What are the criteria for measuring the success of cross-chain bridges?

23-04-20 17:40

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Original title: What is the criterion for measuring the success of cross-chain bridges?

Cross-chain bridges have become an integral part of the blockchain ecosystem. As the number of available blockchains increases, users will frequently use cross-chain bridges to transfer assets and data between different chains when exploring different ecosystems.

However, the success of a cross-chain bridge cannot be measured solely by its Total Value Locked (TVL). On the contrary, the number of transactions (Txn account), cross-chain volume (Bridging volume), and user retention rate (retention rate) can better measure the success of cross-chain bridges.

Can the total locked amount be used as an indicator?

Total Locked Volume (TVL) is a commonly used indicator to measure the success of DeFi protocols. This works effectively in this space, as DeFi protocols rely on available liquidity to function, and higher TVL values can be interpreted as users having greater confidence in the protocol.

However, measuring the success of a cross-chain bridge based solely on its TVL size, total number of transactions, and cross-bridge connections may be misleading to users. These metrics do not give a complete picture of a cross-chain bridge and its performance in terms of user retention.

There is a view that the number of retained users can more accurately measure the success of the cross-chain bridge. This metric reflects the average number of transactions per user and provides a measure of the average number of times a user retains after first use. If users return more frequently, it can be credibly said that the bridge is more successful in user retention.

Understand the importance of user retention.

Then why is the user retention rate a reliable indicator for measuring the performance of cross-chain bridges? First of all, it reflects the user's cross-chain experience. Cross-chain bridges that are easy to use and provide a seamless cross-chain (asset) experience are more likely to attract users and convert them into loyal users. On the contrary, cross-chain bridges that are difficult to use or unreliable will have shortcomings in user retention.

Secondly, retention also indicates the user's trust in the bridge used. As long as the bridge does not suffer any major security incidents, user trust will persist. However, most users of cross-chain bridges start using them without fully understanding the risks involved in transaction design. For those users who use cross-chain bridges for transactions, the speed of cross-chain transactions and the fluency of cross-chain transactions are their main concerns. If after a security incident or other negative event, users are not aware of these risks until it is too late.

Finally, the user retention rate can be a reference indicator regarding the growth potential of the bridge. High frequency of use by users may indicate that they think the cross-chain bridge works well and are willing to use it again in the future. One possible conclusion: this will lead to an increase of new users on the platform, thus increasing the potential of the bridge to attract new users.

Comparison of current cross-chain bridges

Involved Supported bridges include Allbridge, Axelar, Celer Networks cBridge, Connext, deBridge, LayerZero Stargate, Multichain, and Synapse Protocol. The Wormhole bridge was also considered, but the required data was not available, so the Wormhole comparison was abandoned.

From the above table, we can infer the number of transactions per unique address by dividing the transaction frequency of each unique address by the total number of transactions of the bridge. This provides the following results: Multichain has the highest number of transactions (unique addresses) with an average of 6.05. This was followed by Synapse at 5.41, Celer at 3.79, Stargate at 2.34 and deBridge at 1.97.

At the same time, the average cross-chain value also shows another perspective, Multichain continues to lead in this regard, with an average of $19,413.05, followed by Stargate for $9,379.36, Celer $9,267.94, Synapse $1,654.36 and deBridge $737. Let's explore the possible reasons behind their respective performances. This will shed more light on the ways in which Bridge has accomplished so far.

Multichain

Multichain bridges blockchain and Token is The most among all cross-chain bridges, but most of the transaction volume is still concentrated between the well-known public chains shown in the figure below. However, there is reason to believe that users who transfer assets between lesser-known blockchains may also use it when well-known public chains cross-chain; usually, the cross-chain of mainstream Token is considered to increase the transaction volume Reasons, but there is no evidence to support this, but it can be assumed that its wide range of ecological support has promoted the market share and exposure of Multichain cross-chain bridges to a certain extent.

Celer (cBridge)

< p>Celer is connected to 46 blockchains, which has a good user retention rate and average cross-chain value. Recently, Celer was included in the Bridges section of the Metamask dApp collection, which may be the reason for its recent increase in transaction volume. However, as the number of transactions increases, the cross-chain value does not increase proportionally, and the effect has not yet been fully realized.

Synapse

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It is particularly worth noting that after Synapse surpassed Multichain in total transactions and independent addresses, the average cross-chain amount was lower than Multichain and Celer. This may be due to its integration with projects such as DeFi Kingdoms, bringing in a large number of users and transactions, but with lower overall value. Synapse also has an active community on Twitter, which in part contributes to its increased visibility.