Countdown to Octopus 2.0 Launch
The Era of $NEAR Restaking Unfolds
We are thrilled to announce that after months of dedicated development and rigorous testing, Octopus 2.0 is poised for its grand launch on December 17th. Marking this milestone, Ottochain, a vibrant community-based project birthed by Octopus Nation, will go live as the first appchain adopting $NEAR Restaking. Are you ready to explore the world of $NEAR Restaking and enjoy the opportunity to earn multiple staking rewards with a single staked asset?
On December 8th, Vivi Lin, partner and head of media at Octopus Network, participated in an engaging AMA session hosted by Marcus from the NEAR Foundation. The session unpacked $NEAR Restaking and dived into what NEAR community can expect from the upcoming Octopus 2.0 launch.
Eager to delve deeper? We have selected key excerpts for a quick overview. Alternatively, you can immerse yourself in the complete audio experience available on Spotify.
Q1
Marcus: First of all Vivi — Could you tell us about yourself and Octopus Network? We all know it is a key infrastructure at Near, but what exactly does it do?
Vivi: Hi everyone, I am very happy to be here to tell you all the exciting news about Octopus Network. My name is Vivi Lin, I am a partner of Octopus Network. A brief intro on myself, I come from a media background, used to work as a TV presenter and producer for global networks, such as Reuters Financial TV, covering the financial markets; stumbled into crypto around 2017, when I was doing a show about innovation in Silicon Valley, and I just went down the rabbit hole ever since.
Now, let me demystify Octopus Network for all of you. I know that you might have heard it here and there, but not knowing what it really does. At its core, Octopus Network is a multi-chain Web3 infrastructure that provides shared security and interoperability for decentralized applications.
We are at Octopus 2.0 now, but let me give you a bit more context with Octopus 1.0 — that’s when Octopus Network helped decentralized applications to launch and run appchains, because we believe Web3’s future lies in the hands of real applications, and by helping them build appchains in a cost-efficient manner, providing them with shared security, interoperability and a supportive community. Imagine, if you have a specific blockchain for your application while you still benefit from the security of the motherchain — which is NEAR in our case, you could customize many key features, such as your own transaction processing capacity, your tokens, your incentive models, and codebase. All of these features will greatly improve your user experience, which is the key for real adoption.
This has always been the direction we are working towards as an infrastructure — to help real adoption happen sooner in the Web3 space, and it has never changed, from Octopus 1.0 to 2.0. The major change is we’ve replaced $OCT to $Near for the shared security. We could dive deeper into the details later on, just to give you an overview now.
Q2
Marcus: Now that we are on the topic of Octopus 2.0, let’s dive right into it — tell us what’s that about?
Vivi: Absolutely.
Octopus 2.0 consists of 2 parts — one is $Near restaking, the other one is Adaptive IBC, which is to connect Cosmos to Near.
I’d like to give you and the audience a bit of context first. As mentioned earlier, Octopus Network serves as an infrastructure to help web3 projects build appchains, and one of the most important features is to provide affordable leased security solutions for new appchains. We all know that validators are the backbone of any Web3 and blockchain project, as they maintain the security, integrity and functionality of any Web3 network. So for new projects, this is particularly important, because they might not yet have a large network of validators or the resources to effectively secure their network against potential attacks.
At Octopus, we have the Octopus Network Relay that operates as a smart contract on NEAR, providing a validator marketplace where validators stake $OCT tokens to validate a specific appchain. This structure allows assets and contracts between NEAR and any appchain to communicate seamlessly.
That’s basically what Octopus 1.0 is about, and now with Octopus 2.0, we are taking all of these offerings to the next level — we will use $Near token instead of $OCT for restaking as the source of security for the appchains.
To put it simply, through restaking with $Near, appchains could get security in an even more cost-effective manner, greatly reducing their bootstrapping process; and with Near IBC, the IBC protocol will be extended beyond the Cosmos ecosystem and will be connected with Near. Eventually, the series of IBC bridges we are building will connect Near with various other blockchains, including Cosmos, EVM chains, Polkadot and appchains using Octopus’ infrastructure. Just imagine the possibilities it provides for all the web3 projects, would be endless.
