Web3

Web3, the decentralised vision of the internet, is built on multiple blockchains, each designed to serve specific purposes. For example, Ethereum excels at decentralised finance (DeFi), while Solana powers fast transactions.

However, this specialisation has led to a disjointed ecosystem where users and developers must navigate separate wallets, protocols, and interfaces for each chain. This complexity slows innovation and makes it hard for Web3 to reach its full potential.

Cross-chain interoperability, the ability for different blockchains to communicate with each other, is a necessary solution to this fragmentation. Allowing different blockchains to interact seamlessly simplifies user experiences and unlocks more complex decentralised applications (dApps). An example of a platform addressing this challenge is Agoric. Its Orchestration API allows developers to build applications that interact across multiple blockchains. Through the Inter-Blockchain Communication (IBC) protocol, part of the Cosmos ecosystem, Agoric offers a unique approach to reducing Web3 fragmentation.

While Agoric is not the only player in this space, it offers a compelling case study on how multi-chain solutions can address Web3 fragmentation.

The Fragmentation Problem in Web3

Blockchain fragmentation refers to isolating different blockchains, each with its technology, assets, and protocols. For example, a DeFi user might use Ethereum for lending and Solana for NFTs, each requiring separate wallets, interfaces, and transaction methods. This complicates the user experience and limits liquidity, spreading it thinly across various chains and reducing DeFi platforms' efficiency.

Cross-chain solutions, like Agoric's Orchestration API, offer a streamlined way to address these challenges by enabling blockchains to interact smoothly, allowing assets to move freely between chains. This leads to simpler user experiences and creates a more unified ecosystem. By breaking down the barriers between blockchains, Agoric helps developers build multi-chain applications that can overcome the limitations caused by fragmentation.

Agoric's Orchestration API: Simplifying Multi-Chain Applications

Agoric's Orchestration API solves fragmentation by allowing developers to build applications that work across multiple blockchains. Using the Inter-Blockchain Communication (IBC) protocol, part of the Cosmos ecosystem, Agoric helps chains transfer assets and interact.​

One of Agoric's key strengths is its use of hardened JavaScript for intelligent contracts. By using a programming language familiar to millions of developers, Agoric lowers the barrier to building multi-chain applications. This makes it easier for Web2 developers to transition into Web3 without learning complex blockchain-specific languages​ like Solidity or Rust.

Another feature is Agoric's async/await functionality, which supports long-lived smart contracts. This means that developers can create applications that span multiple blockchains and complete actions asynchronously across several blocks. For example, with Agoric, users can perform cross-chain staking or multi-hop transfers in a single, seamless transaction​.

"We are excited to offer a platform that enables rich, one-click user experiences that unlock new economic opportunities across multiple chains. Currently, in Web3, even simple tasks demand too many actions and too much finicky expertise from users," explains Dean Tribble, CEO of Agoric Systems. "Agoric Orchestration brings unique technology to developers so they can bring their applications into the next generation of Web3."

Practical Applications of Agoric Orchestration

Agoric's Orchestration API can be used in many areas, particularly DeFi, where liquidity fragmentation is a significant issue. By allowing cross-chain communication, Agoric helps the creation of dApps that can aggregate liquidity from multiple blockchains, leading to improved efficiency and reduced costs for users and developers​.

For example, cross-chain staking typically requires multiple steps and interactions with different blockchains. Agoric's Orchestration API can simplify this process into a single transaction, improving user experience.​

John DiBernardi, co-founder of Calypso, highlighted this simplification: "When executing actions across multiple blockchains, Agoric Orchestration is simply unmatched. We've simplified time-intensive and incredibly frustrating DeFi tasks into a one-click experience that both users new to DeFi and seasoned users will greatly appreciate."

By combining cross-chain actions into one cohesive flow, developers can create richer user experiences. As Dean Tribble, CEO of Agoric, explains: "Agoric Orchestration brings unique technology to developers, enabling rich, one-click user experiences that unlock new economic opportunities across multiple chains."

The Role of the BLD Token

While Agoric's Orchestration API simplifies the technical challenges of cross-chain operations, its integration with the BLD token maintains the platform's economic stability. BLD, Agoric's native token, is critical in securing the network through staking and enabling governance decisions. Moreover, within Inter Protocol, which runs on Agoric, BLD supports the collateral management and the stablecoin IST issuance, ensuring liquidity and stability within the ecosystem.

Other Cross-Chain Solutions

While Agoric's Orchestration API is a powerful tool for simplifying cross-chain interactions, it's not the only solution. Other notable players in the space include Axelar and Polkadot. These projects offer their approach to interoperability.

Axelar provides General Message Passing (GMP), which allows decentralised applications to send messages and transfer assets across blockchains. However, Axelar's system can be more complex for developers, requiring them to understand the intricacies of each blockchain.

Polkadot takes a different approach with its relay chain, which facilitates communication between connected blockchains, known as parachains. While Polkadot's model offers a high level of security, it adds complexity for developers who must participate in para-chain auctions

Addressing Key Challenges

While Agoric's solutions to fragmentation offer many benefits, the platform faces several challenges to succeed at scale.

Scalability is one challenge. As more blockchains enter the ecosystem, seamless cross-chain interactions will become increasingly complex. Agoric's infrastructure, focusing on asynchronous execution and multi-block functionality, is designed to handle these challenges but continued development and refinement will be necessary as the ecosystem grows.

Adoption is another challenge. While JavaScript is a popular language, blockchain developers are often accustomed to using specialised languages like Solidity or Rust. Agoric will need to show the advantages of its system to attract both Web2 developers transitioning to Web3 and existing blockchain developers.

Conclusion: The Future of Cross-Chain Interoperability

The future of Web3 depends heavily on interoperability. As more blockchains are developed, ensuring they can smoothly interact and communicate will become critical. Projects like Agoric, Axelar, and Polkadot open the door for a more unified, multi-chain ecosystem by offering tools that break down the barriers between blockchains.

Cross-chain interoperability is still in its early stages. Agoric and other projects will need to address challenges related to scalability and adoption. The future of Web3 lies in breaking down the silos that currently define blockchain technology, and multi-chain solutions like Agoric will be vital to achieving that vision.