The Current State of Layer 2 Bridges

By Dr. Andreas Freund (Co-Chair) connected behalf of the EEA Community Projects L2 Standards Working Group

We unrecorded successful a multi-chain world, with billions of USD successful plus worth locked successful 100+ chains. And the owners of those blockchain assets behave conscionable similar they would with assets successful accepted finance: they are looking for arbitrage opportunities to marque money. However, successful opposition to the satellite of accepted concern wherever assets successful 1 state tin beryllium utilized successful arbitrage plays successful different state without moving assets by utilizing trusted intermediaries, the aforesaid attack did not enactment for blockchains for a agelong clip for 3 reasons:

1. blockchains cannot speech to 1 another,
2. arbitrage plays connected a peculiar blockchain necessitate that each progressive assets are contiguous connected that blockchain due to the fact that of the trustless quality of nationalist blockchains, 
3. and determination was nary equivalent to the trusted intermediary arsenic successful accepted concern betwixt trustless blockchains.

To lick the occupation of superior inefficiency connected blockchains, and marque wealth successful the process, enterprising individuals created blockchain bridges that addressed those 3 challenges and started to nexus the blockchain ecosystem unneurotic – yes, you tin present commercialized bitcoin connected Ethereum. Of course, bridges tin beryllium utilized for different types of functionality too; however, the superior relation is to amended superior efficiency. 

At a precocious level, a blockchain span connects 2 blockchains facilitating secure and verifiable communication betwixt those blockchains done the transportation of accusation and/or assets.

This allows for a multitude of opportunities specified as

• cross-chain transportation of assets,
• new decentralized applications (dApps), and platforms that let users to entree the strengths of assorted blockchains – frankincense enhancing their capabilities,
• and developers from antithetic blockchain ecosystems tin collaborate and physique caller solutions.

There are 2 basal types of bridges:

Trusted Bridges	Trustless Bridges
Depend upon a cardinal entity oregon strategy for their operations.	Operate utilizing decentralized systems specified arsenic astute contracts with embedded algorithms.
Trust assumptions concerning backing custody and span security. Users mostly trust connected the span operator’s reputation.	The information of the span is the aforesaid arsenic that of the underlying blockchain.
Users request to springiness up power of their crypto assets.	Enable users to stay successful power of their funds done astute contracts.

Within some sets of spot assumptions 1 tin separate different, communal types of span designs:

• Lock, mint, and pain token bridges: Instant guaranteed finality arsenic minting assets connected the destination blockchain tin hap whenever required without the anticipation of a failed transaction. Users person a synthetic, often called a wrapped asset, connected the destination blockchain, not the autochthonal asset.
• Liquidity networks with pools of autochthonal assets with unified liquidity: A azygous plus excavation connected 1 blockchain is connected with further plus pools connected different blockchains with shared entree to 1 another’s liquidity. This attack does not alteration instant, guaranteed finality since transactions tin neglect if determination is simply a deficiency of liquidity successful the shared pools.

However, each designs, and nether immoderate spot assumptions, person to code 2 trilemmas that blockchain bridges face.

Bridging Trilemma arsenic posited by Ryan Zarick, Stargate

Bridging protocols whitethorn lone person 2 of the 3 properties below:

• Instant Guaranteed Finality: Guarantee to person assets connected the people blockchain instantly aft transaction execution connected the root blockchain and transaction finality connected the people blockchain.
• Unified Liquidity: Single liquidity excavation for each assets betwixt root and people blockchains.
• Native Assets: Receive people blockchain assets alternatively of assets minted by the span representing the archetypal plus connected the root blockchain.

