Upcoming 2022/02/02 on Osmosis Updates from the Lab: Justin Kilpatrick (Althea/Gravity Bridge)

Osmosis Updates from the Lab occurs every Wednesday at 10 AM EST (3 PM UTC) on the Osmosis Zone Twitter Space. Replays are available on the Osmosis YouTube channel or the podcast.

Justin Kilpatrick, co-founder and CTO of Althea, last stopped by the Lab in mid-October. Back then, he announced Althea’s imminent launch of the Gravity Bridge with its own validator set. Osmosis was excited at the prospect of using a decentralized bridge to Ethereum that would employ Bech32-ICS20 auto-forwarding to abstract away some of the hassles of bridge UX.

The Gravity Bridge chain went live in December, and the UI came online last week. For the moment, withdrawals are unavailable in the app, though power users can move funds off-chain with the CLI. Hopefully we’ll get a timeline for the fully functioning platform on Updates!

At a high level, the Gravity Bridge works by burning or locking an asset on one side and redeeming or minting it on the other side. For example, a native asset (ETH) is locked in the Gravity.sol contract (in batches, to save gas) and a representative token/voucher (e.g. gravETH) is issued on the Gravity Bridge chain, which can then be forwarded via IBC to Osmosis or another chain. If someone wants to take the asset back over the bridge, the Gravity Chain would burn the gravETH and have the Ethereum contract unlock the appropriate number of ETH there.

There is a fairly complex interplay between the parts of the bridge. The Cosmos validators control the Gravity.sol contract on Ethereum. The Gravity module on Cosmos mints representations of Eth assets on the Gravity Bridge chain, and the Orchestrator keeps the validators running that module in sync. Further, the validators must all run full nodes on Ethereum to send oracle data to the Orchestrator. I leave it to the Updates team to discuss the technicals in more detail, or you can read this medium-level overview.

How is Gravity Bridge decentralized, and how does it prevent validators from stealing funds? On the Cosmos side, the chain has a full set of validators like other Cosmos chains, so the trust assumptions are similar to other Cosmos chains running Tendermint consensus. As long as the validators are sufficiently decentralized and have more stake to lose by forming a cartel to attack the funds in the bridge than they would gain by such an attack, the bridge is safe. Adding interchain security as planned will further raise the cost of attacking the chain. It is exciting to see a Gravity Chain commit to using interchain security. I am curious as to whether they have specifics in mind, or if they are planning to play it by ear.

I would also like to hear about the token distribution of Graviton (GRAV) — an airdrop has been implied, but no official announcement has been made. With the recent rejection of the proposed ROWAN/rETH pool on Osmosis (63.9% to 20.7%, 58.2% turnout), the spectre of token representation wars has reared its ugly head.

The Osmosis team has issued a position paper on the subject from which I take the following points. We must maintain excellent UX, and we should not fragment liquidity. Therefore, we must not create an environment where bridged assets multiply endlessly. However, making the tokens of multiple bridges fungible on Osmosis is a complex problem: representative tokens inherit the variable security and trust profiles of the bridges that create them, and a depeg on one bridge token can cause a run on the pool, causing liquidity providers to suffer.

The Osmosis solution in the short term is to maintain a single canonical representation of the bridged assets, not by fully integrating a bridge into Osmosis (like Injective, Thorchain, and Sifchain), but by using the bridge-as-service provider model. Osmosis governance will choose the best bridging service based on “cost, features, reliability, customer service, ease of use, and user base network effects.”

With that in mind, it may be useful to ask how Gravity Bridge views the asset representation wars. And what are advantages of Gravity Bridge over Axelar and Sifchain?

In the long term do we think that this tweet from Jack Zampolin is correct? “Logical end state of bridges is that they carry cross chain calls instead of token representations.” I take that to mean that all assets will live on their native chains and be integrated into cross-chain DeFi as abstractions because wallets will be able to interact on every chain via IBC semantics.

Althea as ISP

In case you didn’t know, Althea is not just the developer of the Gravity Bridge chain. They are building a decentralized Internet Service Providor by harnessing the blockchain to coordinate various infrastructure providers.

Their plan seems to be to build a customer base through providing services to rural areas where it is easier to compete against large ISPs that do not want to build infrastructure in rural areas. Once they have some market share, the efficiencies of running on a blockchain will enable them to compete more broadly.

Althea wanted their customers to be able to pay for internet services with Ethereum-based stablecoins like USDC and DAI. But they also wanted their own app-specific blockchain to take advantage of the sovereignty and interoperability provided by the Cosmos SDK, IBC, and the interchain.

For this they needed a bridge, so they built one, and now we have the Gravity Bridge chain. It’s yet another testament to the ambition and engineering-power of the teams working in the Cosmos. All these teams have worked together in a decentralized way to build something marvelous.

Find out more about Althea and Gravity Bridge on their webpages. The Gravity Bridge Discord is far more active than the Telegram. Check out Althea and Gravity Bridge on Twitter as well.

Please join us Wednesday! There’s so much to talk about. Bring your questions, or get them to Kevin Berrey or Dynamicmanic on social media.

Enter the laboratory at Osmosis.zone, the first decentralized exchange powered by the Cosmos SDK and IBC. See our published lab reports at the Osmosis blog, our bench notes at GitHub, and help plan future experiments in our Commonwealth

Connect with other DeFi Scientists by following us on Telegram, Twitter, Discord, Reddit, and the new Facebook and Instagram pages

Reach out to the Osmosis Ministry of Marketing by Email or Twitter and the Osmosis Support Lab by Email or Twitter