Everything you need to know about Chain Abstraction

Chain abstraction is transforming how we interact with crypto by making complex multi-chain operations invisible to users. As the crypto ecosystem expands with multiple chains addressing scalability challenges, chain abstraction emerges as the crucial next step in blockchain evolution. This comprehensive guide explores how chain abstraction developed, why it's essential for mainstream crypto adoption, and how different projects are tackling this challenge from various angles. Learn why implementation at the account level could be the key to achieving true chain abstraction and what the future holds for this transformative technology. Whether you're a developer, product manager, or crypto enthusiast, understanding chain abstraction is vital for navigating the future of blockchain technology.

tl;dr

• Chain abstraction is essential due to the rise of multiple chains aimed at addressing scalability.

• It refers to the process of unifying the user experience across different blockchains.

• Various projects approach chain abstraction from different angles: chains, bridges, tokens, protocols, and accounts.

• The account level is best suited to achieve chain abstraction, as it can integrate the most components between the user and blockchain, and users already trust their account providers.

• Effective chain abstraction requires several elements, including cross-chain liquidity networks, universal address standards, and standardized cross-chain communication and account abstraction.

• Chain abstraction is key to mass adoption, making it easier for users to achieve their financial goals and lead secure, prosperous lives.

Introduction

In this article, we explore the concept of chain abstraction. We'll look at the evolution of the blockchain landscape, starting with the explosion of chains designed to solve the scalability problem. We’ll then discuss the current efforts to abstract these chains and unify the user experience, and finally, envision what a fully chain-abstracted blockchain industry could look like in the future.

We define full chain abstraction as the ideal solution to the blockchain scalability challenge. It represents a state where every blockchain transaction is chain-agnostic, meaning users no longer need to think about or even know which chain they are interacting with when using blockchain applications.

Before Chain Abstraction: The Explosion of Chains to Solve Scalability

Chain abstraction has become a major focus in the ongoing effort to scale the Ethereum network.

Chain abstraction can only be understood in the context of blockchain development. Here’s a brief overview of blockchain history:

Bitcoin, introduced in 2008, was the first blockchain as we know it today. In the following years, several altcoins emerged, with slightly altered versions of the Bitcoin codebase (e.g., Litecoin, Dogecoin). At this time, each coin operated on its own chain, so chain abstraction wasn’t a consideration—users had to interact directly with each coin's specific blockchain to buy or trade it.

In 2015, Ethereum revolutionized the space by allowing the issuance of tokens without the need for a new blockchain. For the first time, users could interact with one chain (Ethereum) to handle multiple tokens. However, Ethereum’s early tooling was minimal, requiring users to rely on command-line tools for transactions. The launch of MetaMask in 2016 introduced a user-friendly graphical interface, making it easier to send transactions. MetaMask and similar wallets offered a form of "transaction abstraction," simplifying the complexity of encoding and signing transactions and significantly improving user experience.

From 2017 to 2020, the crypto ecosystem saw rapid tooling improvements (including the development of Safe), the rise of ICOs, and the infamous rug pulls, followed by the first crypto winter. During this period, the concept of abstraction wasn’t a major focus, as most users were technically savvy and nearly all activity occurred on Ethereum. However, new chains emerged, experimenting with smart contracts, consensus mechanisms (e.g., Matic, now Polygon, launched the first Proof of Stake chain in 2017), and even different programming languages for smart contracts (e.g., EOS supported contracts in C++ in 2018).

Then came the "DeFi Summer" of 2020-2021. New protocols, innovative developers, and large amounts of liquidity attracted waves of new users. As a result, transaction costs on Ethereum surged, with fees reaching $40 or more. This spurred demand for lower-cost alternatives, prompting the rise of new blockchains that offered DeFi ecosystems with unique mechanisms (e.g., Celo, Terra, Avalanche, Binance Smart Chain, Solana, and Polygon, which became Ethereum’s first rollup with substantial TVL).

This period, often referred to as the "chain explosion" or "chain diversification," solved the high transaction cost problem by increasing overall blockchain throughput. However, it introduced new complexity for users. Managing multiple chains in a wallet became cumbersome. Users had to ensure they were using trusted RPC URLs, had sufficient funds on the correct chain, and tracked the right token addresses on each chain. Furthermore, Smart Accounts (then known as Multisigs) often had different addresses on different chains, which led to funds lost due to a wrong destination address.

While transaction costs dropped, the user experience deteriorated. Managing multiple chains became a headache for users, and bridges between blockchains proved to be a significant security vulnerability, with over $2 billion lost in bridge hacks.

