The Road Ahead for Router Protocol

In nearly three years of development, Router Protocol has transformed from a cross-chain liquidity protocol to aspiring with a grander vision of becoming the cross-chain interoperability standard. Our journey began in 2021 with the introduction of one of the world’s first user-centric asset-transfer bridges. Today, Router Protocol stands proudly among the top interoperability protocols globally.

As we look ahead to the next two quarters, we are confident in becoming the preferred and most advanced interoperability solution for both degens and developers. Key events include:

1. Launch of the Router Nitro mainnet
2. Intent adaptors for major dApps and DeFi applications (such as Lido, Uniswap, Aave, etc.)
3. Release of the first-ever gamified testnet that’d offer a real-time simulation of a complete interoperability ecosystem
4. Public mainnet launch of Router Chain

Our vision has stood the test of time, especially with the proliferation of assets across different chains. The advancement of modular blockchains and rollups reinforces the need for better highways in the realm of the blockchain world. We are in the business of roads, concrete, and bitumen. As the infrastructure layer committed to uniting and unifying the fragmented world of web3, our mission remains the same — to connect web3. We began our journey when Ethereum held 96% of the TVL and currently, it only holds 55% of the TVL locked.

Reflecting on the past, we started as a 4-member project and have since expanded into a 50+ member team. Router Protocol’s valuation has surged from a seed round at $3.5 million to trading at $155 million now, reaching a peak of ~$380 million valuation. We’ve successfully closed over 200 partnerships, processed over $1 billion in cross-chain volume, and garnered support from industry giants such as Coinbase Ventures, Wintermute, Polygon, and QCP Capital. With most investor vesting complete, we experience minimal selling pressure, ensuring strong ownership and long-term support.

Having observed that a significant number of hacks in the blockchain industry during 2020–2022 were linked to cross-chain messaging protocols, we resolved to address this challenge by maximizing the decentralization of our solution.

In July 2022, we started the development of Router Chain — a PoS-based blockchain poised to serve as the central nervous system for all inter-blockchain communications. Router Chain is designed to validate, secure, deliver, and transmit messages seamlessly across blockchains, marking a fundamental shift in our approach. This transformation propelled the Router Protocol’s bridge from a proof-of-authority model to a proof-of-stake (PoS) interoperability solution as part of our commitment to decentralizing cross-chain bridging.

Over the past year and a half, we’ve made substantial investments in research and technical talent for the development of this innovative chain, which is now on the brink of launch. This forward-looking initiative reflects our commitment to pushing the boundaries of blockchain technology and establishing a secure and efficient infrastructure for cross-chain interactions.

In the immediate future

• Router Nitro, the world’s most gas-optimized asset bridge, is powered by a reverse-verification flow. The Nitro launch, scheduled for January 2024, is poised to establish unprecedented benchmarks in terms of speed, capital efficiency, and cost-effectiveness for cross-chain asset transfers. Notably, Nitro pioneers a zero-TVL bridging environment, mitigating honeypot risks by eliminating the requirement for liquidity to stay locked in smart contracts.
• Ecosystem DApps: We are closely working with builders in our ecosystem to build DApps on top of the Router. This includes a DApp which facilitates cross-chain lending/borrowing, cross-chain staking, gamified ordinals, and an NFT marketplace.
• Intent-Based Adapters at Scale: We are going big on intents. With the recent release of our cross-chain intent framework (CCIF), users can seamlessly submit ambiguous intents, such as “Stake my USDC.” These intents are then translated into executable cross-chain workflows optimized for unparalleled speed, cost-effectiveness, and reliability. We previously published a demo of a sample intent-based adapter for a liquid staking protocol, and it’s soon set to debut on the mainnet!
• Middleware Contracts: After a year of meticulous development, we are thrilled to announce the live deployment of middleware contracts in a production environment in 2024. Scaling to multiple decentralized applications (DApps), middleware contracts, residing on the bridge brings a unique advantage — enabling cross-chain communication in a single hop instead of the standard two hops. This translates to enhanced transaction speed by reducing hops, a crucial aspect in networking to ensure minimal transaction duration.
• Mandara GT Phase 2, an interactive and gamified testnet on top of Router Chain.
• Audit Reports: In the past six months, Router Chain has undergone rigorous audits by industry-leading auditors, Informal Systems and Oak Security. Every component has withstood thorough scrutiny, and we are now in the final phase of publishing the reports.

