ZetaChain is scheduled to launch on mainnet in the coming days, aiming to integrate Bitcoin, Ethereum, and other chains.
The ZetaChain mainnet will go live in the next few days, marking the launch of one of the latest cross-chain experiments in cryptocurrency.
The big picture is that ZetaChain integrates with many different types of blockchains, from Bitcoin and Ethereum to chains in the Cosmos ecosystem. This will provide the ability to build applications that natively use the cryptocurrencies held on each chain, essentially unifying all chains into one.
However, there are many risks involved. A similar project called Thorchain uses the same core technology and is limited to exchanges between these chains. But in 2021, the network has been hacked multiple times over several weeks, raising concerns about whether this approach is too ambitious.
“If you’re building a cross-chain, multi-chain app, it’s more complicated than building a single-chain system. This is because each chain has different finality and security models. I think there are more factors to consider,” said ZetaChain core contributor Ankur Nandwani.
ZetaChain growing slowly
Nandwani emphasized that the project plans to expand slowly in response to these concerns. He said the project would limit the amount of value that can be locked in a smart contract, a figure known as TVL, and gradually increase this over time. “We will run the blockchain in the real world to see what happens and how it works, and then slowly, incrementally increase TVL,” he said.
But Nandwani is no stranger to cryptocurrency. He said he co-created the Brave Attention Token project during his 10-year cryptocurrency career, when he was previously a product manager at Coinbase and an advisor at Brave.
In July 2021, Nandwani launched the ZetaChain project. For the past 18-20 months, the project has been running a testnet to prepare for the mainnet, Nandwani said. One of the key challenges during this period has been finding ways to handle chains with different finality times, i.e. the time it takes for a transaction to be considered fully confirmed.
Nandwani explained that ZetaChain solves this problem similarly to cryptocurrency exchanges by varying network deposit confirmation times. Blockchains like Ethereum require more blocks to be confirmed than Bitcoin before a transaction is considered valid.
Import Bitcoin to Another Blockchain
For ZetaChain to work, validators must run light clients or full clients on the blockchains supported by the network to verify transactions on all chains. This is a difficult setup, but if the network can bring together different ecosystems, it paves the way for more interesting use cases, such as stablecoins supported by Bitcoin.
“I think success will look like more use cases for Bitcoin, even if we use it for more than just a store of value,” Nandwani said. “And I don’t think developers are tied to one chain. Instead of having to deploy 10 smart contracts on 10 different chains, you can build whatever chain you want and still have access to the chain you want.”
Nandwani suggested that other use cases could be decentralized exchanges like GMX that use Bitcoin as collateral, or projects like the Curve creation pool that combines Bitcoin with other assets (platforms that have already started working on them).
Ahead of launch, ZetaChain announced plans to integrate with the OKX wallet to enable Bitcoin to be used in decentralized applications. We are also working with decentralized exchange Sushi to introduce Bitcoin to the platform.
In August 2023, ZetaChain raised $27 million in a funding round from Blockchain.com, Human Capital, VY Capital, Sky9 Capital, Jane Street Capital, and others.
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