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An Introduction to the Axelar Network

Axelar-TechStack-DiagramDiagram of the Axelar technology stack: a set of developer tools and APIs atop a decentralized network providing universal routing, translation and security between any two blockchains.

Introduction and Context

Web3 is in its infancy, despite massive growth in demand and usage. Novel consensus mechanisms and smart contract languages are supporting new decentralized applications that aim to serve the next billion people. Today, there exists strong and rapidly growing demand for cross-chain services between these innovative ecosystems.

L1 blockchains provide quite robust security guarantees, which are not conveyed by the much weaker security guarantees of the existing cross-chain infrastructure — one-to-one bridges that are often just multisigs between friends. There’s a serious scaling issue here: bilateral bridges between N networks will require N² bridges. A universal network is needed, handling routing, translation and security on an any-to-any basis between connected blockchains.

Contrast this with the current state of Web2. When we use an application like Zoom, we have to consider issues like participant count, buffering, screen sharing, etc. We do not have to think about the underlying networking involved. With call participants potentially spread around the world, there are many distinct networks that connect to enable us to communicate. Internet protocols like BGP link those networks to exchange data and overlay networks like content delivery networks (CDNs) provide the smooth experiences we expect. These protocols and service layers enable interoperability across networks, which is fundamental to the Web2 applications we use.

A Web3 overlay network, providing universal routing, translation and security, is necessary for Web3 applications to be as scalable and seamless as Web2 applications are today.

What is the Axelar network?

Axelar is the universal overlay network, securely connecting all blockchain ecosystems, applications, assets and users to deliver Web3 interoperability. Axelar is composed of a decentralized network of validators, secure gateway contracts, uniform translation, routing architecture, and a suite of software development kits (SDKs) and application programming interfaces (APIs) to enable composability between blockchains. This allows developers to build on the best platform for their use case, while being able to access users, assets and applications in every other ecosystem. Instead of pairwise cross-chain bridges, they can rely on a network architecture that provides a uniform code base and governance structure.

Axelar’s ultimate goal is to build the underlying infrastructure for onboarding the next billion people onto Web3. In order to achieve this goal, Axelar will:

  1. Make it easy for blockchain developers to plug in and communicate with other chains.
  2. Provide decentralized application (dApp) developers with cross-chain composability.
  3. Allow users to interact seamlessly with applications across multiple ecosystems.

The Axelar SDKs provide a rich suite for developing Web3 applications, ensuring that developers have the tools they need for building. With these tools and APIs, developers can use the Axelar network and its SDKs to write dApps that can be easily deployed across all Axelar-connected ecosystems. In other words, Axelar distills cross-chain interoperability down to a simple set of API requests. This is absolutely central to adoption, as the developer experience around deploying Web3 applications must be like the experience today for Web2 developers, where the underlying networking and ecosystem-specific deployment considerations are largely abstracted away.

How does it work?

The Axelar network has three key components across two functional layers.

A decentralized network

The first is the decentralized network itself, supported by a set of validators that are responsible for maintaining the network and executing transactions. The validators run the cross-chain gateway protocol, which is a multi-party cryptography overlay that sits on top of Layer 1 blockchains. They are responsible for performing read and write operations to gateway smart contracts deployed on connected external chains, voting and attesting to events on those chains.

Gateway smart contracts

The second are the gateways — smart contracts that provide the connectivity between the Axelar network and its interconnected Layer 1 blockchains. Validators monitor gateways for incoming transactions, which the validators READ. They then come to consensus on the validity of that transaction; once agreed, they WRITE to the destination chain’s gateway to execute the cross-chain transaction. The validators and gateways compose the core infrastructure layer.

Developer tools

Sitting on top of the validators and gateways are the APIs and SDKs (the libraries and tools that enable developers to access the Axelar network easily). This is the application-development layer that developers will use to compose across any two chains in a single hop, adding universal interoperability to their blockchains and applications. With Axelar, they can lock, unlock and transfer assets between any two addresses on any two blockchain platforms, execute cross-chain application triggers, and more generally handle any cross-chain requests.

How to use Axelar?

The Axelar Network has four main interaction points.

The first is the SDK described above, which developers will use to integrate their Web3 applications. To learn more about the Axelar SDK, please take a look at our developer documentation and join our Discord.

The second is to run a node or validator, participating in the core underlying processes that secure the network, and validating cross-chain transactions. Validator setup documentation can be found here.

The third is to lead or support the integration of a new blockchain with the Axelar Network. With each new blockchain that connects to the Axelar network, the potential value that Axelar can provide to developers and end-users grows exponentially. At the time of this writing, adding new blockchains is not openly available as a function for Axelar network users. However, this testnet demo shows the simplicity and developer-friendliness of the process, which can be completed in under 10 minutes.

The fourth is to use Axelar’s newly launched, decentralized cross-chain asset transfer application, Satellite. At the time of writing, Satellite supports transferring native Terra assets like Luna and UST between a set of both Ethereum Virtual Machine (EVM) and non-EVM blockchains: Avalanche, Ethereum, Fantom, Moonbeam, Polygon and Terra. Support for other networks and assets will roll out over the coming weeks and months. Satellite demonstrates the potential seamlessness to the end-user: users may exchange assets across previously siloed ecosystems, without any change in user interface.

 

A screen shot of a cross-chain transfer on the Satellite app demonstrates Axelar’s universal interoperability capability.
Cross-chain transfer on the Satellite app demonstrates Axelar’s universal interoperability capability.

Looking to the Future

Over the last 20 years, we’ve seen the internet evolve into what it is today, with Web2 applications able to easily scale and serve users a rich, seamless experience. We are now embarking on a new journey. Web3 is in its infancy. It’s critical that developers be free to experiment on innovative programming languages, blockchain architectures and consensus mechanisms — without sacrificing access to users and liquidity.

When it began, Axelar was a bet on a multichain future. Today, that bet has been validated, and the multichain future has become the present day. However, ensuring that a multichain ecosystem can securely scale and support millions of users that transact billions of dollars is a difficult endeavor that requires carefully built architecture. Present-day pairwise solutions are not fit for the task.

Just as Akamai and the CDN created revolutionary opportunities in Web2, Axelar’s universal overlay network will create revolutionary opportunities in Web3, enabling secure and composable interoperability between all blockchain ecosystems. Just as Web2 developers can easily deploy their web applications to serve end-users regardless of what network they’re on, Axelar’s APIs will enable developers to easily deploy Web3 applications across any L1 blockchain, without having to learn the considerations specific to each one.

Axelar is the answer to the growing concern about cross-chain connectivity compromising the security guarantees of L1 blockchains. Axelar is the universal, decentralized transport layer, supported by permissionless validators and powered by Tendermint. It enables cross-chain applications to get away from the insecurity of ad-hoc bridges. As a universal overlay network, Axelar provides routing, translation and security between all blockchains, providing Web3 interoperability with maximum composability and security.