Hyperlane: What You Need to Know
Interoperability for Modular Blockchains
Recently, we covered Celestia, and the rise of modular blockchains…
Today, we’re briefing you on Hyperlane, a key player on the security side of things, as well as an interoperability facilitator between Celestia and modular L2s.
Over and out ⬇
News:
- Tellor's TRB Token Sees Extreme Volatility: The TRB token from oracle protocol Tellor experienced a dramatic 250% price surge followed by a 70% drop within hours, likely due to overleveraged trading positions.
- Sauber Partners with Stake for F1 Team: Formula 1 team Sauber has inked a two-year title partnership with crypto casino Stake, rebranding to Stake F1 Team Kick Sauber for the upcoming seasons.
- Coinbase and MicroStrategy Stocks Surge: Shares in Coinbase and MicroStrategy have seen significant pre-market gains amid a breakout in bitcoin's price, reflecting growing investor optimism.
- Polymarket Traders Bet on Bitcoin ETF Approval: Traders on the decentralized prediction platform Polymarket are confident that one or more bitcoin ETFs will be approved in the U.S. within two weeks, with an 89% probability.
- Bitcoin ETF Issuers Prepare for Launch: As the SEC nears approval of the first Bitcoin ETFs, issuers like Fidelity and Galaxy/Invesco are detailing their fees and naming authorized participants, setting the stage for a competitive market.
- BlackRock Reveals Authorized Participants for Bitcoin ETF: BlackRock plans to use JPMorgan Securities and Jane Street as authorized participants for its proposed spot bitcoin ETF, pending SEC approval.
- Cryptocurrency Exchange Volume Surpasses $1 Trillion in December 2022: The trading volume on crypto exchanges exceeded $1 trillion for the first time since late 2022, with Binance leading the surge.
- Jim Cramer Endorses Bitcoin's Longevity: CNBC's Jim Cramer acknowledges Bitcoin's "remarkable comeback," suggesting it's a technological marvel that's here to stay.
Project Updates:
- Dymension's Genesis Rolldrop: Over a million addresses can now participate in Dymension’s Genesis Rolldrop, claiming up to 70M DYM, the native asset of Dymension, until January 21, 2024.
- MultiBit Launches Dual-Sided NFT Bridge: MultiBit introduces a groundbreaking bridge allowing users to trade Bitcoin NFTs on Ethereum platforms, with plans to expand support to other networks.
- $WAGMI's 2024 Plans with DWFLabs Collaboration: Daniele announces a collaboration with DWFLabs to enhance $WAGMI's trading experience, aiming for a DEX with the feel of a CEX.
- Jupiter's Upcoming JUP Token Airdrop: The decentralized trading aggregator on Solana, Jupiter, plans to airdrop its JUP token by the end of January, testing the network's capacity and user engagement.
- Tarot Finance Introduces TNX on Fantom Sonic: Tarot Finance announces TNX, an ultra-high performance, fully onchain order book, exclusively on Fantom Sonic, promising a revolution in decentralized trading.
- Sei Network's SEI Token Surges 75%: Driven by the rise of EVM-compliant blockchains and parallelization, Sei Network's SEI token has seen over 75% gains in the past week, indicating growing interest in the network.
- Arbitrum and Optimism Tokens Near Highs: Tokens for Layer 2 solutions Arbitrum and Optimism have seen significant rallies, trading near their all-time highs amid a broader crypto market breakout.
- Orbit Chain Suffers $81.5M Hack: The decentralized finance platform, Orbit Chain, was hacked for $81.5 million in cryptocurrencies, with the stolen funds remaining unmoved as the team works with law enforcement.
Token Unlocks:
- Jan 03, 2024, 05:30 AM UTC - $SUI (Sui): Total - ~$29.23m, 3.14% Cir. Supply.
- Jan 05, 2024, 05:30 AM UTC - $LQTY (Liquity): Total - $986.03k, 0.69% Cir. Supply.
- Jan 05, 2024, 05:30 AM UTC - $GAL (Galxe): Total - ~$6.97m.
- Jan 07, 2024, 05:30 AM UTC - $HFT (Hashflow): Total - ~$6.28m.
- Jan 11, 2024, 05:30 AM UTC - $GLMR (Moonbeam): Total - ~$1.42m, 0.38% Cir. Supply.
Background on Hyperlane
Hyperlane describes itself as the permissionless interoperability layer built for the modular future.
Hyperlane can be used to bridge to chains including Manta, Neutron, Arbitrum, and more.
Security Perspective Of $TIA Token And Two-Way Bridge
$TIA is secured through the Hyperlane network.
The security model decouples the product from securing the connection between chains. Outbound communication from Arbitrum to other chains is also secured.
Once a message is secured, anyone with a Hyperlane mailbox can receive it.
Currently, users can go from Celestia to Arbitrum in one click.
To go back to Celestia, users need to go from Arbitrum to Neutron first and then use IBC transfer over back to Celestia. The app interface abstracts away the need for going from Celestia to Neutron separately. The plan is to make the two-way bridge more seamless in the future.
Security Premise Of Hyperlane
Jkol, contributor at Hyperlane, says that, unlike other interoperability providers, Hyperlane has a distinct security setup.
Security is not tightly coupled with message delivery mechanisms. Hyperlane has a modular security architecture that separates connecting chains from securing those connections.
