WETH

Cross-Chain Bridge Value Increases by 89% in Less Than a Month Surpassing $14 Billion TVL

10/10/2021 by Idelto Editor

23 days ago on September 16, cross-chain bridges held around $7.79 billion total value locked (TVL) and since then the TVL has increased 89% since then to $14.75 billion. Currently, the top bridges include network connections like Polygon Bridges with $4.5 billion, Fantom Anyswap Bridge with $4.1 billion, and the Avalanche Bridge with $3.2 billion.

Cross-Chain Bridge Technology Swells

Decentralized finance (defi) and cross-chain bridge technology have continued to grow in value this year. A cross-chain bridge allows users to connect to another blockchain, which in most cross-chain cases the other network has been the Ethereum chain, and users can swap assets back and forth between each blockchain.

Last month, Bitcoin.com News reported on an in-depth study that covers the myriad of multi-chain bridges that exist today. At that time on September 16, metrics from Dune Analytics’ “Bridge Away (L1 Ethereum)” dashboard indicated that bridges held $7.79 billion total value locked (TVL).

Since then statistics show the TVL has increased by 89% to $14.75 billion in value today. The “Bridge Away” dashboard shows bridges stemming from Harmony, Optics, Boba, Zksync, Near, Solana, Fantom, Polygon, Avalanche, Optimism, Arbitrum, Xdai, Celo, BSC, Moonriver, and RSK.

Polygon Holds Top Position, Loopring Transfers Are the Cheapest

During the last 30 days, the records measured 121,882 unique addresses associated with these different bridges. At the time of writing, Polygon holds the largest TVL capturing $4.5 billion and the Fantom Anyswap Bridge commands $4.1 billion.

Fantom’s bridge is followed by Avalanche, Arbitrum, Optimism, Zksync, Solana, Harmony, Xdai, and Moonriver respectively. Both WETH and ETH have the top spot in terms of asset rankings while the stablecoin USDC runs in the third position.

USDC is followed by WBTC, USDT, MATIC, and DAI as far as asset rankings are concerned. Chainlink (LINK) holds the seventh position among the top assets leveraged on cross-chain bridges. Data from l2fees.info indicates that the current cost to transfer ether via Loopring is $0.17 per transaction. Polygon Hermez is $0.25 per transfer, Zksync $0.26, Optimism $0.97, and Arbitrum One is $1.88 per transfer.

What do you think about the cross-chain bridge technology swelling in value and the transfer fees tied to specific Layer 2 (L2) protocols? Let us know what you think about this subject in the comments section below.

Study Shows Cross-Chain Bridge Technology Growth, Bridges to Ethereum Exceed $7 Billion

16/09/2021 by Idelto Editor

On September 8, 2021, Dmitriy Berenzon, research partner at 1kxnetwork, an early-stage crypto fund that helps founders bootstrap token networks, published a comprehensive research post concerning blockchain bridges. Berenzon’s study highlights the current “multi-chain market structure” and bridges that are making a myriad of blockchains compatible.

Researcher: ‘We Are Finally in a Multi-Chain Market Structure’

For quite some time now, multi-chain or cross-chain technology has been a holy grail of sorts in the cryptocurrency development space. People want to transact with other blockchains by leveraging bridges to different ecosystems.

Dmitriy Berenzon published a detailed article about the subject of cross-chain tech and bridges, and he believes we’ve finally reached a watershed moment. “After years of research & development, we are finally in a multi-chain market structure,” Berenzon stresses in his blog post.

Study Shows Cross-Chain Bridge Technology Growth, Bridges to Ethereum Exceed $7 Billion — Image of bridge technology “as of September 8, 2021; Illustrative / Not fully comprehensive,” according to research partner at 1kxnetwork, Dmitriy Berenzon.

Berenzon’s study looks at blockchains like Ethereum, Solana, Tezos, Avalanche, Polkadot, Binance Smart Chain, Cosmos, and more. The researcher notes that “interoperability unlocks innovation” as he highlights that “bridges are important because they enable users to access new platforms, protocols to interoperate with each other, and developers to collaborate on building new products.”

Moreover, Berenzon lists the many benefits of cross-chain interoperability like leveraging the tech for external validators and federations. Also, using the tech for light clients and relay protocols alongside the ability to access liquidity networks.

However, Berenzon’s report is not just a fluff piece about fintech, and he highlights that cross-chain tech and bridges are an “incredibly difficult problem in distributed systems.” He adds that things like finality and rollbacks need to be addressed, NFT transfers and provenance, alongside stress testing these blockchain bridges over time.

$7.7 Billion Locked Across 8 Bridges to Ethereum

In addition to Berenzon’s insights, statistics from Dune Analytics’ dashboard called “Bridge Away” measure bridge volume tethered to the various chains and Ethereum. In terms of Ethereum bridge relative total value locked (TVL) stats, the Polygon ERC20 Bridge has approximately $2.4 billion in TVL on September 16, 2021.

Polygon’s bridge represents 32.5% of the TVL across eight bridges. The bridges recorded include the Polygon ERC20 Bridge, Arbitrum Bridges, Avalanche Bridge, Solana Wormhole, Fantom Anyswap Bridge, Harmony Bridges, Optimism ERC20 Bridges, and Near Rainbow Bridge.

