Summary:
Axelar has deployed pools of axlUSDC<>USDC across Polygon, Avalanche, Arbitrum, and Fantom to provide liquidity for cross-chain applications built on top of Axelar’s decentralized cross-chain infrastructure. We intend for this to be the canonical liquidity venue for axlUSDC as we grow our exposure to the Curve ecosystem.
This proposal is seeking the approval of a gauge for this pool in order to incentivize and grow both the USDC and axlUSDC liquidity on Curve.
References/Useful links:
Link to:
Website: https://axelar.network/
Twitter: https://twitter.com/axelarcore
Protocol Description:
Axelar delivers secure cross-chain communication for Web3. Our infrastructure enables dApp users to interact with any asset or application, on any chain, with one click. Axelar goes far beyond sending wrapped assets with General Message Passing, which carries any payload securely cross-chain. Applications can call any function on any connected chain, and deliver a one-click experience for users on any other connected chain. This is a new kind of dApp development that puts users first and lets developers build on the platform best suited to their use case.
axlUSDC is Axelar’s bridged version of Ethereum USDC, for every axlUSDC there is one USDC locked on Ethereum. axlUSDC functions as Axelar’s routing asset across the 30 chains supported by the Axelar Network. This axlUSDC<>USDC pool will power hundreds of cross-chain applications built on top of Axelar’s decentralized cross-chain infrastructure, including native-to-native cross-chain swaps.
Motivation:
Axelar has seeded the initial liquidity for the axlUSDC<>USDC pools on multiple chains and would like to grow the volume and TVL of these pools through the additional incentives offered via bribes. We envisage this to be an attractive offering given the fact that axlUSDC pools are already earning at the time of writing between 10-20% natively. axlUSDC pools on Avalanche and Polygon are consistently one of the pools with the highest volumes in the last 6 months.
Specifications:
Governance:
Axelar is the full-stack decentralized transport layer, governed by permissionless consensus, providing universal composability of programs with any-to-any cross-chain capability. Users access consolidated pools of liquidity, seamlessly. Developers do not need to speak any custom language; they do not need to make any changes to their chains or UIs.
The Axelar Network has three key components across two functional layers.
The first is the actual network itself, composed of 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 a Layer 1 blockchain. They are responsible for performing read-and-write operations to gateway accounts deployed on connected external chains, voting, and attesting to events on those chains.
The second are the gateways, which are effectively smart contracts that provide the connectivity between the Axelar Network and its interconnected external chains. Validators monitor gateways for incoming transactions, which the validators READ. They then come to a consensus on the validity of that transaction and, once agreed, they WRITE to the destination chain’s gateway to execute the cross-chain transaction. The funds are sent to a generated address on the source chain and are locked, and a corresponding asset is minted on the destination chain. The validators and gateways compose the core infrastructure layer.
Sitting on top of the validators and gateways are the APIs that enable developers to access the tools and infrastructure enabled by those validators and gateways. This is the application-development layer that applications will interact with to go cross-chain. It uses the underlying core infrastructure layer to pass customizable, generalized messages across chains. These APIs are how developers can easily 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.
Oracles:
Axelar does not rely on oracles.
Audits:
Axelar network code has been audited 30 times and continues to go through continuous and rigorous audits.
Axelar network and contracts are all open-source. We actively encourage comments and revisions from white-hat hackers. We have an active bug-bounty program on Immunefi for 2.25m that incentivizes submissions.
Centralization vectors:
Axelar is built using the battle-tested proof-of-stake consensus with a diverse and dynamic validator set. Anyone can join, anyone can participate, and anyone can contribute to the security of the network.
Cross-chain functionalities are modularized, allowing customization for maximal scalability, costs, and security optimizations.
Axelar has implemented quadratic voting to continue decentralizing the system while making it harder for validators to accumulate more votes. In sum, the number of votes each validator gets becomes a square root of their stake. A threshold of validators, weighted by the square root of the stakes, then must collectively co-authorize every cross-chain request. As validators accumulate stake, it becomes more difficult for them to accumulate voting power.
All key policies/parameters are customizable on the network via governance protocols.
With Interchain Security available in the Cosmos ecosystem in the coming months, one network can “borrow” the security of other networks. This would allow it to increase the stake used for validation on the network, making any economic attack much more difficult.
Market History:
axlUSDC is Axelar’s bridged version of Ethereum USDC, for every axlUSDC there is one USDC locked on Ethereum. axlUSDC has been active since Feb 2022, with over $65m of TVL. Across all the chains, axlUSDC consistently generates $1-2m of volume per day. As many applications built on top of Axelar are about to go live on mainnet, we expect this volume to increase.
To Summarise:
- Axelar is applying for a gauge to be added to the axlUSDC<>USDC pool on Polygon, Avalanche, Arbitrum, and Fantom
- These will be the canonical pools for axlUSDC
- axlUSDC is the primary routing asset for dApps built on top of Axelar’s decentralized infrastructure.
- axlUSDC is Axelar’s bridged version of Ethereum USDC, for every axlUSDC there is one USDC locked on Ethereum.