He adds that Hyperlane focuses on securing outbound communication messages sent from one chain to another.
Messages are broadcasted with added security measures around them.
Any chain with a Hyperlane mailbox can receive these secured messages.
Jkol says that Hyperlane can leverage different forms of security depending on the supported chain’s Validator set.
Chains with their own Validator set provide additional trust assumptions for users when using Hyperlane.
Validator subsets and Staking are also being activated to enhance security. Incorporating tokens into the security of messages allows for additional customization and trust assumptions.
State At The Station Or State Proof
Hyperlane’s security architecture allows for incorporating any mode of state at the station or state-proof.
Different chains can leverage their own assets and validators to secure messages through Hyperlane.
Flexibility in security architecture enables various possibilities for interoperability between chains.
Dynamic Messaging With Hyperlane
Messages can be dynamically routed based on their contents.
Users have the option to choose between a slower but safer ZK option or a faster Validator option.
The choice depends on the size and importance of the transaction.
Aggregating trust through multiple bridges may lead to problems if one bridge acts against user interests. Users have a choice in selecting bridges. Protocols are incentivized through Staking assets to avoid negative outcomes.
Permissionless Interoperability With Hyperlane
Hyperlane aims to be a permissionless option for interoperability.
It is used by other projects like Nexus and Neutron. Integration with Hyperlane helps achieve specific goals in these projects.
Neutron-related project aggregates Hyperlane Validator set along with Axelar and Wormhole. Messages require information from all three sources for processing.
Hyperlane As A Framework For Interoperability
Hyperlane can be used by smaller teams or chains that are not yet well-known or widely adopted.
It allows chains to leverage their own Validator set and choose the level of security they want.
Chains can run their own relay and connect to any other chain that has Hyperlane, ensuring self-sovereignty.
When building a modular Rollup, it is important to consider an interoperability solution alongside the VM and settlement layers.
Hyperlane can serve as the framework for interop in a modular stack, offering seamless integration with other protocols and services.
By choosing Hyperlane, developers have more options and flexibility in creating their desired narrative for their projects.
Discussions about modular chains, permissionless interoperability play a vital role. It is essential to talk about permissionless interop when considering modular chains’ potential. Without permissionless interop, discussions about modular chains would reach a dead end.
Integration Of Hyperlane Into A Chain
There are three main components are needed for integrating Hyperlane into a chain:
Mailbox facilitates sending and receiving messages between chains and can be implemented on various VMs. To integrate Hyperlane, mailbox contracts need to be deployed on the target chain.
Security modules ensure the integrity of messages by validating them using signatures from designated validators. Security modules (ISMs) can be set up easily using authority-based configurations that validate messages from designated validators.
Relayer is responsible for reading mailboxes and processing messages based on their validity. It also handles additional logic if required. Relayers need to be able to read mailboxes between chains and process messages based on their validity. A company called Kurtosis offers a hosted environment for running Hyperlane infrastructure.
Canonical Bridges In Rollups
Canonical bridges connect main chains with rollups.
Examples include Arbitrum’s Optimistic Rollup bridge.
These bridges have minimal trust assumptions.
Implementing Hyperlane into modular rollups follows a similar mental model.
Integrating Hyperlane into rollups provides an interrupt layer.
This layer offers a similar level of security as canonical bridges.
The interrupt layer is embedded natively into the Rollup stack, meaning no need to rely on third-party bridge partners.
Some users prefer using canonical bridges for gas tokens; stablecoins and other assets can benefit from Hyperlane’s connectivity between rollups. I
Increasingly, people are using Hyperlane for various assets but still relying on canonical bridges for specific use cases.
Connectivity With Other Chains
Once Hyperlane is integrated, connecting with other chains becomes easy. There is no need to create bidirectional channels for each chain.
The Relayer needs to be aware of the Hyperlane deployments on the desired chains.
Permissionless connectivity is crucial in a rapidly expanding ecosystem of rollups.
Hyperlane is designed to be extensible for future rollups.
It plays a crucial role in connecting various rollups. Avoiding fragmentation is essential as more rollups emerge.
Hyperlane facilitates seamless connections between different Rollup networks.
Hyperlane is similar to IBC, drawing inspiration from it’ some individuals involved in building Hyperlane also contributed to IBC’s development.
Both protocols provide good guarantees but have some differences in design and flexibility.
Hyperlane aims to be more extensible than IBC.
Hyperlane’s Role In Interoperability
Jkol says that Hyperlane is a key player in permissionless interoperability within the modular ecosystem.
He says that Hyperlane has roles in Data Availability, execution, settlement, and permissionless interoperability.
He avoids using the term “stack” to prevent people from thinking that there are separate stacks for Hyperlane and modular components.
Instead, the team views Hyperlane as having sub-layers within each layer of functionality.
More layers will be added to Hyperlane over time, reflecting the evolution and specialization of the industry.
This evolution allows for a clearer understanding and differentiation of each component within Hyperlane.
Seamless Modular Experience
To attract users, it is crucial for the modular experience to be competitive with other long chains like Solana.
A seamless user experience without complications or token compatibility issues is essential.
Investing in technologies or processes that make the modular experience seamless is seen as a multi-billion dollar opportunity.
Achieving this level of seamlessness would make the modular ecosystem more competitive overall.
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