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Introduction to the Axelar Network

Let’s take an in-depth look at what Axelar is, how Axelar seeks to bridge blockchain ecosystems, and how Axelar’s core protocols function

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What is Axelar?

Axelar enables cross-chain communication by providing a decentralized network that can be used for cross-chain requests

Axelar’s Core Protocols

The protocol suite of Axelar consists of two core protocols to connect blockchain ecosystems (CGP & CTP)

Network security

Axelar relies on cryptographic and game theoretic protocols, as well as decentralization to keep the network safe

Ecosystem

The Axelar Network Explained

In the following introduction to the Axelar network, we are going to take an in-depth look at what Axelar is, what mission the project seeks to accomplish, and how it seeks to realize its plans from a technological standpoint. This introduction is ideal for those new to Axelar but also for experienced network participants wishing to learn more about the underlying protocol suite Axelar offers.

Over the last years, a multitude of new blockchain systems have started to emerge, which led to the introduction of several new use cases for distributed ledger technologies, such as asset tokenization, decentralized finance (DeFi), Non-Fungible-Tokens (NFTs), decentralized exchanges, and many other distributed applications. Exemplary for this development are major platforms like Ethereum, EOS, Cardano, and many more that are offering development environments with distinct features for different applications specifically tailored to individual use-cases and end-users.

Problem Definition

Defining the problem the ecosystem is confronted with

The features of the aforementioned blockchain systems are usually only accessible within the ecosystem of each platform – namely the holders of the platform’s native token. As a result, a platform’s use cases are not available to the blockchain ecosystem at large but only accessible to the small fraction of the platform’s token holders. This introduces the challenge that developers are not able to easily plug the blockchains or dApps they are creating into existing ecosystems. Developers are therefore confronted with the tradeoff of choosing between the platform most suitable for their needs and the ecosystem users most interested in their application.

No cross-chain communication

Application builders are not able to communicate across multiple blockchain ecosystems which limits the use cases of dApps

Not blockchain agnostic

Developers are not able to offer their dApps to the ecosystem at large but only to the smaller fraction of users of the specific blockchain the dApp is built upon

Limited accessibility

Users are not able to interact with any dApp of their choice on any blockchain directly from their wallet thus limiting their access to the ecosystem

Solving the problem

Bridging Blockchain Ecosystems

To provide a solution to the aforementioned problem, Axelar seeks to bridge blockchain ecosystems which enables decentralized applications to communicate in a frictionless way across different chains. Such a solution would enable developers to build applications that are accessible to users of other blockchain ecosystems and helps to increase the flexibility of developers and end users considerably.

What is the Axelar Network?

Understanding what Axelar is

Axelar enables simple cross-chain communication by providing a decentralized network along with tools, protocols, and APIs that can be utilized for cross-chain requests. Axelar’s protocol suite consists of transfer protocols and cross-border routing to enable communication across blockchains without the need for a shared programming language or custom changes on the chain.

To ensure decentralization, Axelar is powered by a network of independent validators – a participation role which is open to anyone in the ecosystem. The network’s security is increased by utilizing a Byzantine consensus mechanism, cryptography, and different incentives designed to achieve the liveness requirements necessary for cross-chain requests.

Axelar’s Advantages

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The Axelar network offers a range of advantages for different user groups in the blockchain ecosystem. Let’s have a look at each group and how it benefits from the function of enabled cross-chain communication through Axelar:

Axelar’s advantages for developers

dApp builders

Developers can select the blockchain environment most suitable for their specific development needs but can make their applications accessible to to end users of other blockchain ecosystems. As such, Axelar enables Developers to host dApps anywhere while being able to lock, unlock, and transfer assets. Axelar’s CTP API also enables application builders to communicate with applications powered by other chains.

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Axelar’s advantages for crypto users

End users

Instead of having to acquire the native token of a given blockchain ecosystem, end users can interact with applications on external blockchains from within their wallets

Axelar’s advantages for programmers

Blockchain platform builders

Axelar enables blockchain developers to seamlessly plug-in their blockchains to any other blockchain ecosystem. The only requirement for this is to create a threshold account on the blockchain to plug into the Axelar network.

Core Protocols

Axelar’s protocol suite

The protocol suite of Axelar consists of two core protocols that provide the function of connecting blockchain ecosystems and enabling the cross-chain requests of dApps. Let’s have a look at these core protocols in more detail:

CGP

Cross-Chain Gateway Protocol

Axelar’s CGP can be likened to the Internet’s Border Gateway Protocol. It is used to connect autonomous blockchain ecosystems with each other and enables cross-chain routing. With the aid of the Cross-Chain Gateway Protocol, blockchains are no longer required to speak the same programming language. Instead of having to make custom changes on their blockchains, developers can easily plug their chains into the global network that Axelar provides.