Protocols and chains also faced challenges in this multi-chain environment. Liquidity became fragmented, with Ethereum holding 50-60% of the total liquidity, while the rest was spread across other chains. This fragmentation forced chains to compete for liquidity through airdrops, and protocols had to consider liquidity availability when deciding where to deploy. This dynamic hurt competition, benefiting first movers over chains with superior technical capabilities.

Though transaction costs remained low, the growing pains of managing multiple chains remained unsolved. As a result, the space began to focus on the idea of chain abstraction.

Chain Abstraction: The Key to Unifying the Multi-Chain World

Chain abstraction is the current hot topic in blockchain development. With Safe deeply involved in account abstraction, it's important to put chain abstraction in perspective. In this section, we’ll explain what abstraction is, what chain abstraction entails, why it’s best implemented at the account level, and why the ongoing debates around it matter.

What is Abstraction?

Abstraction is not a new buzzword—it’s a fundamental concept in technology, society, and even the evolution of life. Abstraction simplifies complex systems by hiding the intricate details behind user-friendly interfaces, enabling progress by building on previous developments.

Take biology, for example: Photosynthesis was first "invented" by cyanobacteria when life on Earth was primarily single-celled organisms. These bacteria eventually evolved into chloroplasts, which carried out a more efficient form of photosynthesis. But it wasn’t until other cells absorbed these chloroplasts—harnessing their energy—that a new chapter of life began: the emergence of plants. In this case, photosynthesis, the biochemical process crucial to aerobic life, only reached mass adoption after an additional layer of abstraction simplified and repurposed it.

The same idea applies to technology. Consider cars: for most people, a car is simply a way to get from point A to point B. Drivers don’t think about the engine, fuel combustion, or ABS software—these are abstracted away. Instead, the driver interacts with a simple interface: gas pedal, brake, steering wheel, and maybe the radio volume. This abstraction makes driving accessible to the masses.

In the crypto space, wallets like MetaMask perform a similar function. Before MetaMask, users had to manually sign transactions with private keys. MetaMask abstracts this complexity, allowing users to authorize transactions with the click of a button. This type of abstraction made DeFi accessible and fueled its explosive growth in recent years.

Abstraction is a key part of evolution. It involves taking complex advancements, boxing them up, naming the box, and using it as a building block for the next phase of development. Abstraction is iterative, repeating as more layers of complexity are hidden away.

What is Chain Abstraction?

Chain abstraction is the process of making blockchains invisible to end-users.

In the Ethereum ecosystem, chain abstraction is the next evolutionary step in scaling, especially through rollups. But more broadly, chain abstraction commodifies blockspace, standardizes access across chains, and creates a unified user experience.

The goal of chain abstraction is to make interacting with multiple blockchains as seamless as using just one. Just as abstraction in biology and technology removes unnecessary complexity, chain abstraction aims to hide the differences between various chains, offering users a fluid, simplified experience when interacting with blockchain applications.

Defining the Future: What is Full Chain Abstraction?

Full chain abstraction envisions a world where every blockchain transaction is abstracted to the point that users no longer see or care about which chains are involved. Similar to how full account abstraction makes every account a smart account, full chain abstraction ensures that transactions can occur seamlessly across multiple chains, with minimal awareness from the user. Execution times and costs may vary, but these details will only be shown if relevant or requested by the user.

Defining full chain abstraction provides a clear target, much like the full account abstraction roadmap. Both are essential steps toward "full crypto abstraction," where crypto transactions become indistinguishable from traditional financial transactions. By this definition, both full account abstraction and full chain abstraction are necessary to bring the user experience of blockchain applications in line with the ease of web2 financial applications. Together, they move the industry closer to the ultimate goal of mass adoption.

While full chain abstraction remains a future innovation, we can outline how it might impact various stakeholders in the crypto space.

User Experience

• No Chain Names: Users will no longer need to see or know which chain they’re using during a transaction.

• No Chain-Specific Balances: Users won’t need to worry about maintaining funds on specific chains.

• Unified Balances: Users will see a single balance per asset, regardless of the underlying chains holding those assets. Detailed breakdowns will be available upon request.

• Risk Abstraction: Users will no longer need to evaluate the security of each chain individually. Risk management could either be fully automated by the account, or users could be given the option to set their own risk preferences.

• Clear Transaction Details: Only relevant details like execution time and gas cost will be shown by default. Technical options such as gas or transaction routing will be opt-in for advanced users.