Interoperability Trilemma arsenic posited by Arjun Bhuptani, Connext

Interoperability protocols whitethorn lone person 2 of the 3 properties below:

• Trustlessness: Same information assurances arsenic the underlying blockchain without caller spot assumptions.
• Extensibility: Ability to link antithetic blockchains.
• Generalizability: Allows for arbitrary information messaging

Besides the trilemmas which tin beryllium addressed with clever design, the biggest situation for blockchain bridges is information arsenic the galore hacks successful 2021 and 2022 person demonstrated; beryllium it the Wormhole, Ronin, Harmony, oregon Nomad incidents. And fundamentally, a span betwixt blockchains is lone arsenic unafraid arsenic the slightest unafraid blockchain utilized successful the (chain of) bridge(s) for an asset. However, this second contented is not a occupation for bridges betwixt Layer 2 platforms that are anchored connected the aforesaid Layer 1 (L1) blockchain arsenic they stock the aforesaid information guarantees from their shared L1 blockchain. 

Until this point, we person not specifically talked astir L2 platforms that are designed to standard L1 blockchains portion inheriting the L1 information guarantees, since L2s are strictly speaking a peculiar benignant of bridge: a autochthonal bridge. There are, however, respective idiosyncrasies of L2 platforms erstwhile creating a span betwixt L2s e.g. optimistic rollups vs. zk-rollups vs Validium rollups vs Volition rollups. These differences marque them peculiar due to the fact that of the quality successful spot assumptions and finality for L2s versus L1s and betwixt antithetic L2s.

The crushed wherefore bridges betwixt L2s are important is the aforesaid arsenic for L1s: L2 assets are looking for superior ratio connected different L2s, arsenic good arsenic portability and different functionalities.

The quality successful autochthonal spot assumptions connected L2 platforms tin beryllium flooded if bridged L2s are, arsenic remarked already, anchored connected the aforesaid L1. And that the span does not necessitate further spot assumptions. However, differences successful L2 transaction finality connected the anchor L1 marque it challenging to span assets betwixt L2s successful a trust-minimized manner. 

Digging a spot deeper into L2 bridges, we spot that L2-to-L2 bridges ideally should fulfill the pursuing criteria:

• Clients indispensable beryllium abstracted distant from each L2 protocol they interface with done an abstraction furniture – loose-coupling paradigm.
• Clients indispensable beryllium capable to verify that the information returned from the abstraction furniture is valid, ideally without changing the spot exemplary beyond the 1 utilized by the targeted L2 protocol.
• No structural/protocol changes are required from the interfacing L2 protocol.
• Third parties indispensable beryllium capable to independently physique an interface to a targeted L2 protocol – ideally a standardized interface.

When looking astatine the existent landscape, 1 sees astir L2 bridges are treating L2s conscionable similar different blockchain. Note that fraud proofs arsenic utilized successful Optimistic rollups, and validity proofs arsenic utilized successful zk-rollups solutions, instrumentality the spot of artifact headers and Merkle proofs arsenic utilized successful “normal” L1-to-L1 bridges.

Below we summarize the existent and precise varied scenery of L2 bridges with a name, little summary, and span plan type:

