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In an age where protocols are becoming progressively multichain, the requirement for dependable bridges and interoperability across chains is reaching new heights. LayerZero is stepping up to this challenge, consistently offering the vital infrastructure that enables an interoperable and omnichain cryptocurrency ecosystem.
Now, let me introduce myself. My name is Zifa, and I’ve dedicated over two years to writing about intriguing projects in the crypto sphere. As the buzz around the potential ZRO token airdrop intensifies, I believe it’s an ideal time to delve deeper into LayerZero, the project behind it. Join me as we explore the intricacies of this exciting endeavor.
What is LayerZero crypto?
LayerZero, based in Vancouver, British Columbia, provides a cross-chain messaging infrastructure that grants decentralized application developers access to multiple blockchains without an intermediary for these cross-chain interactions. The system uses an innovative architecture that includes Ultra Light Nodes and independent Oracles and Relayers to safely transfer messages between chains.
LayerZero aims to connect all blockchains so seamlessly and intuitively that users won’t even realize they’re using it. This will facilitate existing and emerging decentralized applications to break the boundaries of EVM or non-EVM, thereby initiating the first-ever omnichain applications.
How does LayerZero work?
For the transfer of messages between on-chain endpoints, the procedure of LayerZero depends on two entities: an Oracle and a Relayer. When a User Agent (UA) dispatches a message from one chain (A) to another (B), the message is first passed through the endpoint on chain A. This endpoint subsequently alerts the UA-specified Oracle and Relayer about the message and its intended chain. The Oracle then transmits the block header to the endpoint on chain B, and the Relayer submits the transaction proof. After the proof is verified on the receiving chain, the message is then forwarded to the final destination address.
LayerZero protocol, explained. Image source: LayerZero’s whitepaper
LayerZero Endpoints
LayerZero employs a collection of smart contracts called LayerZero Endpoints on each supported chain. Apart from connecting all the chains supported by LayerZero, they can be deployed on new ones to include them in the network. An example of this would be cross-chain borrowing, where transaction details are sent from one blockchain (like Ethereum) to the LayerZero Endpoint on another chain (like Avalanche), facilitated by independent off-chain entities, the Oracle and the Relayer.
LayerZero’s security is based on the idea that if two independent entities can confirm a transaction on one chain, another chain can trust and conduct that transaction. After receiving transaction details, the Oracle creates a block header, while the Relayer independently generates a proof. If both agree, the transaction is deemed valid and completed on the second chain.
However, concerns have been raised about the potential collusion between the Oracle and the Relayer, posing a risk to the platform’s security.
LayerZero is modular and scalable. It allows adding new chains and features without changing the core protocol, offering more flexibility compared to other solutions that may necessitate significant protocol modifications for adding new chains.
Is there a LayerZero token?
While there hasn’t been any official confirmation of an airdrop from the team, there’s widespread speculation about a potential ZRO airdrop happening soon. This speculation has been fueled by a noticeable increase in the volume of LayerZero’s omnichain bridge — Stargate, as hopeful users intensify their activities to qualify for the potential airdrop. Airdrops have grown to be a prevalent method for blockchain initiatives to establish a dedicated user base and offer a return on investment for stakeholders.
Who uses LayerZero?
LayerZero’s ecosystem
LayerZero is primarily used by decentralized application developers who need to communicate across multiple blockchain networks. Moreover, a number of on-chain applications, including popular decentralized exchanges such as PancakeSwap, SushiSwap, TraderJoe, and Uniswap, also employ LayerZero.
Who invested in LayerZero?
LayerZero Labs, which launched in September 2021 with $6 million in funding, has now secured $120 million in a Series B round, raising its valuation to $3 billion. The blockchain infrastructure provider, which has relayed over two million messages across 30+ chains and secured $7 billion in value, is used by several on-chain apps. The round attracted 33 backers, including Andreessen Horowitz’s crypto division, Christie’s, Sequoia Capital, and Samsung Next. The funding will aid in hiring and expanding into the Asia-Pacific region.
What does LayerZero Labs do?
LayerZero Labs is a Vancouver-based start-up co-founded by Bryan Pellegrino, Ryan Zarick, and Caleb Banister in 2021. The team previously collaborated in computer network research labs at the University of New Hampshire. They developed the LayerZero protocols to facilitate omnichain decentralized applications, enabling them to operate across multiple blockchains.
Disclaimer: Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.