• Flexible Gas Payments: Users won’t need to think about gas fees. A default payment option will be suggested, but they can choose to pay with different tokens if desired.

• Investment by Economic Preferences: Users will select investment opportunities based on their economic goals and risk preferences, without needing to know which chain the investment is hosted on unless they opt to see that information.

Wallet and Smart Account Providers

• Simple Interfaces and UX: Wallets and smart accounts will offer user-friendly interfaces, with secure login methods like passkeys. Transaction signing will be seamless and secure, possibly utilizing session keys and advanced signature schemes.

• Cross-Chain Execution: Wallets and smart accounts will automatically handle cross-chain execution to fulfill user intents, ensuring smooth operation.

• Protocol Communication: Wallets and smart accounts will transmit the account state to protocols, complementing the information gathered through RPCs.

• Offloaded Cross-Chain Management: Protocols can rely on wallets, smart accounts, a network of solvers (that help to fulfill a user intent, i.e. buy one ETH on chain X), and bridges to manage cross-chain transactions on behalf of users.

Protocols

• Technical Flexibility Over Liquidity Constraints: Protocols will deploy on chains that best fit their technical requirements, without needing to worry about the liquidity available on a particular chain.

• Bridging Costs Considered: Protocols can take into account bridging costs and execution speed when choosing chains for deployment.

• Access to Total Blockchain Liquidity: Protocols will be able to access the entire pool of blockchain liquidity across all chains, making it easier to target the total addressable market.

• Focus on Financial Innovation and UX: With liquidity management abstracted away, protocols can concentrate on competing through superior user experiences and financial innovation.

Chains and Rollups

• Technology-Driven Competition: Rollups will compete based on technological advantages rather than liquidity, as liquidity will naturally follow top-performing protocols. They will no longer rely on airdrops to attract liquidity.

• Protocol-First Strategy: Rollups will focus on attracting protocols, which in turn will bring liquidity to their chains.

• Settlement Layers: Ethereum and other Layer 1s will primarily function as settlement layers for rollups, facilitating finality and security.

This vision is not exhaustive, and many ideas will continue to evolve as innovation progresses. While some aspects may change or prove unattainable, this definition provides a roadmap that can guide us toward a more unified, user-friendly blockchain future.

Different Projects Tackling Chain Abstraction from Various Angles

In the decentralized crypto space, numerous actors approach chain abstraction from different perspectives. This overview explores how different projects are solving the challenge of chain abstraction, from the chain level to the account level.

Chain Level

To address chain abstraction at the chain level, projects aim to position themselves as "Layer Zero" or the "blockchain of blockchains." These chains serve as the settlement layer for other chains to handle cross-chain messaging. While Ethereum operates as Layer One for its rollups, other projects attempt to act as a Layer Zero beneath or above Ethereum and other Layer Ones. Some notable examples include:

• Layer Zero: As the name suggests, Layer Zero connects multiple blockchains.

• Cosmos: Cosmos aims to create a "network of blockchains" through its Inter-Blockchain Communication (IBC) protocol.

• Near: Near offers an "abstraction stack," providing a comprehensive infrastructure for web3 developers.

• Omni Network: Connects liquidity across Ethereum rollups and is secured by EigenLayer.

• Optimism’s OP Stack: Provides tools for a network of interoperable optimistic rollups.

• ZKSync Stack: Provides tools for a network of interoperable zero-knowledge proof rollups.

Bridge Level

Bridges connect blockchains without positioning themselves as a "blockchain of blockchains." Bridges often have a more centralized element, requiring users to trust the bridge rather than follow the “don’t trust, verify” ethos of blockchains. Security is typically enhanced through cryptographic methods or staking, and some bridges maintain their own liquidity pools to facilitate token swaps. In many cases, bridges also rely on infrastructure provided by chain-level solutions. Prominent examples of bridges include:

• Stargate: Built on LayerZero V2, this bridge implements liquidity pools and offers fast, low-cost cross-chain transactions.

• Orbiter Finance: Bridges between EVM chains using Zero-Knowledge Proofs.

• Across: Uses a network of solvers to compete for the best execution of a user's intent.

• IBC: The native bridge for the Cosmos ecosystem.

• LI.FI: Provides a bridge aggregator and API, used by MetaMask to enable cross-chain transactions.

• CCIP by Chainlink: Chainlink’s Cross-Chain Interoperability Protocol allows token transfers and messaging across chains, relying on burn-and-mint mechanisms to move tokens between chains.