Bridge Name	Description	Type of Design
Hop Exchange	Rollup-to-rollup wide token bridge. It allows users to nonstop tokens from 1 rollup to different astir instantly without having to hold for the rollup’s situation period. https://hop.exchange/whitepaper.pdf	Liquidity Network (using an Automated Market Maker)
Stargate	Composable autochthonal plus bridge, and dApp built connected LayerZero. DeFi users tin swap autochthonal assets cross-chain connected Stargate wrong a azygous transaction. Applications constitute Stargate to make autochthonal cross-chain transactions astatine the exertion level. These cross-chain swaps are supported by the community-owned Stargate unified liquidity pools. https://www.dropbox.com/s/gf3606jedromp61/Delta-Solving.The.Bridging-Trilemma.pdf?dl=0	Liquidity Network
Synapse Protocol	A token span leveraging a validator betwixt chains and liquidity pools to execute cross-chain and same-chain swaps.	Hybrid (Token Bridge/Liquidity Network)
Across	A cross-chain optimistic span that uses actors called Relayers to fulfill idiosyncratic transportation requests connected the destination chain. Relayers are aboriginal reimbursed by providing impervious of their enactment to an Optimistic Oracle connected Ethereum. The architecture leverages a azygous liquidity excavation connected Ethereum and abstracted deposit/reimburse pools connected destination chains that are rebalanced utilizing canonical bridges.	Liquidity Network
Beamer	Enables users to determination tokens from 1 rollup to another. The idiosyncratic requests a transportation by providing tokens connected the root rollup. Liquidity providers past capable the petition and straight nonstop tokens to the idiosyncratic connected the people rollup. The halfway absorption of the protocol is to beryllium arsenic casual to usage arsenic imaginable for the extremity user. This is achieved by separating 2 antithetic concerns: the work provided to the extremity user, and the reclaiming of funds by the liquidity provider. The work is provided optimistically arsenic soon arsenic the petition arrives. Being refunded connected the root roll-up is secured by its ain mechanics and decoupled from the existent service.	Liquidity Network
Biconomy Hyphen	Multi-chain relayer web utilizing astute contract-based wallets for users to interact with liquidity providers to transportation tokens betwixt antithetic (optimistic) L2 networks.	Liquidity Network
Bungee	The span is built connected the Socket infrastructure and SDK with the Socket Liquidity Layer (SLL) arsenic its main component. The SLL aggregates liquidity crossed aggregate bridges and DEXs and besides allows for P2P settlements. This is antithetic from a Liquidity Pool web since this azygous meta-bridge allows dynamical enactment and routing of funds via the champion span arsenic per a user’s preferences specified arsenic cost, latency, oregon security.	Liquidity Pool Aggregator
Celer cBridge	A decentralized and non-custodial plus span that supports 110+ tokens crossed 30+ blockchains and layer-2 rollups. It is built connected apical of the Celer Inter-chain Message Framework which is built connected the Celer State Guardian Network (SGN). The SGN is simply a Proof-of-Stake (PoS) blockchain built connected Tendermint that serves arsenic the connection router betwixt antithetic blockchains.	Liquidity Network
Connext	Dispatches and handles messages related to sending funds crossed chains. Custodies funds for canonical assets, accelerated liquidity, and unchangeable swaps. The Connext declaration uses the Diamond signifier truthful it comprises a acceptable of Facets that enactment arsenic logical boundaries for groups of functions. Facets stock declaration retention and tin beryllium upgraded separately.	Hybrid (Token Bridge/Liquidity Network)
Elk Finance	Uses ElkNet with features specified as  Cross-chain inferior token for worth transportation ($ELK) Safe and unafraid transfers compared to accepted bridges Cross-chain worth transportation via ElkNet successful seconds betwixt each the blockchains Elk supports Bridging-as-a-Service (BaaS) to supply infrastructure for developers to leverage the ElkNet for customized bridging solutions Cross-chain swaps betwixt each connected blockchains Impermanent Loss Protection (ILP) for our liquidity providers Non-Fungible Tokens (Moose NFTs) with unsocial abilities and features	Hybrid (Token Bridge/Liquidity Network)
LI.FI	A span and DEX aggregator that routes immoderate plus connected immoderate concatenation to the desired plus connected the desired concatenation made disposable connected the API/Contract level done an SDK, oregon arsenic an embeddable widget successful a dApp	Liquidity Pool Aggregator
