LayerZero Labs, Eigen Labs raise the stakes on cross-chain transactions

The team behind Ethereum re-staking protocol EigenLayer and cross-chain messaging protocol LayerZero have introduced a new system to make cross-chain communication more secure.

In a blog post on Oct. 2, LayerZero Labs announced the partnership with Eigen Labs and introduced a framework for “CryptoEconomic Decentralized Verifier Networks” (DVNs).

The system combines technical verification with financial incentives to ensure secure cross-chain messaging.

It solves several issues regarding cross-chain security, such as lack of economic incentives to ensure trust, limited participation in security, and inflexibility in security models.

DVNs leverage cryptoeconomic security, where verifiers stake assets that can be taken away or “slashed” if they act dishonestly or make mistakes.

The system has four primary mechanisms to ensure cross-chain communication security.

Verifiers lock up or stake assets like Ether, or other tokens such as the protocol’s native assets EIGEN or ZRO, as collateral. Messages are then sent and verified across blockchains.

If a discrepancy is found, tokenholders can vote on whether to veto the staked assets. Finally, if malicious behavior is confirmed, the staked assets are taken away or slashed.

The benefits of the system include increased security for cross-chain messaging, financial incentives for honest behavior, inclusion of any network to contribute by staking assets, and flexibility with various verification methods, according to the blog post.

The framework is open source, which allows other teams to launch their own DVNs using their preferred assets to stake. This enables application-specific DVNs with customizable security parameters.

Eigen Labs explained in a blog post that previously, the security of verifying omnichannel messages was solely based on the network’s verification mechanisms. “But now, with Eigenlayer’s re-staking primitive, anyone can stake their assets to provide an extra layer of security,” it added.

Interoperability protocol LayerZero is a marketplace for DVN verifiers, with 35 entities currently participating, including ZK-proof-based teams like Polyhedra, multi-bridge attestations from Hashi, and oracles like Google Cloud, it stated.

LayerZero Labs concluded that, as this framework is adopted, the future of blockchain communication will be “defined by trust, transparency, and accountability, bringing us closer to a world where every message across blockchains is secured by cryptoeconomics.”

EigenLayer currently has $10.8 billion in total value locked; however, according to DefiLlama, that figure has fallen by almost 50% over the past four months.

Source: https://cointelegraph.com/news/layerzero-eigenlayer-raise-stakes-cross-chain-transactions