What is Axelar (AXL)? How Does Axelar Work?

The web3 ecosystem has significantly demonstrated its strength over the years. And it’s now an admitted fact that web3 is going to be the future of the internet. But the adoption rate isn’t as high as it should be. That’s because web3 applications can’t interact with each other. The developers need to integrate fractured services to connect their applications with other blockchain networks.

Unfortunately, the fractured services are quite expensive and they also possess a security risk for blockchain networks. Similarly, the developers are required to put in additional coding efforts to connect their applications to other networks. Axelar solves this problem with its simple one-click functionality. Thus, it simplifies transaction processing and cross-chain communication for developers and users alike.

Here are some of the key takeaways from the article:

• Axelar provides a solution to the problem of cross-chain communication, which is a major obstacle to the adoption of web3.
• Axelar is a secure, scalable, interoperable, easy-to-use, and cost-effective platform.
• Axelar is a promising project that has the potential to play a vital role in the future of web3.

What is Axelar (AXL)?

Axelar is a web3 platform dedicated to providing frictionless cross-chain communication. The protocol breaks the barriers to cross-chain communication with its APIs, tools, and suite. The platform has a permissionless, open network of validators that help with keeping it secure. The network offers a one-click functionality that simplifies the process with its routing and delivery protocols.

The developers can now build cross-chain applications using the cross-chain development toolkit. The network also simplifies the cross-chain debugging of applications with its innovative set of tools. The best part is that the developers can monitor the performance of their applications across different networks with a few simple steps.

The developers can establish secure and reliable communication between different blockchains with the help of cross-chain messaging protocol. It also provides a secure and efficient transfer of assets with its cross-chain asset transfer protocol. Axelar network is interoperable with a wide range of applications.

Thus, it can play a vital role in accommodating the rising demand for cross-chain communication. It will eventually boost the adoption rate of web3 technologies.

Benefits of Axelar

Secure – Axelar has a permissionless, open network of validators that thoroughly verify each transaction.

Scalable – Axelar offers a range of scaling opportunities with its cross-chain communication network.

Interoperable – Axelar network is interoperable with a wide range of applications. Thus, it can establish a strong network of decentralized applications.

Easy to use – The platform offers a simplified transaction process for users while offering easy-to-use development tools for developers.

Cost-effective – Unlike fractured services, Axelar offers an easy affordable network for building cross-chain applications.

Axelar Brief History

Axelar network was introduced by Sergey Gorbunov (serial entrepreneur and technologist), Ilya Volkov (former Goldman Sachs investment banker), and Michel Parasol (former Google engineer) in 2020. The team carried out a seed round in collaboration with Three Arrows Capital and Polychain Capital in 2021 and raised around $35 million.

Pantera Capital, Binance Labs, Alameda Research, and Coinbase Ventures are the leading names that invested in this project. The support of these industry leaders shows that the platform has great potential. Axelar’s mainnet was launched in 2022 and the project has experienced significant growth since then.

Axelar Important Features

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Axelar enhances the functionality of cross-chain routing with its innovative features.

Satellite – Satellite is a web application designed by the Axelar team to provide simplified and secure crypto asset transfers across different blockchains. Satellite provides an easy implementation process. It allows new users to conduct smaller transactions so they may understand its features.

Axelar Virtual Machine – The developers don’t need to manage their apps on multiple chains as they can use Axelar Virtual Machine to directly set up their DApps on Axelar. The developers can connect their applications to all the supported chains with the help of Interchain Amplifier. Similarly, they can manage their applications across all interconnected chains with Interchain Maestro.

General Messaging Protocol – General Message Passing enables developers to build an application on any blockchain network that best suits their needs. They can then make it accessible for users from all the interconnected blockchain networks. Thus, it offers more opportunities for gaming, NFTs, and other decentralized applications. General Message Passing enables users to transfer their assets in the form of wrapped assets.

How Does Axelar Work?

Axelar uses a network of three different layers to smoothly run its operations.

First Layer – The first layer uses a proof-of-stake consensus mechanism to process cross-chain requests. It provides a network of smart contracts that help validators with monitoring cross-chain communications.

Second Layer- The second layer consists of the smart contracts that are required for the successful execution of cross-chain transactions.

Third Layer – It offers a set of SDKs and APIs that the developers may need to build effective decentralized applications. With these tools, the developers can build and integrate their applications into multiple blockchain networks including Ethereum, Cosmos, Avalanche, and more.

The platform uses two foundational decentralized protocols to run its operations.

Cross-chain Gateway Protocol – It establishes a secure and efficient connection between smart-contract-capable and non-smart-contract-capable blockchain networks. No matter which consensus mechanism a network uses, it can connect to other networks without any restrictions.

Cross-chain Transfer Protocol – This gateway is designed to support cross-chain operations with a unified API. It receives requests from DApps and forwards them to the cross-chain gateway protocol. The CGP then sends the request to the destination blockchain and returns the results to the sending applications.

Axelar Tokenomics

AXL is the native token that the users may need to request a transaction. With a circulating supply of 288.5 million tokens, AXL has a market cap of $109 million. It ranks among the 200 best cryptocurrencies in terms of market cap.

Conclusion

Axelar is a web3 platform that provides frictionless cross-chain communication. The platform has a permissionless, open network of validators that help to keep it secure. Axelar offers a range of benefits, including security, scalability, interoperability, ease of use, and cost-effectiveness.

Feel free to get in touch with us if you need more information about how Axelar works. We also invite you to subscribe to our weekly newsletter if you need regular updates about Bitcoin and the crypto market.