[Case Study] Permissionless Interoperability In Action With DAM Finance

Permissionless Interoperability. We write about it in everything we publish. We believe it’s key infrastructure for the modular blockchain stack. Everything we do at Hyperlane is to make interoperability accessible to any developer, any user, on any chain.

But what does Permissionless Interoperability (PI) look like in action? What is the thought process for developers considering it? Why is Hyperlane the best interoperability solution, especially for long-tail chains? A quick case study on DAM Finance and its use of PI:

The Problems DAM Faced

For context, DAM Finance is an interchain stablecoin protocol that recently expanded to Astar Network through its permissionless deployment of Hyperlane there. Its stablecoin d2o is collateralized by USDC on Ethereum, and teleported to destination chains through a mint-and-burn architecture powered by Hyperlane. d20 benefits destination chains by effectively bringing USDC synthetics to chains without USDC.

As a dApp based on Ethereum and Moonbeam, DAM was looking to expand its stablecoin to other chains and access new users/liquidity. But they ran into multiple problems:

The *Permissioned* Interoperability Roadblock

To access interoperability, developers need to lobby permissioned interoperability teams to deploy on their chains. But most interoperability teams don’t even want to spend time deploying on your chain if it isn’t already big. So how can your chain grow big if it doesn’t have interoperability to onboard new users? It doesn’t make sense and hurts long-tail chains.

Unscalable Deployments

Even if there is an existing interoperability solution on a chain, as an interchain app you’re limited by their roster of supported chains, slow deployment pace, and have no control over where they deploy in the future. Your growth as an interchain app is dependent on the permissioned interoperability team’s decisions.

No Control Over Your Security

Most interoperability protocols today are built with a one-size-fits-all security model, where every supported chain is immediately opted-in to a connection with newly added chains. Under this model, the attack surface increases as more chains are added. And you can’t do anything about it as a developer. You have no control over your own app’s security! You have to trust them to maintain perfect security across all deployments.

See a theme here? The dependence on permissioned interoperability solutions directly endangers and stalls growth for new chains and interchain apps.

DAM needed an interoperability solution that they could permissionlessly deploy themselves with minimal code changes, control future deployments, and control their own security.

Why Hyperlane Was the Best Solution

Permissionless > Permissioned

• The permissionless-ness of Hyperlane is a direct developer experience improvement over the permissioned incumbents. DAM didn’t need to lobby anyone to deploy Hyperlane to Astar.

“We chose Hyperlane primarily because the technology was sound and the permissionless deployment model allowed us to deploy on our terms.” — Roger Willis, DAM Finance

• PI is exponentially more scalable than existing interoperability solutions that need the core team to manually deploy everywhere. Anyone can deploy Hyperlane.
• Permissioned solutions ignore developer needs and create dependencies on the core team for future deployments and maintaining security.
• All it takes is one team to deploy Hyperlane. Once DAM deployed Hyperlane, everyone on Astar can now access interoperability and take their apps interchain.

Smooth Developer Experience + Deployment Process

• Why would DAM deploy Hyperlane when parachains have XCMP? For developers comfortable with Solidity and EVM, Hyperlane represents a much more intuitive and simple interface, making it an ideal fit for this use case and developer base. In addition, Hyperlane gives DAM interoperability with chains outside of the Polkadot ecosystem.
• No need to wait months for permissioned interop teams to deploy, DAM was able to permissionlessly deploy Hyperlane right out-of-the-box with minimal code changes.

“We were able to set up a wholly new deployment — to a network which was unsupported by all other interop providers — and go to production in under a month.”

• Comprehensive documentation like our Permissionless Deployment walkthrough here made Hyperlane easy to build with
• Responsive Hyperlane core team made any troubleshooting stress-free

“During our implementation phase, the Hyperlane team were helpful and super responsive to any queries.”

Modular Security

• Hyperlane gives developers the ability to customize their interchain security with Interchain Security Modules (ISMs). So DAM doesn’t need to rely on a permissioned interoperability team to decide the security for them. You as the developer are in control of your security. Modular security removes the dependency.
• You can customize and stack different ISMs like security legos. You can control which chains your app connects to, which ISMs your transactions from specific chains are filtered through, how different types of transactions are secured, any security logic can be encapsulated in an ISM. With modular security you can effectively silo your app’s security away from any network failure.
• Sneak peak: We’re working on incorporating economic security into Hyperlane, where every interchain transaction can be secured with a base layer of economic security, in addition to the customizable ISM layers.

Looking Beyond

Hyperlane is bringing the same developer-friendly Permissionless Interoperability stack to multiple new VMs and rollup ecosystems. We look forward to bringing more freedom to these chains and empower any developers/users to access them.

Deploy Hyperlane to your chain now.

More about Hyperlane

Hyperlane is the first Permissionless Interoperability layer, enabling anyone to connect any blockchain, out-of-the-box. With Hyperlane, developers can build Interchain Applications, apps that abstract away the complexity of interchain interactions and serve users on any connected chain. Additionally, Hyperlane’s modular security stack gives developers the power to customize their interchain security. Hyperlane development is open-source and led by core developers at Abacus Works.

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