- Uniswap Labs and Across Protocol have proposed a new Ethereum standard.
- The new standard promises to eliminate the complexities of cross-chain swaps for users.
- Learn about ERC-7683 and its potential benefits.
As the lack of blockchain interoperability continues to pose user experience and functionality hurdles, several projects and teams have thrown their hat in the ring to tackle the problem.
The latest firms to join the fray are Uniswap Labs and Across Protocol. On Monday, May 20, they proposed a new Ethereum standard, ERC-7683, for better cross-chain trade execution using cross-chain intents.
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What is ERC-7683, and how does it help bolster interoperability? To understand it, it is necessary to first understand the concept of intents.
What Are Intents?
Intents refer to a declaration or indication of a network participant’s intention to carry out a specific action. These actions could range from normal transactions to smart contract interactions or even staking operations.
While a typical transaction would tell the blockchain what to do, intents-based execution models let the user describe their desired outcome while the network generates and executes the necessary transactions, fulfilling the intent while abstracting away the complexities, which could include transactions required to achieve the user’s desired outcome.
With more applications pivoting to intents-based execution to leverage the potential user experience benefits, Uniswap and Across Protocol are looking to standardize the use of intents for cross-chain operations.
Cross-Chain Intents Explained
Cross-chain intents also refer to a declaration of a participant’s intention to carry out an action, in this case, a cross-chain transaction.
This intent is broadcast to third parties, which can either be relayers or market makers that compete to execute the order on behalf of the user.
With cross-chain intents, DeFi projects like Uniswap aim to emulate the atomicity and composability obtainable when users operate on a single chain.
Now that we understand cross-chain intents, let’s examine why and how Uniswap and Across Protocol intend to standardize this process.
ERC-7683
On Monday, May 20, Across Protocol explained that when protocols adopt intents-based execution, they typically have to attract and maintain their own relayer ecosystem. However, according to Across, this practice is unsustainable and leads to relayer fragmentation. Enter ERC-7683.
The proposed standard would require all cross-chain intents to follow the same order structure, allowing a shared set of relayers or fillers to fulfill transactions.
What are the benefits of this approach?
Lower Costs and Improved UX
According to Across Protocol, the standard developed with Uniswap offers significant benefits for all stakeholders. These benefits include lower costs for relayers, a wider relayer network for applications, and lower costs and improved UX for users as more relayers lead to greater competition and faster processing times.
Uniswap noted that it intended to adopt ERC-7683 with UniswapX, an open-source protocol introduced in July 2023 for trading across automated market makers (AMM) and other liquidity sources. With UniswapX, the team intends to achieve gas-free cross-chain swaps.
On the Flipside
- ERC-7683 is still in the draft stage, a long way from being implemented as a standard on Ethereum.
- Intents-based execution models introduce centralization risks as relayers often have to be large market players.
Why This Matters
Cross-chain swaps can often be complicated and lengthy. While cross-chain intents promise to abstract away the complexities, relayer fragmentation will likely lead to unreliable and unpredictable user experiences in terms of cost and time. The proposed ERC-7683 standard promises to improve user experiences by allowing for greater consistency in outcomes.
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