Multichain Relay Token — Part 2 (Relay Swaps)

This is a continuation of the two-part publication about the cross-chain relay token concept. The focus of this article is to describe how GTON is used as a proxy token when converting between native tokens of different blockchains without using bridges directly.

A token in the middle

In Cross-Chain Relay Token — Part 1 (Wrapped Tokens), the use of GTON as an AMM relay token was considered, which allows one to trade wrapped assets with minimal slippage, provided that the incentives are set up properly, i.e. the users have sufficient motivation to participate in LP farming by putting liquidity into GTON pairs with wrapped tokens, stablecoins, and native tokens.

Mirror Accounts

Most DeFi users have an account on the Ethereum network with some amount of Ethereum on it. Imagine a situation when such a user discovers the Fantom network and becomes interested in trying what it has to offer. Despite the fact that Fantom is an EVM chain, which means that a user can utilize their existing account via Metamask for signing transactions and connect to the Fantom network in one click, one problem remains: while their Fantom balance has no FTM tokens, the user is unable to make transactions.

Relay Token

On each of the integrated blockchains, the GTON token has AMM DEX pools for their native tokens. For providing liquidity to the GTON token in these pools, a reward is paid out (see LP farming). For example, on the Ethereum blockchain, there is a GTON pool to ETH (on Uniswap), on the Solana blockchain, there is a pool to SOL (on Serum), and on Polygon and Fantom, respectively, to MATIC and FTM.

Cross-chain Swap: $ETH -> $SOL (EVM <-> non-EVM)
  1. GTON is immediately locked on smart contracts of the Graviton system (Mirror Account).
  2. The oracles notice this event and signal it to Mirror Account’s smart contracts on the Solana side. There, in turn, an equivalent amount of GTON is unlocked and sold for SOL in an AMM pool on the Solana blockchain.
  3. The purchased native tokens of the Solana blockchain are transferred to the user’s account.
Cross-chain Swap: $BNB -> $MATIC (EVM <-> EVM)
Cross-chain Swap: $TRX -> $SOL (non-EVM <-> non-EVM)

Revenue for GTON holders

As you can see, the proposed system that implements cross-chain swaps without any direct swap transactions can be monetized via the relay token (GTON) itself. For example, a minor fee of around 0.01 GTON plus 0.01% of the transaction amount can be subtracted from every transaction with GTON. The accrued fees will then be sent to the governance stakers of GTON.

Token in the middle …

Part-1: https://alexpupyshev.medium.com/cross-chain-relay-token-b57af4296f89

Tech Ξntrepreneur, Lobster