Q3
Marcus: Why restaking? Why did Octopus Network come up with this idea?
Vivi: This novel concept of restaking was introduced by Eigen Layer, a project from Ethereum that has gained a lot of traction in the Web3 space. It provides a mechanism that allows ETH stakers to “restake” their ETH that has been staked to Ethereum POS. Some even say that re-staking is the biggest thing that has happened to Ethereum since MEV.
We also found the idea of restaking deeply inspiring. Our founder Louis Liu extended this concept and applied it to the Near protocol, hence we introduced $Near restaking, giving $NEAR stakers the ability to secure appchains with their staked $NEAR.
If we dive deeper, what restaking does is to expand one of the most precious things in crypto, which is decentralized trust, and make it scalable. Our founder Louis has a very interesting analogy, comparing the potential of restaking to the alternate current revolution. Similar to how alternate current opened up countless applications and enabled long-distance transmission, restaking holds the key to transforming the landscape of decentralized trust, as it breaks the traditional trust bottleneck and reduces dependency on centralized platforms. Many doors will be open because of that.
Q4
Marcus: The Near community might also want to know what benefits $NEAR restaking could bring?
Vivi: There are many.
For the $NEAR holders, the benefits are straightforward. Say if you are a NEAR holder, restaking allows you to multiply your earnings when you restake your $Near to validate other appchains.
For the broader NEAR ecosystem, the benefits are significant too. By enabling restaking with $Near, there will be more appchains and middlewares to use $Near as underlying staking asset, which will increase the value capture for $Near.
In addition, restaking encourages $NEAR holders to stake more, thus reducing the amount of $NEAR in circulation. This dynamic helps establish a healthier supply-demand balance for $NEAR.
Moreover a very important point we’d like to make, which is in line with Near’s open web mission, at Octopus Network, we are also committed to an open and inclusive approach to $NEAR restaking. The Octopus team plans to relinquish control of the restaking base contract, and make restaking an integral, immutable part of the NEAR base protocol. That means — the restaking infrastructure that Octopus built is permissionless, and any project in NEAR could use it for free to provide shared security with $NEAR restaking.
In fact, we have already had middlewares from Near that are interested in using the restaking infrastructure for $NEAR. We will keep you posted when we could share more good news.
If we look at an even bigger picture, Eigenlayer’s concept of restaking is seen by many as one of the most anticipated advancements for any PoS public chain. We believe the Octopus Network is uniquely positioned to leverage this concept for the benefits of NEAR, given our extensive experience in shared security since 2021.
Q5
Marcus: How about the value capture for the Octopus community, especially the $OCT holders, since the restaking is in $Near — how do you justify that?
Vivi: This is a great question — many people in the Octopus community have asked us about it.
On a bigger scale, using $NEAR for restaking, we align our interests more closely than ever, with the entire NEAR ecosystem, which in return, provides Octopus with more support and exposure that will be beneficial to the whole Octopus community.
If we go to the specifics — obviously we have $OCT holders’ interests at heart — with Octopus 2.0, we will be able to expand our market presence, generate more revenue, and ultimately increase $OCT holders’ interests through the buy back and burn mechanism.
Starting from 2.0, Octopus will upgrade its value capture mechanism from staking rewards to a buyback-and-burn model. This means that $OCT token holders will no longer need to stake any appchains to receive rewards. Instead, 30% of the income Octopus receives from appchains will be used to buy back $OCT tokens from open markets and then burn them. The reason behind the change is that we noticed — despite the low staking barrier and a simple one-step process, not many $OCT token holders participated in any staking. And we understand $OCT token holders’ anticipation for the token to appreciate, hence the buyback-and-burn approach will directly convert the revenues into market buying power for the $OCT token, in a more direct manner, which is more conducive to its value growth.
$Near restaking is really a multi-win situation.
Q6
Marcus: How does $NEAR restaking work?
