The biggest news we have to share during this update would be this tweet and blog post:
We are building cBridge 2.0 and will be launching the first phase in October. If you have not read this blog post yet, I do suggest giving it a go. cBridge 2.0 is different compared to all bridging designs in this space. cBridge is the only bridge on the market that is designed with two models for LPs (liquidity pools). LPs can run in a full non-custodial model or delegate their liquidity to Celer’s State Guardian Network (SGN). We will let the LPs choose whichever way they like to get involved with their assets. The onboarding of LP’s will be so much simpler compared to other existing bridging solutions and the user experience will also be much smoother.
Now, for SGN stakers and validators, a very big difference is the value capture. For many bridging solutions out there, the protocol token is not essential in the operation of the bridge, but more as a governance token. This creates a lot of issues for value capture because, in a way, these tokens are not really doing anything actively to support the entire system. Why are they entitled to receive value from the network? But for cBridge, it is quite different. Because CELR tokens are actively required to be staked in the network to ensure the smooth operations and security of the State Guardian Network (SGN), which is the core of the entire cBridge 2.0 architecture.
So, it is pretty straightforward for users of cBrdige 2.0 to pay SGN service fees in return, and more people using the bridges means more fees to SGN. You will need to stake CELR tokens to participate in SGN active services or to run a node yourself. In a way, it is no different than any blockchain today like Avalanche, Matic, or others, that the stakers also receive network transaction fees. But cBridge 2.0 is the first one that uses this model in blockchain bridging and interoperability design. This feels like a major differentiator on the economics construct side of things, along with all the other differentiators and advantages on the technical side.
Now, this all sounds awesome, so where are we actually on the cBridge 2.0 update? As of today, the system functionalities are all complete for the “SGN as a shared liquidity pool manager” model and we have started internal security reviews and QA testing. Concurrently we have hired not one, not three, but three independent auditing firms, Slow Mist, Peckshiled, and Certik, to audit the smart contracts and do whitebox pentesting for the system. The auditing, internal review, and testing process are expected to complete by the end of October. Does that mean there is nothing new in October?
Auditing and testing do not block user feedback and user experience testing. So we plan to launch a testnet for our community to experience the cBridge 2.0 system during the week of October 18th.
After all the auditing and testing is done, we will launch a $1M bounty for the community to show our upfront commitment to the security of the system. In the meantime, we will move to mainnet alpha for cBridge 2.0 and slowly increase the capacity of the system to full capacity! Do know cBridge 1.0 is also doing great. If you guys haven’t used it yet, definitely check out the stats page https://cbridge.celer.network/#/analytics approaching $270M and we wonder when it will break $300M (currently close to $500M). With cBridge 2.0 we expect the volume to increase at an even faster pace!
Now, for layer2.finance, the strategy auditing has been completed and we are in theory ready to make that upgrade. However, at this moment, with such great traction for cBridge, we are laser-focused to deliver 2.0 and will come back to layer2.finance once we reach that milestone!
The reward will be the token bridged, so it can be USDT, USDC, ETH, or anything that cBridge supports in the future.
If you are a delegator/validator in SGN, there is no need for you to inject other tokens and currencies to receive the reward.
We may initiate a proposal to increase block reward in the short period to boost the CELR staked in the system so that the system can sustain a higher scale, but that’s really something to be discussed and voted on by the community.
There is no minimal or maximal so there is no ending stake prematurely, but all these are governance parameters that can be later changed.
Saw that, loved it, will be live with cBridge 2.0!
So one analogy we would like to use is that cBridge is like a railway network in the gold rush age. There are various kinds of goldmines here and there. And people never even talk about it, but everyone uses the railway system to get there. Similarly, there are a lot of “hidden giants”, such as network infrastructure providers. I bet you don’t know who is providing the cross-continent fiber connection these days, but we all, like every single one of us, use their services every day. This is how we see cBridge. It is a foundational infrastructure for the multi-chain world.
Our goal is to make it so simple to integrate with multi-chain apps, to a point that users don’t even realize the existence of cBridge but still use it every day and of course, benefit from the Celer core technology ecosystem.
Now, layer2.finance is kind of different in that it is a ride-sharing service for DeFi. That’s much more customer-facing and helps end-users. So I would say that it really depends on the manifestation of the core technology. Hope the analogy makes sense!
So layer2.finance is the ride sharing services for DeFi basically, but right now it operates in one “city” (chain). When cBridge 2.0 is mature enough, these two core components of Celer’s ecosystem can be merged together and make the ride-share service a “multi-city” service.
It’s not really that complicated, we are just doing some prioritization. Which one would guys like to support first?
Result from the vote during this AMA: Solana!
Yes, cBridge 2.0 will have both farming and transaction fees.
There are two lines of bridges in space.
1. Non-custodial bridge where LPs (liquidity providers) manage their own funds and run a node.
2. LPs delegate their funds to “something” and that “something” is supposedly secure enough to manage LP liquidity for them.