Platform Level

Platforms consist of a combination of on-chain and off-chain components that work together to enable seamless cross-chain communication and transactions. They provide a foundation for other chain-agnostic projects to be built upon.

• SOCKET Protocol: A blend of off-chain and on-chain elements that allows developers to create chain-agnostic applications. It currently facilitates billions in cross-chain transactions every month.

Token Level

At the token level, specific projects like Circle, the issuer of USDC, offer their own bridge solutions. Circle’s Cross-Chain Transfer Protocol (CCTP) is a widely used cross-chain transfer mechanism but is limited to USDC. Users trust Circle to maintain a 100% reserve for USDC, as well as the stability and solvency of its partner banks. As a result, many users are comfortable trusting Circle for cross-chain USDC transfers. CCTP is currently live on eight chains.

There are projects like xERC20 to standardize cross-chain deployments of tokens.

Protocol Level

Chain abstraction can also occur at the protocol level, where decentralized applications (dApps) offer chain-agnostic interactions. While this approach is not yet widespread, some protocols are exploring this direction. Aave, for example, operates liquidity pools on different chains, with APYs varying across chains.

• Vertex Protocol: Vertex offers perpetual futures, spot trading, and lending markets on two chains. It uses a centralized limit order book to match orders from both chains and rebalance funds as needed, allowing users to manage assets across chains without dealing with cross-chain complexity.

• UniswapX: UniswapX uses a network of fillers to fullfil users intent. In the next version, UniswapX will support cross-chain intents.

• Aave V4: Aave currently discusses to introduce a cross-chain liquidity layer.

• Bungee Exchange: A cross-chain exchange built on the SOCKET protocol. It handles $2.5 billion in volume every month and powers swaps on platforms like MetaMask, Coinbase Wallet, and many others.

Account Level

At the account level, chain abstraction allows users to interact with multiple blockchains without needing to manage chain-specific details. This approach is becoming increasingly popular in wallets and centralized exchanges (CEXes).

Centralized Exchanges (CEXes)

CEXes provide one of the earliest forms of chain abstraction by allowing users to trade crypto assets without creating accounts on different blockchains. Although users must trust the CEX, these platforms offer easy access to crypto trading and other financial activities, such as staking and liquidity provision. However, users do not control the private keys, and the risk of fraud or failure (as seen with FTX and Mt. Gox) remains.

CEXes typically offer two main trading options:

• Spot Trading: Users can trade assets held in custodial wallets, with the exchange managing the private keys.

• Crypto Derivatives: Instruments like perpetual futures allow leveraged or short positions on crypto assets without owning the spot asset. The derivatives market often surpasses on-chain trading volume, demonstrating significant demand for chain-abstracted solutions.

Wallets

Some wallets are now integrating chain abstraction by offering token swaps and cross-chain transactions directly within the user interface (UI). For instance, MetaMask uses LI.FI’s API to facilitate cross-chain interactions while allowing users to maintain control over their private keys. Coinbase Smart Wallet MagicSpend allows users to spend funds directly from their Coinbase account. However, most actions within wallets remain chain-specific, as decentralized apps (dApps) rarely offer fully chain-abstracted interactions.

Decentralized Universal Accounts or Balances

The concept of a decentralized universal account is relatively new. These accounts aggregate balances across different chains, showing a unified total to the user. For example, if a user holds 1 ETH on Base and 2 ETH on Arbitrum, the account would display a combined 3 ETH. These accounts can also facilitate transactions on any chain by sourcing liquidity from other chains in the background, often using solvers to execute the transaction.

Some early examples include:

• Particle Network: Leading the space with universal accounts that source liquidity across chains and offer sponsored gas transactions.

• OneBalance: Provides a unified balance and uses session keys for secure, cross-chain transaction signing.

• MagicAccount: Offers a unified balance with integrated DeFi protocols, building on ZeroDev’s chain-abstracted smart accounts, which, under the hood, utilize the SOCKET protocol

These innovations across different levels of the blockchain ecosystem illustrate the diverse approaches to solving chain abstraction, with each focusing on specific aspects of user experience, liquidity, and security.

Why Full Chain Abstraction needs to happen at the Account Level

Accounts are the user interface of crypto. They sit closest to the user, which means they have the potential to abstract away the most complexity between the user and the blockchain. When chain abstraction happens at the account level, it results in the biggest improvement to the user experience.

