What Is LayerZero?
Also known as: LayerZero Protocol, ZRO, Omnichain Protocol
In short
LayerZero is an interoperability protocol that enables the transmission of messages and data between different blockchains; it lets applications build 'omnichain' structures that can transfer tokens and information across multiple chains.
LayerZero places an endpoint smart contract on each chain it supports. When an application on one chain sends a message, independent verifiers confirm that the message truly originated on the source chain, and it is then executed on the destination chain. In the protocol's current version, applications can configure which verifier networks (DVNs) they use and how many confirmations they require; in the first version, this task was handled by an oracle and relayer pair.
Thanks to this infrastructure, developers can use standards such as OFT (Omnichain Fungible Token), which lets a single token circulate across multiple chains while preserving its total supply. Cross-chain bridges, lending protocols and games also use LayerZero as a messaging layer. The protocol's native token is ZRO.
The security of an application that uses LayerZero depends largely on the verification configuration it chooses. A weak configuration, or one that relies on a single party, increases the risk of fake messages being accepted. This detail matters given that cross-chain bridges have been targets of major attacks in the past.
Last updated: · This content is for information purposes only and is not investment advice.