Celer cBridge 2.0 is the ONLY bridging solution that offers both modes at the same time, AND, it is better compared to other bridge solutions on EACH operating mode.How?
Let’s talk about the non-custodial model here first. So for a non-custodial model, someone mentioned NXTP and there is another one, Hop. NXTP requires a sealed-bid auction process to happen before every user transaction request. This sealed bid auction process is slow, can have nodes that are not responding or can even have nodes that are colluding together. There are various economic issues that are open to be solved. In addition, there is a big problem called “griefing” to which NXTP offers no solution. Griefing basically means that when some bridge node agrees to transfer tokens for you but then suddenly disappears offline. Your fund is safe, sure, but your fund will be stuck in the bridge for quite some time. I want to transparently acknowledge that cBridge 1.0 also has this issue, and apologies for that experience.
However, in cBridge 2.0, we don’t use any centralized or complicated communication protocol to coordinate between different non-custodial cBridge nodes. Instead, we use SGN.
When a user request is made, this is the “happy” system flow:
– The user queries the current state of the SGN to get an estimated transaction fee and liquidity availability.
– If the estimation is acceptable, the user sends the first half of the HTLC transfer with the max fee tolerance specified.
– The SGN monitors and picks up the transaction. It assigns one or more registered cBridge nodes to the transaction based on node selection rules. This transaction assignment is written on the SGN chain and also marked on the user’s HTLC transfer.
– The assigned node picks up the assignment and responds by completing the rest of the conditional transfer.
– The SGN continues to monitor and track the transaction and once the transaction is successfully completed, the state related to this transaction is purged from the SGN chain.
So no complicated back and forth auction.
Now, we didn’t stop here, but also introduced the first solution to solve “griefing attack”.
When a cBridge node registers with the SGN, it can put down an “SLA bond” (i.e. a bunch of tokens with value) associated with some SLA promises (e.g. availability, fee level, and liquidity reserve) in a pool contract. If the SGN determines that this node violates the SLA, such as being offline with an assigned transfer, the SGN can slash the bond as compensation to the user for the degraded user experience and liquidity opportunity cost. (remember, no fund loss for users is possible, this is just for “fund getting stuck” cost.)
During the node selection, the value available in the SLA bond is a key factor in how the node is prioritized in the transfer assignment process. Honest and reliable cBridge nodes are heavily incentivized to invest in a reasonable SLA bond to increase their chances of getting selected in the bridging process. On the other hand, less reliable nodes will be driven out of the system or will only be called upon as a last option. Finally, cBridge nodes can only be de-registered with the SGN once there are no pending cross-chain transactions.
With the SLA bond slashing capability powered by the decentralized “SGN gateway,” the node availability challenge, and more generally, the SLA assurance concerns, are solved. This is aimed to facilitate a healthy, fast-growing, and decentralized cBridge node operator network for liquidity providers who want to maintain their self-custodial liquidity.
We want to highlight that the SLA bond is not the full liquidity, but only needs to be a very tiny portion of the total liquidity in order to become highly efficient in ensuring a smooth user experience and a self-healing cBridge node operator ecosystem.
Now moving on to the delegated liquidity model, CBridge 2.0 is the only solution out there that does not use a complicated AMM structure for LPs to manage liquidity. And without any additional construct, natively support PoS based weighted signature to increase the security of the protocol alongside the network value. cBridge 2.0 also uses a very flexible pricing mechanism to capture the inherent difference between chain migrations that is also not available in any other solutions.
Now that I am typing some of the blog sections posted here, I suggest giving a read of the blog!
Only after the launch, we can tell, it depends on the volume and on the amount of CELR staked. We can make a model for sure, but the numbers are going to be assumptions.
I want to mention that layer2.finance and cBridge are both core technologies of Celer Network that are directly contributing to the network growth and SGN usage. They are a bit different from CelerX, which is a more standalone ecosystem gaming platform utilizing Celer’s state channel technology. cBridge itself will become a key piece to be composed by many other applications as you can already see in some of our recent partnership announcements. So will layer2.finance.
We are optimizing the gas fee consumption, but for the staking and unstaking operation, you may still need ETH to pay for the gas fee.
So we will have an upgrade for SGN after cBridge 2.0 launch. This upgrade is likely to involve re-staking. We will cover the gas costs for everyone involved for sure.
I will be sure to relay your kind words to our design team.
It will be launched together with cbridge 2.0.
We welcome all stakers in the network and so far as we know, they have been quite reliable for other networks. However, always DYOR and choose your delegating nodes wisely.
There were some mentions of visa building a payment network. To be honest, I am not sure what exactly would be the detail there and history has taught us again and again, incumbents tend to stay as incumbents and do not disrupt their own legacy business.
This is essentially how generations of companies are born and die.
We are actively searching for the right people. However, as you can see, our community team is expanding quickly and they are doing an awesome job!
I should talk to Chandler about this.
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