Vivi: $NEAR restaking operates primarily through a smart contract known as the Restaking Base contract. To start the process, $NEAR holders deposit their tokens into this contract. Then they could delegate their $NEAR to any validator pool within the NEAR protocol that they prefer. Once this is done, they’re free to opt in with restaking to any appchains they choose.
As for L1 staking rewards, 100% of the restaking rewards from the NEAR protocol will be given to $NEAR holders. When it comes to appchains rewards, as mentioned earlier, 70% is distributed to $NEAR holders, and 30% will be revenues for Octopus Network, which the team will use to buy back $OCT tokens in the open markets and then burn them. In most situations, appchain rewards will be distributed in the appchain’s native token. However, the options could be flexible. It’s up to appchain teams and communities to decide how and how much will be paid to restakers.
Q6
Marcus: Octopus has announced that Ottochain will be the first Cosmos chain to adopt $NEAR Restaking in December. Can you tell us more about this project? How can $NEAR holders participate in it?
Vivi: Yes indeed! Ottochain is a grassroot project initiated by a group of people from the Octopus community under the name of Octopus Nation. It shows a lot of drive and engagement from the community, and when it was initiated, it received a lot of support from the community.
Ottochain will be launched on the 17th this month and will be the first appchain built with Cosmos SDK, also EVM compatible, that will be available for $Near restaking. As a gesture to show support for this community initiative, Octopus will sponsor 4 million $OCT tokens as rewards for re-stakers.
By adopting $NEAR Restaking, Ottochain ensures the security and integrity of chain consensus, which works as a great proof of concept for $Near restaking.
At its’ core, it aims to onboard more Web2 and Web3 communities into the Near ecosystem, fostering grassroot communities.
So in less than 10 days, $Near restaking will be live with Ottochain. It is very exciting. It will be very easy for $NEAR holders to participate.
If you are a $NEAR holder, you could simply restake your $NEAR tokens to earn rewards. The minimum amount required is 100 $NEAR. If you have experience running a node, things are even more interesting — you could be a validator for Ottochain and enjoy more rewards.
We will provide detailed guidelines on our website Oct.network prior to the mainnet launch — you could simply follow the steps and take actions.
So please stay tuned and keep an eye on our website and social media channels.
Q8
Marcus: How are you going to attract more Cosmos SDK-based projects to build on Octopus?
Vivi: It’s a good question. You know that’s why we love the open nature of Web3 and we’ve always believed the future is multi-chain — there are projects providing security to Cosmos SDK-based chains, which we respect, but at the same time, we believe we have our own competitive edge.
For example, Octopus offers one of the most cost-effective, accessible, and flexible sources of security, as explained earlier, with our restaking offering. Cosmos SDK-based projects could leverage the resources and support from not only Cosmos, but also the NEAR ecosystem especially when it comes to validators and community support.
On the other hand, we have been building partnerships with the Cosmos ecosystem since 2020, such as the development of the Substrate IBC pallet, our NEAR IBC pallet — the adaptive IBC as mentioned earlier. We have also contributed to the Cosmos developers training and the Cosmos HK Accelerator, in a joint effort to foster more opportunities for Web3 projects in a multi-chain future. In October this year, we also participated in the Cosmoverse conference in Istanbul, which is an annual big event in the Cosmos ecosystem, similar to NEARcon. We met many partners there, sharing with them our latest development and got really good feedback. All of these efforts will pave the way for winning the trust from the Cosmos ecosystem, hence being able to attract Cosmos projects to build with us.
As a matter of fact, several Cosmos SDK-based chains have already shown strong interest to adopt $NEAR restaking. We are confident that this trend will continue.
Q9
Marcus: One of the important pieces for Octopus 2.0 is the adaptive IBC with Cosmos as you mentioned earlier, could you tell us more about it — how does it work?
Vivi: One of the core technologies of Octopus Network is trust minimal blockchain interoperability. At Octopus 1.0, all the appchains are Substrate-based and interoperable with NEAR and other appchains. At Octopus 2.0, we’ll take it to another level after the Octopus team has been working on IBC protocol for nearly 3 years with Interchain Foundation- Now we are building the NEAR IBC Port, which will connect the NEAR protocol with Cosmos.
