ElkNet seeks to overcome many of the limitations of traditional bridges. In this article, we take a deeper dive into the protocol to show how it outperforms its peers.
[ElkNet network update: we have implemented several fixes and failsafes for the RPC issues that were creating instability in the network. The updates have undergone several days of rigorous internal testing, and we are generally satisfied with the results. ElkNet is online, try it out yourself!
During the network downtime, we were also able to add a swap for gas function, which will allow users to receive a small amount of gas tokens on the destination network along with their ELK transfer. This was a highly requested feature, which helps users who wish to migrate their ELK to chains where they do not currently hold any funds.]
Greetings Elk! As you have most probably noticed, we have “stealth” launched ElkNet & also raised the transfer limit to $ELK 1000 per transfer. Go ahead and give it a try: https://app.elk.finance/#/elknet
In the initial launch announcement for ElkNet, it was mentioned that we would be publishing follow-ups providing detail on the technical aspects and planned features of the mainnet. For this first article, we will provide a basic overview of how ElkNet works, highlighting the key advantages over traditional bridges. Note: several of the responses below are adapted from the ElkNet launch AMA.
How does ElkNet work?
Only one token ever passes through the mainnet and moves across chains: the $ELK token.
This is a key design element that sets ElkNet apart from most other bridges and solves several of the problems that exist in other cross-chain protocols, which tend to be slow, expensive, unreliable, and unable to scale.
Think of it this way: blockchains are complex systems. Building a bridge to connect two blockchains together adds a layer of complexity. Now imagine connecting multiple chains to form a fully interoperable multi-chain network.
Now, as any engineer will tell you, the solution to a complex problem is to design a simple, sturdy machine to perform the essential functions, while delegating most secondary operations to the periphery.
ElkNet is designed to move $ELK, while ElkDex provides all the necessary liquidity for cross-chain swaps, loans, and other types of transactions. The mainnet ensures that anything that comes in goes out again and that nothing is lost or comes out multiple times.
Unlike regular bridges, ElkNet does not require an equal quantity of tokens to be locked on either side in order to function, so scaling or insufficient exit liquidity are no longer problems.
How does ELK move through ElkNet?
Essentially, $ELK enters a contract on Chain A, where it “disappears” (is burned, or locked) on that chain to enter the mainnet. From the mainnet, it passes through a smart router, which finds the most cost efficient path before exiting through another contract on Chain B where it “reappears” (is minted) as $ELK.
Swapping tokens follows the same basic process, with one additional step: when a swap is initiated, the token is automatically converted to $ELK through the liquidity pools on ElkDex (and eventually other AMMs) and converted back to the desired token on the target chain.
How much does the cross-chain swap cost?
While ElkNet is in beta, all transfer fees for moving $ELK across ElkNet are waived. The exact same amount of $ELK on Chain A will appear on Chain B. Eventually, there will be a small amount of $ELK burned as it passes through the mainnet as a deflationary mechanism.
Therefore, the only cost for cross-chain swaps using ElkNet are the gas fees on the starting chain required to process the conversion to $ELK and back. The rough cost for each network is currently:
- AVAX 0.05
- MATIC 0.0002
- FTM 0.01
- HECO 0.0005
So, little more than the cost of a basic in-network swap. Compare these to the price of other bridges, and you will see the cost benefit of using ElkNet.
The full mainnet should support thousands of transfers per second. In the current beta stage, ElkNet is capable of processing 20 transfers per second, so well short of our goal, but still orders of magnitude faster than most other bridges.
The mainnet bandwidth depends heavily on RPCs. ElkNet currently relies on public RPCs for each of the chains Elk serves, but we are already in the process of building our own resilient network of RPC nodes that support the mainnet. A second scaling boost will come with the release of the ElkNet nodes for users to run, which will also come with the added benefit of decentralization.
The basic ElkNet does not yet allow users to run their own nodes. When this feature does become available, the technical requirements for operating a node will need a modest-size server or a PC with generous bandwidth and connectivity to various RPCs on supported chains.
ElkNet nodes can be run independent of a wallet, but there will be a minimum amount of ELK required to stake for running a node. This staking requirement is intended to protect the network against misbehaving actors. In this way, you can think of ElkNet node operators as validators for the Elk network, who carry out the consensus functions through a conventional staking mechanism.
It is also important to understand that ElkNet nodes are not the same as the chain-specific parachain nodes that require Moose NFTs to operate. These parachain nodes will be used to support actual chain-specific applications that leverage the Elk mainnet.
The applications might involve proxy tokens, multi-chain index tokens, cross-chain loans, stablecoins, etc. — basically anything a developer interested in a multichain protocol can think up.
The goal of the Moose is to provide a kind of “key” to make sure developers are serious about their Elk apps, but since the paranodes are on-chain applications, decentralization is not a concern.
We plan to provide additional details about both types of nodes as they become ready to be deployed.
Is ELK a token or a coin?
Our mainnet kind of blurs that distinction. It is a token on the chains where it lives and behaves like any other ERC20 token. For the few milliseconds that it passes through the mainnet, it is technically the native “coin.”
As the mainnet evolves, it may become possible for $ELK to stay on the network and perform additional functions, but for now it is best to think of it as a token with a special ability. You might even say it’s “Elk-emy.”
The Road Ahead
For a more detailed list of mainnet milestones, see our Road to Elk Mainnet. In addition to the mainnet milestones, during Q3 and Q4 2021 we plan to add support for multiple new chains and improve the user experience through a website redesign and a mobile app to support ElkNet, among other features.
The next planned feature is sending $ELK to a different address via ElkNet.
About Elk Finance
Elk Finance is a decentralized network for cross-chain liquidity. ElkNet, its cutting-edge multi-chain protocol, makes it easy for anyone to move value and exchange cryptocurrencies across blockchains quickly and securely at a low cost.
The ElkNet framework also lets developers imagine and build novel cross-chain applications. To date, ElkNet supports Avalanche, Polygon (Matic), Fantom Opera Network & Huobi ECO Chain.
Links to our website, charts & community channels can all be found here.