols like Solend and Marginfi. Moreover, new non-Solana based assets (like ATOM, DOT, and KSM) can become available in Solana (and vice versa), where they can be used in any of the above protocols and more, including being listed on DEXes like Orca.