Market Opportunity and The Future Beyond the Roadmap

Interoperability in the blockchain space has ushered in an era reminiscent of the interwoven realms in Doctor Strange’s multiverse. Users, the core pillar of this environment, experience seamless movement of assets across chains, unlocking new possibilities akin to traversing different dimensions. Traders capitalize on expanded liquidity pools, navigating various markets with ease, much like explorers navigating distinct universes. Builders leverage interoperability tools as sorcerers wielding the mystic arts, constructing cross-chain applications that bridge the gaps between disparate blockchain realms. Liquidity providers and market makers, akin to cosmic entities, play pivotal roles, ensuring efficient asset flows and fostering vibrant trading environments across the blockchain multiverse.

The advent of numerous Layer 1 (L1) and Layer 2 (L2) solutions, armed with substantial war chests, is poised to catalyze a surge in activity and growth through several incentive mechanisms, reminiscent of the yield farming opportunities during the DeFi era of 2020–21. While cross-chain bridge volumes averaged $200M daily for most of 2023 and achieved a daily peak of $1.23B in May 2023, we anticipate a multifold increase in activity, akin to the DeFi explosion in 2021, propelled by incentive mechanisms from ecosystems. Zooming out, decentralized exchanges (DEXs) currently process a daily volume of $18B or $6.5T annualized, representing only a small fraction of CEX volumes and highlighting the potential for seamless abstraction through interoperability solutions. Ultimately asset-bridges are the only way to achieve CEX-like trading experience in decentralized exchanges.

In our pursuit of interoperability, we are actively working on integrating Bitcoin into our solution later this year, recognizing the need for a more robust interop solution for the most valued blockchain in the universe. Recent events, like Ordinals, demonstrated that communities can creatively rally around products, even those not entirely technically feasible. This underscores a key lesson: building a blockchain is not just about the technology but also about fostering a culture.

Additionally, we proudly announce the successful integration of the Tron blockchain, the largest settlement layer for stablecoins, into our ecosystem. We aim to seamlessly connect Tron to the world of DeFi and other Layer-1s.

We are also closely following Dank Rollups on Ethereum as they will reduce transaction costs on rollups by 90–99% by implementing EIP-4844, or protodanksharding. This could mean the resurgence of the ETH ecosystem after a silent phase over the last quarter. The growth of Solana has positioned it as a leading chain for DePIN, with notable projects like Helium, Hivemapper, and Render choosing to build on it. Recognizing the need for a robust bridging solution for Solana, we aspire to be the best in the near future.

Amid the emergence of new Layer-1s and the evolution of Ethereum and Solana, modularity is gaining prominence. Projects like Celestia, Eigen Layer, and Avail are at the forefront of the modularity narrative. The question arises: can modularity solve what monoliths could not? Perhaps. We’ll witness if it does. Are we prepared and ready to roll out bridges as needed? Absolutely!

Furthermore, the Cosmos ecosystem experiences a vibrant explosion, with projects like Injective, Sei, Neutron, and Dydx taking the forefront. The modularity ethos of Celestia extends into the Cosmos realm with a focus on collaboration among diverse projects. As the Cosmos ecosystem continues to thrive, we stand prepared to facilitate seamless connections somewhere mid-2024.

In the realm of cryptography, innovative protocols are emerging in the ZK and FHE space. Electron Labs and Risc Zero, our partners, are among the trailblazers in this domain. If Central Bank Digital Currencies (CBDCs) become a reality, interoperability for private blockchains will be a significant necessity.

Reiterating our commitment, we firmly believe that the f̶̶u̶̶t̶̶u̶̶r̶̶e̶ present is undeniably multi-chain, and Router’s purpose is to unchain that future. We envision a world where actions and results unfold seamlessly, with all underlying complexities abstracted out, secure, and functioning effortlessly, akin to the simplicity of the TCP/IP.

We invite you to stay connected with us for further updates and join our thriving community across our various social platforms.

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