I said before that "chain abstraction" is the next focus track after modularization. Many people disagree, but if I tell you, without the help of @ParticleNtwrk's behind-the-scenes "chain abstraction" technology, we would not be able to witness BTC layer2 track MerlinChain - TVL of nearly 4 billion US dollars a month is brilliant. Why? Next, let me share my technical understanding:
"Chain abstraction" is another concept derived from account abstraction, with the purpose of improving users' seamless interaction experience between different blockchains. When EVM-Compatible dominated the market, the AA account abstraction had basically met the needs of users. However, with the rise of the BTC layer2 ecosystem and the emergence of many cutting-edge UTXO model chains, a method that can cross EVM chains and non-EVM The "chain abstraction" technology of the chain is crucial.
Take MerlinChain as an example. It is an emerging BTC layer2 chain of EVM-Compatible. It aims to expand the application ecosystem for native assets on BTC layer1 such as BTC and BRC20, ARC20, and BTC420 through the high scalability of layer2. Let these BTC derivative assets get rid of the performance limitations of the main network chain and release greater liquidity and market potential.
Therefore, the main technical threshold of MerlinChain is how to "cross-chain" BTC native assets and other derivative assets inspired by Inscription to the Layer 2 chain and quickly build an "application protocol" ecosystem to provide Inscription assets with A huge liquidity market, thus revitalizing the long-dormant inscription ecology.
To achieve this, it is necessary to be able to seamlessly connect the BTC UTXO chain and the EVM-Compatible chain, involving safe cross-chain BTC assets, seamless ledger migration of BRC20 and other derivative assets, and the second-layer transfer of BTC and other series of assets. Technical issues such as rapid construction of DeFi application environment.
If the normal development process is followed, even if the second-layer chain can be rapidly developed based on the existing mature EVM solution, how to achieve interoperability between the BTC native chain environment and the EVM environment is a big problem. In exchange for interoperability and interoperability between other chains, there can be a "two-way rush" to adapt to each other. However, the BTC chain is very special and can only be compatible and adapted by other chains, even if it has much higher scalability. The EVM chain is no exception. However, the EVM chain itself and the BTC chain are not the same species, and it is impossible to actively cater to the design of the BTC chain.
What to do? Interoperable "connectors" can only be provided by an independent third-party "chain abstraction" platform. We might as well take Particle's technical support for Merlin as an example to do some discussion and explanation. Let’s see how the BTC-Connect specially developed by Particle Network works?
Most EVM-Compatible chains are only compatible with Metamask, and most BTC chain user assets are in wallets such as Unisat and Xverse. Using Unisat to connect to the EVM chain requires a layer of "wallet adaptation" abstract processing.
To put it simply, Unisat and Metamask have different public and private key encryption algorithms and parsing signature particularities. Particle needs to connect the communication and coordination work of both parties:
1. When the user is in When Unisat initiates a transaction, Unist must first send a transaction request to Partcile Chain through Particle's SDK. Particle Chain will first generate an EVM Smart Contract address corresponding to the Unisat address, and then the AA address will initiate a transaction in the EVM environment, and Request MerlinChain's response;
2. When the user connects for the first time, he needs to bridge some of the assets on the BTC chain to the AA address on the Particle chain. This address has the Paymaster payment function and can be executed on your behalf. A series of subsequent interactive operations, such as entrusted transactions, gas payment, multi-signature management, etc.;
3. After Particle completes a series of SDK interoperability basic connections, user transactions are sent to Particle Chain, Particle Chain will verify the execution and coordinate MerlinChain. When Merlin receives a new transaction request, it will directly verify the Bitcoin wallet signature through AA contract analysis and complete the transaction.
After completing the adaptation of the wallet abstraction, Particle also plays a certain role in MerlinChain’s asset migration and processing. For example, when users transfer assets to MerlinChain through Unisat, they will be stored in the assets provided by the Cobo platform. In the custody address, Particle should immediately trigger a response to generate the corresponding Wrap asset, and generate an AA address that can perform multi-signature and entrusted transactions. Particle is equivalent to the only channel for BTC native assets to enter MerlinChain. This means:
1. ParticleChain will precipitate the Wrap version of most of the native assets migrated from the BTC chain. It can be considered that most of MerlinChain’s nearly 4 billion US dollars of TVL assets will be under the jurisdiction of Particle Chain Within the scope, Particle must connect the entire process of Wrap assets such as casting, destruction, and transfer to help MerlinChain have clear asset circulation management capabilities;
2. For ETH and USDT flowing in from other EVM-Compatible environments , USDC and other assets, Particle will also perform corresponding asset circulation accounting management based on its AA account abstraction characteristics to support the subsequent development of various Swap, Staking, Restaking and other related DeFi protocol applications on MerlinChain;
< p>3. The off-chain indexer system corresponding to the inscription assets is also crucial. As the core tool for managing on-chain transaction data, when the inscription assets flow into the second-layer EVM environment of layer 2, the indexer needs to be accurately recorded, tracked, and managed efficiently and effectively. The circulation of assets, especially when reconciling ledger differences between different indexes.
In general, MerlinChain can quickly and methodically absorb nearly 4 billion US dollars of TVL assets, which is similar to the mature "chain abstraction" services such as BTC Connect, AA account abstraction, and Paymaster provided by Particle Network behind the scenes. Direct relationship.
Above
As a potentially explosive track, "Chain Abstraction" has a self-evident value and significance. Some people say, isn’t this a solution for inter-chain interoperability? That's right, but "chain abstraction" communication between chains of different species is not as simple as imagined.
A set of ERC4337 AA account abstraction standards can basically connect the entire EVM chain. Emerging chains such as Sui and Aptos can also complete asset delivery through mapping relationships such as contracts and agency contracts, which is the most troublesome and challenging. The most important thing is how to deal with the abstract relationship with the BTC chain. The development of BTC layer2 requires the continuous support of "chain abstraction" capabilities. The abstraction of wallet incompatibility interaction, the abstraction of indexer collaboration differences, the abstraction of off-chain custody environment and on-chain asset transparency, the abstraction of management between various alienated inscription assets on the chain, etc.
The reason behind the silence of the Inscription track is mostly due to the fact that many technical problems have not yet been solved. When all kinds of micro-innovation assets are blooming, it is now necessary to use abstract methods to unify them into a unified layer 2 chain. , one can imagine how difficult the journey is.
Note: In the final analysis, BTClayer2 is to solve the liquidity problem of BTC series derivative assets. We look forward to @MerlinLayer2 @BSquaredNetwork @ParticleNtwrk and other Builders working here to bring continuous breakthroughs.
JinseFinance
Huang Bo
Bitcoinist