LayerSwap	Bridge for tokens from a centralized speech relationship straight to a Layer 2 web (both optimistic and zk- rollups) with debased fees.	Liquidity Network (using an Automated Market Maker)
Meson	An atomic swap exertion utilizing Hash Time Lock Contracts (HTLC) utilizing unafraid communications betwixt users combined with a liquidity supplier relayer web for the supported tokens.	Liquidity Network
O3 Swap	The O3 cross-chain mechanisms of Swap and Bridge aggregating aggregate liquidity pools crossed chains let for elemental one-time confirmation transactions with a planned Gas Station solving the state interest request connected each chain.	Liquidity Pool Aggregator
Orbiter	A decentralized cross-rollup span for transferring Ethereum-native assets. The strategy has 2 roles: Sender and Maker. The ‘Maker’ is required to deposit excess borderline to Orbiter’s declaration earlier they tin suffice to beryllium a cross-rollup work supplier to the ‘Sender’. In the accustomed process, the ‘Sender’ sends assets to the ‘Maker’ connected the ‘Source Network’, and the ‘Maker’ sends them backmost to the ‘Sender’ connected the ‘Destination Network’.	Liquidity Network
Poly Network	Allows users to transportation assets betwixt antithetic blockchains utilizing a Lock-Mint swap. It uses a PolyNetwork concatenation to verify and coordinate connection passing betwixt Relayers connected supported chains. Each concatenation has a acceptable of Relayers, portion the PolyNetwork concatenation has a acceptable of Keepers that motion cross-chain messages. Chains integrated with Poly Bridge request to enactment airy lawsuit verification since validation of cross-chain messages includes verifying artifact headers and transactions via Merkle proofs. Some of the astute contracts utilized by the span infrastructure are not verified connected Etherscan.	Token Bridge
Voyager (Router Protocol)	The Router Protocol uses a pathfinder algorithm to find the astir optimal way to determination assets from the root concatenation to the destination concatenation utilizing the Router web which is akin to Cosmos’ IBC.	Liquidity Network
Umbria Network	Umbria has 3 large protocols moving together: A Cross-chain Asset Bridge; enabling the transportation of assets betwixt different incompatible blockchains and cryptocurrency networks. A Staking Pool, wherever users tin gain involvement connected their crypto-assets by providing liquidity to the bridge. Liquidity providers of UMBR gain 60% of each fees generated by the bridge. A Decentralised Exchange (DEX); and automated liquidity protocol powered by a changeless merchandise formula, deployed utilizing astute contracts, governed wholly on-chain. Both protocols enactment successful tandem to supply plus migration betwixt cryptocurrency networks	Liquidity Network (using an Automated Market Maker)
Via Protocol	The protocol is an aggregator of chains, DEXs, and bridges to optimize plus transportation routes. This allows plus bridging successful 3 ways: Make aggregate transactions connected antithetic blockchains Make 1 transaction done decentralized bridges that person integrated DEXs Make 1 transaction done semi-centralized bridges, which volition trigger a 2nd transaction connected the people chain	Hybrid (Token Bridge/Liquidity Network)
Multichain	Multichain is an externally validated bridge. It uses a web of nodes moving SMPC (Secure Multi-Party Computation) protocol. It supports dozens of blockchains and thousands of tokens with some Token Bridge and Liquidity Network.	Hybrid (Token Bridge/Liquidity Network
Orbit Bridge	Orbit Bridge is portion of the Orbit Chain project. It is simply a cross-chain span that allows users to transportation tokens betwixt supported blockchains. Tokens are deposited connected the root concatenation and “representation tokens” are minted connected the destination chain. Deposited tokens are not precisely locked and tin beryllium utilized successful DeFi protocols by Orbit Farm. Accrued involvement is not passed straight to token depositors. Bridge declaration implementation and workplace declaration root codification are not verified connected Etherscan.	Token Bridge
Portal (Wormhole)	Portal Token Bridge is built connected apical of Wormhole, which is simply a message-passing protocol that leverages a specialized web of nodes to execute cross-chain communication.	Token Bridge
Satellite (Axelar)	Satellite is simply a token span powered by the Axelar network	Liquidity Network

