The Power of Chain Abstraction and Chain Signatures on NEAR Protocol
Educational session and deep dive
In the pursuit of mainstream adoption of Web3, the concept of chain abstraction emerges as a pivotal step forward. By streamlining the user experience and unifying the functionality of various blockchains, chain abstraction promises to make the decentralized web more accessible and user-friendly. At the forefront of this movement is NEAR Protocol, an ecosystem that has been pioneering efforts in this direction since 2018. In this article, we will dive into the significance of chain abstraction and explore how NEAR’s chain signatures are setting new standards in cross-chain transactions.
At Web3 Day hosted by We Are Developers the NEAR Balkans Tech Lead Alen Meštrov, executed an educational session on the topic chain abstraction and chain signatures. Before we jump into the details of chain abstraction and chain signatures, we invite you to enjoy the full educational session.
Understanding the Fragmentation Challenge
The prevailing narrative in Web3 revolves around modularity, which involves the segregation of distinct functional layers within a blockchain. These layers include consensus, settlement, data availability, and execution, aiming to enhance scalability, security and flexibility. While modularity holds promise for scalability, it unintentionally contributes to fragmentation across liquidity, applications, and user bases. This fragmentation complicates the user experience and imposes limitations on developers who must follow specific tech stacks, consequently constraining their audience reach.
The Concept of Chain Abstraction
Try to imagine a scenario where users engage in everyday activities, such as purchasing clothing or participating in events, seamlessly unlocking rewards and badges with inherent utility. These rewards might grant access to special events, offer discounts, or provide other tangible benefits. What’s really amazing about this is that users do not need to understand the blockchain technology in depth or recognize underlying mechanisms governing each transaction. This abstraction of complexity transforms blockchain into an underlying engine that powers digital interactions, while user knowledge about the blockchain space becomes a matter of preference rather than a necessity.
Addressing Limitations in the Current State
The current landscape of blockchain technology is characterised by fundamental limitations, similar to a scenario where a Gmail user is unable to send messages to an Outlook email address. Similarly, in the Web3 domain, fragmented addresses present significant challenges, hindering seamless interoperability between different networks.
The Role of Chain Abstraction
At its core, chain abstraction aims to mitigate the escalating fragmentation within the modular landscape of Web3. While the tangible impact of chain abstraction primarily manifests at the user experience layer, its underlying principles leverage innovation at the security layer. One notable advancement is the rise of Zero-Knowledge (ZK) technology, which remodels ledger security by enabling a single computer to validate transactions across multiple chains using concise proofs. This concept of cross-settlement ensures mesh security, facilitating the secure transfer of assets between different blockchain networks.
Key Components of Chain Abstraction
Achieving unified security consists of addressing two fundamental requirements at the foundational level: data availability (DA) and decentralized sequencer. Let’s first demystify these two terms. Data Availability in the blockchain world ensures that transaction data is included in each produced block and is accessible to every node in the network. Essentially such an approach maintains the credibility, integrity and trust of a blockchain, allowing everyone to independently verify the validity of transactions, pushing the narrative “Trust, but verify.” NEAR DA, for example, made it possible for ETH Rollups to transfer the execution layer of Ethereum to NEAR Protocol, so they can enjoy fast and cheap transactions, while not compromising the security of the network. Sequencers play a fundamental role within rollup networks, handling critical tasks such as receiving, organizing, executing transactions, and submitting transaction data to be included in blocks. Relying on centralized sequencers, means having a single point of failure, that is where decentralized sequencers come into play. Decentralized sequencers eliminate the need for participants to place blind trust in a central authority. Transactions undergo validation and consensus across a distributed network of nodes, promoting transparency and reducing susceptibility to manipulation. Building upon this foundation, identity management enables users to possess addresses across various blockchain networks, facilitating seamless asset transfer. This concept, also known as account aggregation, empowers users to utilise different blockchain ecosystems effortlessly. Furthermore, the integration of decentralized frontends, epitomised by platforms like DapDap, consolidates the application layer, offering a unified interface for interacting with diverse blockchain applications.
