Blockchains have come a long way since their inception, but their complexity remains a barrier to mass adoption. Today, the challenge is to simplify the onchain user experience through innovative solutions such as chain abstraction, which promise smoother, more accessible browsing for everyone.

A few years ago, the ability of blockchains to scale without compromising their security was uncertain. However, the advent of layer 2 has led to a situation of abundance where transaction speeds and costs are no longer an issue.

It is now possible to launch applications without worrying about infrastructure constraints. The next challenge is therefore to transform the onchain user experience to make it more accessible.

The multiplication of blockchains adds complexity to an already austere ecosystem. Each chain requires specific tokens for transaction fees and knowledge of bridges to move from one to another.

The number of steps to move from one application to another has increased, creating friction for users. It is therefore crucial to abstract this complexity in order to improve the onchain experience and attract new users.

The concept of chain abstraction encompasses the methods that enable this: creating secure wallets that are compatible with all chains, accessible to everyone in a matter of seconds, and offering the possibility of making payments or using applications without worrying about the sending or receiving chain.

The ideal is to carry out any action with one click and without delay. Several approaches, more or less compatible with each other, are aimed at this objective.

The CAKE (Chain Abstraction Key Elements)

CAKE structure is a working group initiated by Frontier Research, a research collective aiming to bring together all projects related to chain abstraction. This group comprises around forty different players, including Arbitrum, Across, EigenLayer, Flashbots, WalletConnect, and Wintermute.

CAKE is based on the principle that no single project can develop all the elements needed for blockchain abstraction, and it is crucial that all the players can coordinate and adopt common standards.

CAKE is structured in several layers, each grouping different activities. At the top of CAKE is the application layer, which must be the only one visible to the user.

Account management and access: the permission layer

The "Permission Layer" includes the wallets with which users interact. They can offer various account abstraction functionalities, such as the use of biometric data to create an account and log in to it, as well as several options for recovering one's account.

The aim is to simplify the user's life when signing transactions and avoid the cumbersome management of their private key. The SAFE project is currently the biggest player in this category.

However, these wallets encounter the difficulty of being compatible with several chains and ecosystems. To overcome this problem, they can integrate solutions to manage accounts across blockchains.

One such solution is OneBalance, which aims to enable the creation of "credible accounts." Each credible account is similar to a rollup, from which a user can generate accounts on any chain without having to manage private keys.

So, from the user's point of view, they only have a wallet and can carry out transactions on any chain without worrying about having funds on it, since these actions are intents carried out by "solvers" (see below).

‍At the heart of CAKE: intents

CAKE relies on "intents," user-signed transactions that express a result without specifying how to achieve it. Sophisticated intermediaries, called "solvers," then compete to produce this result in a way that is optimal in terms of cost and speed for the user.

For example, a user may sign an intent on a chain X to mine an NFT or interact with an application on a chain Y. A solver performs all the necessary operations with its own funds for the user. The solver is paid by the user only after delivering the expected result, so it is the solver who bears all the risk, not the user.

An interesting aspect of this model is that a transaction does not have to be finalised - i.e. considered irreversible by the entire network - for the solver to accept it.

The idea is that there is no need to wait for the million validators on the Ethereum network to find a consensus for the payment of a coffee. The user and the solver can quickly find a consensus between themselves allowing the user to perform actions with minimal latency from any channel, as proposed by Socket, whose CEO Vaibhav Chellani we interviewed.

The solver itself assesses the potential risks of aborting the transaction and, if it deems them acceptable, accepts it and pre-empts the consensus of the networks involved to deliver the user's intention in a few seconds, or even milliseconds. Once the transaction has been finalised, the solver receives payment from the user.

Of course, solvers take a small margin on each transaction, but free competition between them tends to reduce this margin towards zero. However, it is crucial that intents are designed to prevent the low profitability of solvers from shrinking the market and creating an oligopoly situation.

Players such as Everclearand Khalani are working to reduce barriers to entry for solvers to avoid monopolies. Intent Markets tracks the activity of solvers.

Behind the chain abstraction: the settlement layer

These are the infrastructures that ensure the transfer of value and data. The elements that guarantee the interoperability of blockchains play a crucial role here, as we have analysed here.

Other elements, such as pre-confirmations, enable solvers' operations to be accelerated in complete security. For example, Commit-Boost and Bolt are working on implementing pre-confirmations.

Infinex: the all-in-one platform

‍Infinex takes a slightly different approach to string abstraction. Although some elements of CAKE can be integrated, the project's ambition is to become a platform capable of integrating all onchain applications.

Until now, centralised platforms such as Binance and Coinbase have been the gateways for new waves of users, and most of them stay there, with these platforms gradually evolving into super apps integrating all sorts of features to offer the best user experience in one place.

Infinex thus aims to rival the user experience of these platforms, but in a completely onchain way, allowing users to own their cryptos and access onchain apps in a simple and secure way.

There are several notable elements that lead to chain abstraction:

private key abstraction using passkey, with various account recovery options
full refund of transaction fees (with a daily limit)
integration of applications from various ecosystems (Ethereum and Solana) within the same interface

Infinex is therefore a single interface that the user never needs to leave, representing a space where they can access onchain applications securely and without friction.

This improved user experience does not come without compromises: although you own your cryptos on a decentralised infrastructure, Infinex's interface is centralised and can therefore be censored. Fortunately, users can still recover their funds by interacting directly with the blockchain.

For the moment, the platform is not generating any revenue and is self-financed to the tune of $25 million by its founder Kain, who previously launched Synthetix, one of the first decentralised protocols for derivatives trading. Infinex plans to raise funds by the end of 2024 from venture capital funds, various Decentralised Autonomous Organisations (DAOs) and its community.

The major challenge will be to find a sustainable business model that allows the platform to continue to operate and transaction fees to be free for users. One possibility would be to introduce a margin for each swap made on the interface, as Uniswap Labs does via its interface built on the Uniswap protocol.

The platform is still in the launch phase and offers only limited functionality.

When will string abstraction be available?

Navigating in Web3 as simply as in Web2 is a major challenge. Web3 allows users to own value themselves, whether it's their currency, their assets or their own data. It is therefore crucial that this ownership is guaranteed by maximum security. However, it is difficult to combine a high level of security with a good user experience.

Thankfully, the collective efforts of the various players are constantly improving this experience. It is very likely that within 6 to 12 months, the way we interact onchain will be very different from the current situation.

The adoption of these new solutions will not be immediate, as they will have to prove their security and it takes time to change the habits of current users.

However, these developments will be the key to mass adoption, enabling even simpler and smoother internet browsing than at present, while relying on infrastructures that are more robust, verifiable and resistant to censorship.

‍

This analysis does not constitute investment advice. It has been written without taking into account your personal circumstances, including your financial situation, risk profile and investment objectives.

Before investing in any product, investors should fully understand the risks involved and consult their own legal, tax, financial and accounting advisors.