UMA’s optimistic oracle unpacked: an Across Protocol case study

Tldr; Across Protocol is an optimistic bridge for moving assets through the cross-chain ecosystem. As Across is secured by UMA’s optimistic oracle, it’s much faster and cheaper than its competitors.

Key takeaways:

• Across Protocol is one of the foremost projects secured by UMA’s optimistic oracle.
• Across leverages the OO to help users move assets at a high speed and low cost.
• UMA’s Across integration highlights the flexibility and power of its optimistic design.

Since launching in mid-2021, UMA’s optimistic oracle has processed more than 10,000 data assertions for some of Web3’s leading projects. Best described as Web3’s decentralized truth machine, UMA takes any kind of verifiable data about the world and trustlessly records it on the blockchain.

As the OO is flexible, UMA has successfully integrated a wide range of projects. The largest to date is oSnap, an Optimistic Snapshot Execution tool that enables trustless coordination for DAOs. But while oSnap has been a huge success, the OO has many other use cases.

One of the most popular projects secured by UMA is Across Protocol, a cross-chain bridge that enables fast and cheap token transfers between Ethereum and Layer 2. In this piece kicking off our new UMA’s optimistic oracle unpacked series, we explain how the OO makes Across work.

Notably, the OO went live at the height of crypto’s last bull market, yet its total value secured has held strong through a prolonged market slump. This series offers an insight into why the OO continues to shine via the projects that rely on it every day.

How does UMA secure Across Protocol?

At face value, Across may seem like many other cross-chain bridges: it connects Ethereum to Layer 2 networks like Optimism and Arbitrum so that users can move their tokens through the ecosystem.

Yet Across differs from its competitors, in large part due to its optimistic design. UMA’s OO secures Across, verifying bridge transfers and settling rare dispute cases.

When a user bridges their assets from an origin chain with Across, relayers send the requested funds to the destination chain and then wait for the OO to verify that the order was filled. Similar to DeFi mainstay Compound, the user effectively takes a loan from the relayer and pays a small fee in return. As relayers “optimistically” fill orders, this process happens extremely quickly. The user gets their assets fast and then moves on with whatever they want to do on the new chain.

Across was built to optimize for capital efficiency, using a single liquidity pool and interest rate model. It’s also gas-efficient thanks to robust code checks and the OO eliminating the need for onchain validation.

The OO also ensures that Across stays secure. UMA is verified by humans, so regardless of how many people use the bridge, it only takes one honest actor to dispute a transaction. Anyone can raise a dispute through UMA, with $UMA tokenholders responsible for settling bonds.

By leveraging UMA’s OO, Across offers Web3 users the fastest, cheapest, and most secure way to bridge their assets through the crypto ecosystem.

What’s the relationship between Across and UMA?

Crypto power users know from using Across that it’s the best bridge for getting from A to B on the market today. But many are less familiar with its relationship with UMA.

Put simply, UMA’s OO makes Across work. It’s the system that ensures order fills get repaid and dispute cases get settled.

One question users have about Across and UMA stems from the projects’ core teams. Across was built by a group of exceptionally talented engineers, financial experts, and other domain specialists at Risk Labs, the same entity that oversees development of UMA.

While Across’ team members work alongside UMA’s at Risk Labs, the protocol can primarily be thought of as a use case for UMA’s OO.

But Across is just one example of a successful UMA integration. The OO also secures millions of dollars in the DAO ecosystem via oSnap, decentralized prediction markets, cover protocols, and more.

Across in numbers

Across launched at the beginning of the last crypto bear market in November 2021 and has processed over $2 billion in lifetime volume. It outshines its competitors on several key metrics today.

As relayers take on finality risk on behalf of users, Across regularly fills orders in under a minute. It’s also cheaper than other solutions, offering fee savings of up to 75% versus major competitors. Similarly, Across consumes up to 80% less gas than its competitors as its code is so tight.

Across is consistently the cheapest bridge for Layer 1 >> Layer 2 and Layer 2 >> Layer 1 transfers (Source: Across Protocol)

Across’ speed and price benefits have recently been reflected through aggregators like Socket and LI.FI. Though Across is not yet “winning” in overall market share, it’s become the dominant bridge in aggregator volume. In other words, when users ask an aggregator to process their request based solely on fundamentals, they bridge with Across.

Across is one of UMA’s largest integrations. Of the $153 million UMA secures at the time of writing, Across accounts for just over $53 million. That’s about one third of the OO’s total value secured.

Across Protocol currently accounts for 34.8% of UMA’s total value secured, trailing only oSnap.

Why the future is optimistic

Across’ lead in the bridging space highlights the power of optimistic systems. While users aren’t short of options for bridging tokens, none of them come close to Across on speed, price, and gas efficiency. The OO plays a significant role in Across’ success story.

Other bridge solutions opt for mechanisms such as mint and burn and native swaps, though such designs have drawbacks. Even for bridges that adopt optimistic systems, they do not offer the same speed, price, and security benefits as the OO.

Several optimistic projects that share similarities with Across have emerged in other areas of the crypto ecosystem in recent months. UniswapX, an intents-based protocol developed by crypto’s top DEX, takes inspiration from Across to offer cross-chain swaps (the Uniswap Labs team credited Across in its whitepaper). More recently, the Layer N team has teased its new optimistic zero-knowledge rollup concept with ambitions of scaling Ethereum for mass adoption.

As the Web3 ecosystem evolves, we’re excited to see projects adopting similar approaches to Across in their designs. We also look forward to helping new bridges and other solutions integrate the OO in the future.

What’s next for UMA?

While Across is one of UMA’s top partners, it’s just one example of the OO’s many use cases. The OO can be used to serve any kind of data to smart contracts, which means its scope is limitless. Today, the OO secures crypto’s best bridge, as well as prediction markets, insurance markets, and vital DAO tooling. But we’re just as hyped about the projects UMA will support in crypto’s coming adoption wave.

UMA’s optimistic oracle unpacked series continues with a deep dive on Web3’s top prediction market, Polymarket. Keep an eye on our blog and social channels for an update in the coming weeks.

If you want to learn more about UMA’s optimistic oracle or you’re ready to integrate with us, fill out our partnerships form, DM us on Twitter, join the UMA Discord server, or reach out at integrations@uma.xyz.