Across all of these bridges mentioned, there’s $7.79 billion TVL spread across 42,997 unique addresses during the last 30 days. Arbitrum Bridges command 31.5% of the aggregate TVL and the Avalanche Bridge has around 21.2% today.

Solana Wormhole’s TVL is about 6.7% and the Fantom Anyswap Bridge has around 6.6% of the $7.79 billion TVL. Ether and WETH are the top assets held in TVL with $2.9 billion recorded on September 16. USDC is the second leading asset held in bridge TVL with $1.2 billion recorded. This is followed by wrapped bitcoin (WBTC) which has just over a billion dollars held in the overall bridge TVL aggregate total.

What do you think about multi-chain or cross-chain bridge technology and the expanding TVL held by these protocols? Let us know what you think about this subject in the comments section below.

Cream Iron Bank $36M Flash Loan Attack: Markets Re-Enabled While Asset Borrow Is Paused

16/02/2021 by Idelto Editor

Cream Iron Bank Flash Loan Attack: Markets Re-Enabled While Asset Borrow Is Paused

Following the Cream Iron Bank flash loan attack, preliminary findings of a probe have shown that contracts and markets still function normally. As a result, markets have now been re-enabled while the asset borrowing function has been paused. The Cream team also reveals that investigations are continuing.

The Exploit

After the exploit, the value of the Cream protocol token plummeted from just over $280 on February 12 to $186.48 24 hours later. At the time of writing, Messari data shows that the token had recovered although it has remained mostly under $230.

Meanwhile, in his analysis of the exploit, researcher Igor Igamberdiev reveals that the attacker(s) had “used Alpha Homora for borrowing Synthetix stablecoin from Ironbank.” He adds that “each time they (would) borrow twice as much as in the previous one.” The attacker(s), did this through two transactions and whenever they lend the funds back into Ironbank they would receive Yearn Synthetix stablecoin.

According to Igamberdiev, the attacker(s) had at some point secured a 1.8 million USDC flash loan from Aave v2. This flash loan was then swapped with Synthetix stablecoin for onward lending to Ironbank.

Millions Siphoned

Using similar tactics, the attacker(s) would take out an even bigger loan. In his Twitter thread, Igamberdiev explains:

Also, a $10 million flash loan is taken, which is also used to increase the number of Yearn Synthetix stablecoin. In the end, the number of their Yearn Synthetix stablecoin reaches an incredible amount, which allows them to borrow anything from Iron bank.

Consequently, the attackers went on to borrow stablecoins valued at $13.4 million as well as wrapped ETH valued at over $23 million.

At the time of writing, it had been revealed that the debt resulting from the attack “will not be between users and Alpha Homora.” Instead, it will be Alpha Homora and Iron Bank that will have to “find a solution that resolves the debt between the two protocols.”

What do you think needs to be done to prevent future flash loan attacks? You can tell us what you think in the comments section below.

Over 15% of ETH Supply Locked in Smart Contracts, BTC Dominance Declining

17/09/2020 by Idelto Editor

The rapid growth of decentralized finance (defi) protocols is contributing to the increasing proportion of ETH supply that is now locked in smart contracts. More than 15% of the total ETH supply is now locked, compared to 11.5% from a year ago. This growth led to the inevitable decline of BTC dominance.

According to a report, over 5% of ETH is locked up in the WETH (wrapped ether) smart contracts, enabling it to interact with other tokens more easily. Most of this WETH has then been locked up in defi contracts, including Maker, Uniswap, and Balancer.

The report also notes that aside from “defi use cases via WETH, the largest ETH balances in smart contracts are for exchange multisigs.”

While exchange multisigs simply “represent custodial passive holding, the other contracts (WETH, Compound, etc.) are all examples of how ETH is moving beyond the simple ‘store of value’ use case.”

Meanwhile, despite seeing its dominance diminish, BTC still showed “bullish fundamentals, both in terms of on-chain activity and price trends.”

Also, taking note of the interesting similarities between what happened during the 2017 ICO boom and the current defi craze, the report states:

A similar trend played out in the bull run of early 2017, when money flowed into high-yield ICOs at a much faster rate than BTC. However, later in 2017, BTC started to regain dominance as ICO investors took profits and de-risked into a more reputable asset.

While it might seem logical to conclude that investors will move profits from high-yield defi tokens into BTC, the report presents a different possibility:

“Many investors now talk of ‘stacking wei’ as opposed to ‘stacking sats,’ signifying a potential shift in BTC’s status as the default store of value within crypto markets.”

This suggests that BTC’s waning market dominance might be permanent this time around, as far as retail crypto investors are concerned. However, given the growing interest in BTC by institutional investors, the digital currency stands a “better chance of attracting investment from traditional hedge funds than the defi community.”

What do you think of BTC’s declining dominance? Tell us what you think in the comments section below.

The post Over 15% of ETH Supply Locked in Smart Contracts, BTC Dominance Declining appeared first on Bitcoin News.