In terms of how it works — we know that IBC is one of the most adopted protocols to handle value and data transfer between two blockchains, invented by Cosmos. In many ways, it has redefined the way blockchains interact with each other. However, just like the well-known “blockchain trilemma”, the “cross-chain trilemma” also exists, whereas it requires a balance or compromise between security, cost, and efficiency. IBC was designed with security as its top priority and it serves the Cosmos ecosystem well, but when it needs to verify a typical block header using a light client, between a Cosmos chain and a heterogeneous blockchain, aka non-Comos chain in this case, the gas costs could be significant.
To address this, the Octopus technical team has introduced the concept of “adaptive IBC,” which is to replace the light client with an off-chain verification proxy and a corresponding proxy client.
Let’s take the cross-chain transaction between NEAR and Cosmos as an example — the verification proxy will maintain the consensus of the Cosmos chain, verify all cross-chain messages, and sign them with its own key. Then on the NEAR blockchain, the proxy client only needs to verify one single signature, drastically reducing the computational work. The same setting is applied in both directions, making cross-chain transactions more feasible and cost-effective.
Now we do understand that the introduction of verification proxies can be seen as compromising the security of cross-chain bridges, that’s why we aim to avoid the pitfalls by building our verification proxies on a public chain that we call the “proxy chain”. This chain ensures the decentralization of the verification proxies to some extent — as long as its security level is not lower than those of the two chains it connects, it doesn’t necessarily compromise the overall system’s security.
On the other hand, we are also constantly looking out for better ways to upgrade and enhance security, for example, once the ZK consensus proof matures, we could replace NEAR side’s proxy client with a ZK verifier, and the verification proxy with a ZK prover, hence more secure.
Therefore, we think that’s a balance worth having.
Q10
Marcus: We’ve seen the latest news that Secret Network will become the first Cosmos project to use adaptive IBC — could you shed more light on it? What can we expect from this collaboration?
Vivi: Sure. Secret Network is one of the longest-running confidential computing blockchains from the Cosmos ecosystem, so this upcoming integration marks a significant milestone as it establishes the first connection between the Cosmos and NEAR ecosystems.
At the first stage, our collaboration will focus on enabling the bridging of assets, so this will allow people in NEAR to perform things like confidential payments and confidential DeFi.
For the next stage, we will work together to pursue the goal of general-purpose message passing between NEAR and Secret Network. This will enable d-apps running on NEAR to securely store confidential information on-chain in a transparent manner.
We plan to complete the integration in Q1. One thing that it relies on is a network upgrade on the Security Network side. Before connecting, they’ll need to complete a network upgrade to upgrade one of their IBC components — IBC Go — to the newest version. Once that is done, we can go ahead and start connecting to Secret Network.
Q11
Marcus : Can you please share where people can find out more? Can they join a Telegram or Discord group? What’s your website and Twitter handle?
Vivi: Yes, definitely. We have everything set up for our community to connect with us. The easiest way to get started is to visit our website. You can also follow us on Twitter for more updates. Once there, you can find all the entry points to join the Discord channel and Telegram. If you’re interested, you can become an $OCT holder and delegate your tokens to become an active member of the community. We also hold a community call on the 8th of every month on Discord. Additionally, we have articles posted on Medium, and you can follow us there as well. If you have any questions, our team is ready to assist you. You can DM us or send us messages on Twitter or Telegram, and we’ll be there to help. We are deeply grateful for the support from our community, as well as the NEAR community. Hope we continue to grow and prosper together in this journey!
Follow Octopus Network!
- Website: https://oct.network/
- Twitter: https://twitter.com/oct_network
- Accelerator Program: https://accelerator.oct.network/
- Medium: https://medium.com/oct-network
- Discord: https://discord.gg/6GTJBkZA9Q
- Telegram: https://t.me/octopusnetwork
- Youtube:https://youtube.com/channel/UCkMYDmXdgjCBTBggSEAy0ZQ
- Github: https://github.com/octopus-network
- Docs: https://docs.oct.network/
