AXL Axelar Network

Use Cases of Axelar Network

The Axelar Network serves several key purposes in enhancing blockchain interoperability:

• Multi-chain Asset Issuance: It allows for the deployment of assets like stablecoins and real-world assets (RWAs) across multiple blockchain networks. This is particularly useful for DeFi protocols and issuers who need to manage assets on different chains. For example, Circle uses Axelar for composable USDC, and Lido, the largest DeFi protocol, leverages Axelar for multi-chain deployments.

• Public/Private Blockchain Connections: Axelar enables interoperability between public and private blockchains. This is beneficial for companies like JP Morgan (Onyx) and Provenance, which use Axelar to connect their private chains with public blockchains, facilitating seamless interactions between different blockchain ecosystems.

• Payments and Onramp: The network allows for the onramping of assets from any connected chain into various protocols and enables payments using any asset on any connected chain. This is utilized by projects like Centrifuge, which tokenizes on-chain credit, and DYDX, which benefits from Axelar's cross-chain capabilities.

• Interchain Applications: Axelar supports a wide range of interchain applications, including token swaps (e.g., Squid), lending (e.g., Prime Protocol), and gaming (e.g., Junkyard). These applications can operate across multiple blockchains, leveraging Axelar's interoperability features.

• Developer Tooling: Axelar provides developers with tools to deploy and manage applications across multiple chains from a single place. This includes an orchestrator that automates deployment and management, making it easier for developers to build cross-chain applications.

Pros of Axelar Network

• Decentralized and Permissionless: Axelar Network is a decentralized and permissionless solution that delivers the same level of decentralization as the blockchains it connects, ensuring secure cross-chain transactions.
• Full-Stack Interoperability: It offers full-stack interoperability, enabling arbitrary data transfer, smart contract execution, and permissionless overlay programmability across networks.
• General Message Passing (GMP): Axelar's GMP allows developers to build on any supported chain and call functions on any other connected chain, opening up endless possibilities for cross-chain applications.
• Scalability: The network is designed to scale to support hundreds or even thousands of blockchains, making it a robust solution for the growing blockchain ecosystem.
• Consensus Agnostic: Axelar is consensus agnostic, allowing it to connect with all chains, including EVM chains, Bitcoin, and Cosmos-based chains.
• Rate-Limiting Functions: It uses rate-limiting functions to prevent large-scale attacks and keep the network stable under heavy load.

Cons of Axelar Network

• PoS-Based Economic Security Model: In the short term, Axelar's biggest drawback is its PoS-based economic security model, which can be vulnerable if Axelar has fewer funds locked up than the networks it serves.
• Centralization of Voting Power: If the voting power becomes more concentrated, it could reduce the actual security of the proof-of-stake system, although quadratic voting helps mitigate this concern.
• Liveness Issues: Validators can choose which chains to support, which could lead to liveness issues if not enough validators support a particular chain.
• Dependence on Validator Set: The network's security is derived from the collective agreement of a large number of validators, which can be a point of failure if not enough validators are honest.

Founders of Axelar Network

The founders of Axelar Network are:

• Sergey Gorbunov: Co-founder and CEO of Axelar. He was previously a founding team member at Algorand and received his Ph.D. from MIT, where he was a Microsoft Ph.D. fellow. His Ph.D. dissertation was on designing cryptographic tools for the cloud using lattice-based cryptography.
• Georgios Vlachos: Co-founder of Axelar. He was also a member of the Algorand founding team and designed the Algorand consensus protocol.

Investors in Axelar Network

Axelar Network has secured funding from various notable investors across different rounds. Here are some of the key investors:

• Series A Round:

  • Polychain Capital
  • Dragonfly Capital
  • Galaxy Digital
  • North Island Ventures
  • Robot Ventures
  • Collab+Currency
  • Cygni Capital
  • Lemniscap
  • Divergence Ventures
  • SCB 10X
  • Hypersphere
  • Zola Global Investors
  • Morningstar Ventures
  • Nima Capital
  • GoldenCoin TS LLC
  • Angel investors like Do Kwon, Happy Walters, and Waikit Lau.

• Series B Round:

  • Dragonfly Capital
  • Polychain Capital
  • North Island Ventures
  • Rockaway Blockchain Fund
  • Cygni Capital
  • Lemniscap
  • Olive Tree Capital
  • Blockchange Ventures
  • Node Capital
  • Angel investors including Waikit Lau and Gokul Rajaram.

• Additional Backers:

  • Coinbase Ventures
  • Binance Labs
  • Galaxy
  • Hypersphere Ventures
  • Divergence Ventures
  • RockawayX
  • Crypto.com Capital
  • Morningstar Ventures.

Halal Status of Axelar Network

• Halal Status: Yes
• Reason: The Axelar Network operates on a model that aligns with Islamic finance principles. It generates revenue through network fees paid in AXL tokens for cross-chain communications and transfers, which is considered permissible under Islamic law.