What is an omn-ichain interoperability protocol LayerZero？

LayerZero is the first omnichain interoperability protocol. It enables messages to be sent on different blockchains including concatenating assets, messages, data and contracts. This breaks the isolation of blockchains from each other.

LayerZero provides a powerful underlying communication network structure on which to build a variety of cross-chain application sets. With LayerZero, developers can implement seamless cross chain applications, such as cross-chain DEX or multi-chain revenue aggregators, without having to rely on intermediary transactions.

LayerZero enables direct communication between any blockchain.

LayerZero’s earliest protocols supported seven EVM-compatible public chains including Ethereum, Arbitrum, Avalanche, BSC, Fantom, Optimism, and Polygon. The team also plans to incorporate non-EVM chains such as Cosmos Hub, Terra and Cronos into the roadmap.

The latest L1 public chain project, Aptos, has also integrated the interoperability protocol LayerZero. The Aptos ecosystem will use LayerZero to unlock cross-chain opportunities. LayerZero will enable the Aptos team to provide critical infrastructure, applications, and advanced tools for the entire Move ecosystem and beyond.

LayerZero also launched Aptos Bridge, which allows users to transfer USDC, USDT, and ETH from Ethereum, Arbitrum, Optimism, Avalanche, Polygon, and BNB Chain to Aptos.

LayerZero is a cross-chain infrastructure that enables inter-chain communication through a set of smart contracts deployed on each chain.Here’s how it works: LayerZero is a user application (UA) configurable on-chain Endpoint running an ULN (Ultra Light Node).LayerZero deploys a terminal on each chain (which can be thought of as a series of LayerZero smart contracts). LayerZero relies on Oracle and Relayerto transmit messages between endpoints on the chain.

The exact operation of LayerZero is shown in the figure. When UA sends message from chain A to chain B, the message is sent through a terminal on chain A. The terminal notifies the Oracle and relayer specified by UA of the message and notifies its destination chain.

Purple part of the figure, the Communicator/Validator/Network, is the core component LayerZero terminal, its function is to inform the Oracle and Relayer for specific information, and receive messages from them.

Steps 1 to 5 represent that when transaction event occurs on chain A, LayerZero’s terminal notifies Oracle and Relaye to obtain corresponding information from Chain A respectively. Steps 6 to 7 indicate that Oracle obtains block header from chain A and Relayer obtains transaction proof from chain A respectively.

In steps 8 to 11, Oracle and Relayer will respectively send the obtained information to the LayerZero terminal on chain B. Oracle forwards the block header to the terminal on chain B, and Relayer submits proof of transaction(To explain, since a block may contain multiple transaction events, Relayer’s transaction information is sent one step ahead of Oracle’s. After receiving the block header from Oracle, the terminal deployed in chain B sends the block header hash value to Relayer，which then packages the proof of all transaction events that match the block size to Chain B.）

Then, in steps 12 to 13, the terminal on the target chain completes the verification and forwards the message to the target address.

In short, LayerZero deploys a set of smart contracts on each supported network, and users interact with contracts on each chain through LayerZero contracts.

LayerZero’s most important advantages are: 1. Layerzero is designed to deliver lightweight messages across chains, reducing cross-chain steps and overhead;

2. An omnichain protocol, independent of intermediate chain or intermediate token, can open up all chains and provide direct communication for various types of public chains.

LayerZero’s unique feature compared to other cross-chain Bridges is the ability to directly trade native assets across different chains. Existing cross-chain requires some intermediate medium to complete, but LayerZero can realize effective cross-chain direct communication, without intermediate coins and intermediate chain.

The LayerZero terminal design can be easily extended to support any chain. In addition, the terminals are designed to be lightweight enough to run on expensive Layer1, such as Ethereum, without incurring prohibitive costs.

Why we need Zero?

As the demand for Dapps increases and more capital flows into the space to support development, we are beginning to see the growing pains of layer 1 networks as they struggle to meet the needs of developers and end users who have opposing views on whether dapps should prioritize scalability, security or decentralization.

Layer 1 networks are built with a monolithic architecture. This means that the execution, consensus and data availability layers are all functioning within a single blockchain network. This stacked design places a strain on the system and results in the need for blockchains to comprise decentralization for security, or scalability for decentralization.

Why are Layer 0s Necessary?

Layer 0 networks solve 3 critical problems for web3 development and adoption: Scalability, flexibility and interoperability.

Blockchain scalability is the ability of the network to support the increased load of transactions and nodes in a particular network. In the blockchain, transactions per second are recorded. Day by day, we are witnessing new advancements in blockchain technology; With these advancements, transactions are also increasing per second. That’s why it is called blockchain scalability.

Security is the main feature of a blockchain network besides the distribution of power. Blockchain protocols are made to secure data from network attacks. Scalability in blockchain supports future growth and high transactional throughput. It made many technological advancements to the blockchain to compete with centralized platforms, legacy, and so on. Scalability is a solution to many of the problems that blockchain faces.

Layer-0 vs. layer-1 blockchain solutions

While both types of blockchain solutions have their own set of advantages, it is important to understand how the crypto space can increase mainstream crypto adoption by facilitating faster transactions between the entire ecosystem of blockchain protocols.

This is where layer-0 blockchain solutions can prove very important as they can seamlessly work with existing layer-1 blockchain protocols while providing developers with a higher degree of flexibility in making design decisions. Offering the ability to broaden the number of use cases by creating custom para-chains, layer-0 blockchain solutions can considerably improve scalability without sacrificing decentralization or needing long development cycles. Platforms like Substrate are providing developers with a blockchain framework that empowers them to create their custom blockchains that can exist independently as “solo chains” too.

As more layer-0 blockchain protocols and blockchain SDKs like Substrate are introduced, the overall Web3 vision of creating a connected digital infrastructure for the world to transact in is getting closer to reality.

Blockchain technology is complex to understand but with a little effort, one can realize its usefulness and applications. Rapid developments are taking place in this domain of technology. Several governments and organisations are paying attention to blockchain and are implementing the same in various areas. At this point, it becomes necessary for everyone to understand blockchain as it can very well define the future of technology and data management.