CTP

Cross-Chain Transfer Protocol

Analogous to the application-level protocols Hypertext Transfer Protocol and File Transfer, Axelar’s application-level protocol stack CTP sits on top of the routing protocols (such as CGP). Developers can use the Cross-Chain Transfer Protocol to perform cross-chain requests to any blockchain but also to lock, unlock, and transfer assets between addresses on different blockchain platforms.

With this in mind, we can see how the Cross-Chain Gateway Protocol (CGP) connects an unlimited number of autonomous blockchain ecosystems which each other:

Blockchain 1

CGP

Blockchain 2

Similarly, the Cross-Chain Transfer Protocol (CTP) can be used by developers to perform cross-chain requests:

Developer Blockchain 1

Request

CTP

Blockchain 2

CTP can also be used by developers to execute cross-chain application triggers. This is for instance the case when if dApp 1 on chain A updates its state if dApp 2 on chain B meets a specific criteria (example: interest rate < x%). Similarly, developers can utilize CTP to perform cross-chain requests between apps located on different chains. An example for this would be that a smart contract on chain A can update the smart contract on chain B.

End users can use CTP to access and interact with the application of their choice on any chain via simple API calls (analogous to HTTP GET/POST requests).

In short, CTP enables the composability of programs across blockchain platforms.

Cross-Chain Communication

Scalable communication across different blockchains

The Axelar protocol suite enables heterogeneous networks to communicate with each other by using the same language. To accomplish this, the Axelar network provides the following properties which enable scalable cross-chain communication:

“Plug-and-play” integration

Currently, heavy engineering and integration Burke is required to enable the cross-chain communication between platforms. Instead of having to speak a “custom language,” Axelar enables blockchain ecosystems to seamlessly plug in existing or new blockchains.

Cross-chain routing

The Axelar network will facilitate cross-chain discovery of network addresses and applications as well as it will enable routing across chains. As such, Axelar’s protocols will function similarly to the core protocols of the Internet that provide functions like discovering network addresses as well as routing paths.

Upgradability support

Blockchain ecosystems change dynamically. This is reflected in the Axelar network which minimizes the effort to support updates in a blockchain. In doing so, Axelar makes sure that the interoperability between chains is not affected. There is no need to rewrite “state transition logic” ensuring that applications to not break.

Uniform language for applications

With the Axlear network, developers are given a simple protocol allowing them to lock and unlock assets, to transfer these, and to communicate with other applications independently of the blockchain the tokens/applications are located on. As such, Axelar is chain-agnostic and supports simple calls. In the future, applications will be able to avoid having to rewrite their software stacks by using other networks that join the lower-level routing protocols.

Axelar Network

Synopsis of what Axelar is

The Axelar network enables developers to seamlessly add the cross-chain communication function to their blockchain. It also provides a simple protocol and API that application builders can use to access a variety of different blockchain ecosystems.

Elements of Axelar

Axelar is composed of a decentralized, open network as well as a protocol suite with APIs on top. The decentralized network enables blockchains to bridge non-native ecosystems with a different programming language. The protocol suite with its APIs enable applications to utilize cross-chain requests.

Decentralized network

An open network that anyone can join to become a validator without centralized agents

Protocol suite + APIs

Various protocols such as the Cross-Chain Gateway Protocol (CGP) and the Cross-Chain Transfer Protocol (CTP)

With the help of the Axelar network, existing blockchains such as Bitcoin, Ethereum, and Cardano can communicate with each other and connect to other chains and interoperability hubs such as Cosmos, Avalanche, and Polkadot.

One major advantage that Axelar offers to application developers is that they are in able to build their dApps in a seamless manner using universal APIs and protocols without having to roll out proprietary cross-chain protocols or updating their applications as changes on the blockchains are made.

A core component of Axelar’s decentralized protocols are validators. Let’s have a look at what validators are and what role they fulfill in the network.

Validators

By running nodes that secure the Axelar blockchain, validators collectively help to maintain the network. The users of Axelar are able to elect validators through a delegation process. Based on the stake dedicated to them, validators received a pro-rata voting power. The main objective of validators lies in reaching consensus on the state of the various blockchains Axelar is connected to.

Blockchain

The purpose behind the blockchain is to maintain and run the cross-chain routing and transfer protocols of Axelar. The underlying consensus mechanism follows a Delegated Proof-of-Stake (DPoS) model. Validators in the network can participate in the consensus by bonding their stake and maintaining a high-quality validation service. With the DPoS model, Axelar can provide robust incentives guaranteeing that validators are responsible for maintaining the network’s bridges and threshold schemes. In order to verify the state of connected blockchains, validators run the client software of of other blockchains. In doing so, validators report the state of these chains which is then recorded on Axelar once a threshold is reached.

Governance

Network participants are enabled to act protocol decisions through a governance process. As such, participants will be able to decide which blockchains should be bridged and which assets to support.

Summary

The Axelar network enables dApp builders, blockchain developers, and end-users to access non-native blockchains through its cross-chain communication protocols and to initiate cross-chain requests. The network is secured by validators which enabled a Delegated Proof-of-Stake consensus mechanism.

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