The Edge Podcast - NEAR’s Vision for Chain Abstraction - Revelo Intel

The Edge Podcast – NEAR’s Vision for Chain Abstraction

In this episode of The Edge Podcast, which took place on June 1, 2024, DeFi Dad and Nomatic hosted Kendall to discuss the groundbreaking concept of chain abstraction in the NEAR protocol and how this technology aims to simplify user and developer interactions across multiple blockchain networks, making the DeFi and Web3 experience more seamless and accessible. Read our notes below to learn more.


Exploring Chain Abstraction with Near: Simplifying DeFi and Web3 Experiences

  • Kendall shares his background, explaining how he got into crypto during the 2013 Bitcoin wave and later became involved with Ethereum in 2017. He joined ConsenSys in London and worked on Ethereum developer tools. In 2019, he met Near’s co-founders and was intrigued by their user and developer-focused approach, leading him to join Near and eventually co-found Proximity Labs.
  • Kendall describes Proximity Labs’ role within the Near ecosystem, supporting teams building DeFi applications and tackling challenging, long-term problems that benefit the ecosystem as a whole. This involves close collaboration with entities like the Near Foundation, Pagoda, Aurora, and various ecosystem projects.
  • Kendall says that the aim is to allow users to interact with DeFi and Web3 applications without needing to understand the underlying blockchain. For developers, it means being able to build and serve users across multiple chains without being locked into a single ecosystem.
  • Kendall explains that Near is well-positioned to tackle chain abstraction due to its focus on scalability and sharding. Near’s sharding capabilities allow for high throughput and the ability to segment applications effectively, which is crucial for managing interactions that span multiple blockchains.
  • Kendall outlines how Near’s architecture enables users to have a Near account that controls sub-accounts on various chains, facilitating seamless cross-chain interactions. This orchestration layer leverages Near’s scalable network to handle high volumes of transactions, potentially starting on Near and landing on other chains.
  • The vision for chain abstraction involves simplifying account management, smart contract management, and overall user experience while maintaining high performance and scalability through Near’s sharding and throughput capabilities.

Unlocking the Power of Chain Signatures

  • Kendall explains that sharding divides blockchain data and tasks among validators, reducing the workload each validator has to manage. Unlike Ethereum, where every validator processes all transactions and stores all state data, sharding allows validators to handle only a portion of the data, improving scalability and lowering the cost of running a validator. Near uses a unique approach called “chunks” where validators process different parts of the blockchain in parallel and then combine them into a single block. This approach allows popular applications to have their own dedicated resources, avoiding congestion on the network.
  • Kendall explains that chain signatures allow Near accounts and smart contracts to request the signing of arbitrary data, such as transactions on other blockchains. This is achieved through a multi-party computation (MPC) network that securely signs transactions without any single party having access to the private key. This technology enables users to manage assets across multiple chains using their Near account and allows developers to build applications that can interact with various blockchains.
  • He mentions that chain signatures can enable multi-chain wallets, where users can manage accounts on multiple chains with advanced security features like two-factor authentication or multisig. It also allows developers to create smart contract functionality on blockchains that don’t support it natively, such as Bitcoin. Additionally, this technology can be used to collateralize assets on one chain and borrow on another, among other innovative use cases.
  • Kendall highlights that chain signatures can be combined with existing interoperability protocols like Wormhole, Axelar, and Layer Zero to enhance functionality. This combination can create powerful new applications by leveraging both chain signatures and message-passing layers, enabling seamless cross-chain interactions and expanding the design space for developers.

Chain Abstraction: Bringing Seamless Cross-Chain Interactions to the Near Ecosystem

  • DeFi Dad asks Kendall about the development timeline for chain abstraction and when users can expect to see its benefits. Kendall explains that they aim to have the first version of chain signatures live by June, with some wallet teams ready to provide sneak peeks. 
  • While some benefits of chain abstraction will be available soon, it will likely take until 2025 for these technologies to become pervasive and fully integrated into popular wallets and applications. Early adopters willing to try new wallets can start experiencing these benefits in the next three months.
  • DeFi Dad asks for wallet or DeFi protocol recommendations that will demonstrate chain abstraction. Kendall recommends two wallets:
    • HERE Wallet – A Telegram-based wallet focusing on simplicity, allowing users to sign transactions across multiple chains without managing keys explicitly.
    • Mintbase Wallet – A web wallet using pass keys, offering an extremely simplified onboarding experience and abstracting away seed phrases and payments.
  • DeFi Dad asks how chain abstraction will accrue value to $NEAR. Kendall explains that each chain signature request will count as a Near transaction, directly increasing the number of transactions on the network and thereby accruing value to Near. Additionally, by attracting top developers to build on Near due to its ability to serve users across multiple chains, the ecosystem will grow and strengthen, indirectly benefiting Near and its token.

Driving Growth and Collaboration in the Near Ecosystem

  • DeFi Dad asks Kendall about the state of growth for the Near ecosystem and how it measures growth. Kendall explains that while TVL is still considered, Near also focuses on native stablecoins, user metrics (daily and monthly active users), and the concept of Total Value Secured (TVS), which reflects value controlled by Near but not necessarily on its blockchain. This metric will be crucial for gauging Near’s impact and security needs. Volume and volume per account are also important, with a focus on real, sustained usage rather than temporary spikes.
  • DeFi Dad inquires about specific apps driving growth in the Near ecosystem. Kendall highlights three applications:
    • Sweatcoin – Brought over a hundred million users to crypto, focusing on onboarding them consistently.
    • Kai-Ching – A loyalty program app with millions of users, hiding crypto from the user experience, making it simple and appealing.
    • Here Wallet – A popular Telegram wallet that is set to expand its functionality beyond the Near ecosystem with chain signatures, enabling interactions with multiple blockchains.
  • DeFi Dad mentions a recent announcement about Near’s collaboration with Nethermind and EigenLayer on the fast finality layer. Kendall elaborates that this collaboration aims to solve the problem of finality for L2s by using Near’s Data Availability (DA) to ensure fast and reliable state transitions, allowing for immediate use in cross-chain applications. This involves using Near DA to store state transitions, verified by EigenLayer validators, creating a soft finality proof quickly and providing a reliable backup in case of discrepancies.
  • Kendall says that developers should seriously consider chain abstraction to build applications that can serve multiple chains without being embedded in one ecosystem. Users frustrated with managing multiple chains should look for new wallets in the Near ecosystem or encourage their current wallet providers to integrate with Near’s chain signatures for a seamless experience. The vision is to enable users to interact with multiple chains without needing to know which chain they are using, ensuring a consistent, fast, and cheap experience across all chains.

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Show Information

  • Medium: YouTube (Video)
  • Show: The Edge Podcast
  • Show Title: NEAR’s Vision for Chain Abstraction
  • Show Date: June 1, 2024