The L2Beat task maintains an progressive database of bridges applicable to L2s with the Total-Value-Locked (TVL) successful the span arsenic good arsenic a statement and little hazard assessment, if available.

L2 Bridges Risk Profiles

Lastly, erstwhile users utilize L2 Bridges, successful fact, immoderate bridge, attraction needs to beryllium taken, and the pursuing risks request to beryllium evaluated for a fixed bridge:

Loss of Funds

• Oracles, relayers, oregon validators collude to taxable fraudulent proofs (e,g, artifact hash, artifact header, Merkle proof, Fraud proof, Validity proof) and/or relay fraudulent transfers that are not mitigated
• Validator/Relayer backstage keys are compromised 
• Validators maliciously mint caller tokens
• False claims are not disputed successful clip (optimistic messaging protocols)
• A destination blockchain reorganization occurs aft optimistic oracle/relayer quality clip passes (optimistic messaging protocols).
• Source codification of unverified contracts progressive successful oregon utilized by a protocol contains malicious codification oregon functionality that tin beryllium abused by a declaration owner/administrator
• Token Bridge owners behave maliciously, oregon initiate time-sensitive exigency actions that interaction idiosyncratic funds, and bash not decently pass to the idiosyncratic base
• Protocol contract(s) paused (if functionality exists)
• Protocol contract(s) person a malicious codification update

Freezing of Funds

• Relayers/Liquidity Providers bash not enactment connected idiosyncratic transactions (messages)
• Protocol contract(s) paused (if functionality exists)
• Protocol contract(s) person a malicious codification update
• Insufficient liquidity successful the people token connected the bridge

Censoring Users

• Oracles oregon relayers connected either destination oregon people L2s oregon some neglect to facilitate a transportation (message)
• Protocol contract(s) paused (if functionality exists)

While this database is not exhaustive, it gives a bully overview of the existent risks associated successful utilizing bridges.

There are new developments underway utilizing zero-knowledge-proof (zkp) technologies designed to mitigate immoderate of the supra hazard factors and code the 2 span trilemmas. In particular, the usage of zkps allows for the pursuing span plan characteristics:

• Trustless and Secure due to the fact that the correctness of artifact headers connected the root and people blockchains tin beryllium proven by zk-SNARKs which are verifiable connected EVM-compatible blockchains. Hence, nary outer spot assumptions are required, assuming the root and people blockchains and the utilized light-client protocols are unafraid and we person 1-of-N honorable nodes successful the relay network.
• Permissionless and Decentralized due to the fact that anyone tin articulation the bridges’ relay network, and PoS-style oregon akin validation schemes are not needed 
• Extensible due to the fact that applications tin retrieve zkp-verified artifact headers, and execute application-specific verification and functionality 
• Efficient due to the fact that of new, optimized impervious schemes with abbreviated impervious procreation and accelerated impervious verification times

Albeit early, these types of developments committedness to accelerate the maturation and information of the span ecosystem.

We tin summarize the supra treatment and overview of L2 Bridges arsenic follows:

• L2 Bridges are an important glue of the L2 ecosystem to further L2 interoperability and businesslike usage of assets and applications crossed the ecosystem. 
• L2 bridges utilized connected L2s anchored connected the aforesaid L1, specified arsenic Ethereum Mainnet, are safer than bridges betwixt L1s – assuming the root codification is safe, which is often a large if.
• As with each distributed strategy architectures, determination are important tradeoffs to beryllium made, arsenic expressed successful the 2 posited Trilemmas – Bridging Trilemma and Interoperability Trilemma.
• L2 Bridges person precise antithetic spot assumptions, e.g., trusted vs. trustless bridges, and precise antithetic plan choices, e.g., lock-mint-burn vs. liquidity networks.  
• The L2 Bridges ecosystem is inactive nascent and successful a authorities of flux.
• Users are advised to bash their owed diligence to measure which L2 bridges connection the champion risk-reward illustration for their needs.
• There are caller developments underway utilizing caller zkp-technologies that are efficaciously addressing the 2 span trilemmas, and assistance to summation the information of bridges overall.

While inactive aboriginal successful the travel towards a standardized L2 interoperability framework, these are important developments, and request to beryllium taken earnestly arsenic immoderate 1 of those projects mightiness go “THE” span model – it is not yet VHS vs Betamax, but we are getting there.

The L2 WG would similar to gratefully admit Tas Dienes (Ethereum Foundation), Daniel Goldman (Offchain Labs), Bartek Kiepuszewski (L2Beat) for a cautious speechmaking of the manuscript and invaluable contented suggestions.