NEAR’s Pursuit of Chain Abstraction
NEAR Protocol has been at the forefront of advancing chain abstraction since its very inception back in 2018, driven by a commitment to usability, flexibility, and scalability. The NEAR stack has evolved to support comprehensive chain abstraction across diverse networks and application domains, offering features such as:
- A scalable, integrated blockchain infrastructure
- A security aggregation stack incorporating NEAR Data Availability (DA), zkWASM x Polygon Labs, and EigenLayer powered Super Fast Finality.
- Account aggregation capabilities enabling seamless cross-chain transactions
- A strong data layer supporting various blockchain configurations
- Decentralized frontends offering a unified user experience for diverse blockchain applications, exemplified by the Blockchain Operating System (BOS)
- Super (app) wallets streamlining user interactions across Web3 networks without the need for network switching or gas token management.
Introducing Chain Signatures
At the heart of NEAR’s chain abstraction efforts lies chain signatures — a fresh technology that enables NEAR accounts to sign transactions for any blockchain. Powered by decenentralized multi-party computation (MPC) network and dual quorum security model provided by NEAR Protocol and EigenLayer validators, chain signatures allow NEAR accounts to interact with multiple blockchains without the need for complex bridging mechanisms. This innovative approach opens up a world of possibilities for cross-chain transactions, enabling seamless interoperability between different blockchains networks, executed through one main NEAR Protocol Web3 account acting as master account, holding keys to all chains. Currently supporting prominent blockchain networks such as Bitcoin, Ethereum, Cosmos, DogeCoin, and XRP Ledger, Chain Signatures are poised to expand compatibility to additional networks including Solana, TON Network, and Polkadot.
Facilitating Multichain Transactions
One of the features of Chain Signatures is its ability to facilitate multichain transactions through threshold signatures controlled by NEAR accounts and smart contracts. By enabling NEAR accounts to request signature verification for transactions on external blockchain networks, chain signatures eliminate the burnden of managing multiple blockchain addresses through multiple wallets. The chain signatures MPC network operates as a decentralized signer, seamlessly managing transaction requests across diverse blockchain networks, without exposing the users to additional complexities and inbetween steps. The easiest way to understand chain signatures is as batch transactions that are packed in one single transaction for the end user.
Multichain Gas Relayer
Moreover, NEAR introduces the Multichain Gas Relayer, a transformative solution that simplifies transaction cost across different blockchain networks. This innovative mechanism allows users to utilize NEAR or NEP-141 tokens to cover gas fees on any blockchain network, eliminating the need for native gas tokens. As a result users can navigate between different blockchain networks without encountering gas token management complexities.
Real World Applications of Chain Abstraction and Chain Signatures
The particular utility of chain abstraction and chain signatures is evident in various RWA within the NEAR ecosystem:
- SWEAT Economy leverages multichain gas relayer to enable users to send transactions from NEAR to BNB chain, paying for gas with SWEAT tokens earned with the platform
- East Blue utilizes NEAR chain signatures to pioneer Bitcoin DeFi use cases, unlocking new avenues for extending Bitcoin functionality through smart contracts
- LiNEAR develops a multichain, multi-asset staking framework on top of EigenLayer, facilitating secure restaking of non-ETH assets, including NEAR, for application security
- Mintbase enables NEAR based wallet holders to directly purchase Ethereum based NFTs, showcasing seamless interoperability between NEAR and Ethereum ecosystems.
As we navigate the landscape of Web3, chain abstraction emerges as the path to seamless interoperability and enhanced user experiences. NEAR Protocol’s commitment to advancing in this narrative sets the stage for a more connected and accessible digital future. By utilising these innovative technologies, we can unlock the full potential of the decentralized networks and unlock a new era of digital empowerment for individuals worldwide.