Technology should make it easier for people to achieve their goals. In crypto, that means simplifying blockchain interactions for users. Accounts and wallets are the cockpit for these interactions—the primary tools people use to manage their assets. If these tools don’t help users reach their goals, they’ll move on to something that does.

There are two key segments of crypto users:

1. Value-driven users

   are motivated by principles like self-custody, censorship resistance, and decentralization. They’re passionate about the tech and ethos behind blockchain. However, this segment is relatively small, and blockchain adoption within it is already high. Most people who value these principles are already involved in crypto, and existing tools cater well to them.

2. Wealth-driven users

   are primarily interested in the financial opportunities that crypto offers. This group is much larger and represents the biggest potential for growth, but they are often put off by the complexity of blockchain tools. They don’t want to manage gas fees, chain selection, or bridging tokens—they want a simple, reliable interface that helps them grow their wealth without needing to understand the technical details.

While both segments are important, the second group is where the largest growth potential lies. Crypto tools today are largely focused on the value-driven users, but the wealth-driven segment is underserved. Building simple tools for wealth-driven users will help to onboard the next billion crypto users.

Stripe’s success came from abstracting away the complexities of payments, helping businesses sell easily and allowing millions of users to buy what they wanted without hassle. Similarly, full chain abstraction should simplify crypto transactions to the point where users don’t even need to think about chains, gas, or security.

Here’s why different layers of abstraction are needed:

• Account Abstraction: Users don’t want to manage private keys.

• Chain Abstraction: Users don’t want to deal with multiple chains.

• Gas Abstraction: Users don’t want to worry about gas fees.

• Security Abstraction: Users want to feel safe, trusting their crypto interactions just like they trust their bank.

Together, these layers form what could be called crypto abstraction—the process of making the blockchain invisible to the end user. In a fully abstracted world, users wouldn’t need to know whether a product is decentralized or centralized. They would access both seamlessly through the same interface and account.

Since accounts are the interface through which users manage their money and reach their goals, account providers are best positioned to abstract the rest of crypto, improving the overall user experience.

What’s Needed to Enable Full Chain Abstraction

Achieving full chain abstraction requires progress across multiple areas. Here’s a non-exhaustive list:

Functional Network of Bridges and Cross-Chain Messaging Protocols

A variety of bridges and cross-chain protocols already allow users to move between chains. However, full chain abstraction requires these systems to work smoothly together. This area is relatively well-covered, as it's been one of the first areas of innovation.

A Cross-Chain Liquidity Network

Fast cross-chain transactions rely on liquidity being available across different chains. A liquidity network controlled by solvers can facilitate quicker transactions, taking on the risks and providing users with convenience for a fee. Whether each solver manages their own liquidity or liquidity providers offer this service, capital efficiency can be optimized to speed up cross-chain transactions.

Chain-Agnostic Address Standards

Standardizing how different chains handle addresses simplifies development and adoption. The Chain Agnostic Improvement Proposals (CAIP) project works on these standards. For example, CAIP-10 provides a format to identify accounts across chains. Additionally, EIP-3770 introduces a chain-specific address format already used in Safe Smart Accounts.

Universal Account Identifier

A chain-abstracted identifier would allow users to receive funds without worrying about destination addresses. For instance, instead of "send me 1 ETH to eth:0xab16...," it would be "send 1 ETH to alice.eth" The technology would automatically find the best chain for the transaction. This could build on systems like ENS.

Standards for Cross-Chain Intents and Communication

Standardized data formats for cross-chain intents would simplify interaction between wallets, solvers, and liquidity providers. ERC-7683 is an emerging standard aimed at unifying the format for cross-chain intents, enabling a smoother experience for all actors in the ecosystem.

Account Abstraction Standards

Full chain abstraction requires full account abstraction. Important standards include:

• EIP-1271: Enables Smart Accounts to sign messages on a per-chain basis or.

• ERC-4337: Introduces the ability for Smart Accounts to send batched and sponsored transactions.

• EIP-7702: Allows EOAs to adopt Smart Account features, scheduled for release with the Pectra Ethereum update in 2025.

• EIP-6492: Allows counterfactually deployed Smart Accounts to sign messages, which enables more chain abstracted use cases.

Conclusion

Full Chain Abstraction is critical for mainstream crypto adoption. While many technologies must work together seamlessly, wallets and Smart Account providers are in the best position to offer chain-abstracted solutions. They already have the user base and the trust needed to make this happen.

Safe is actively contributing to cross-chain projects and account abstraction to help bring about full chain abstraction.

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