1inch's Fusion+ Is the Future of Cross-Chain DeFi Fusion
Cross-chain bridging has long been crypto's Achilles heel: According to DeFi security blog Rekt News, four of the five largest exploits by total value (about $2.15B) resulted from attacks on cross-chain infrastructure.
Though exploits are a concern, security isn't the only reason DeFi traders avoid bridging. Long withdrawal times, a lack of transparency and an overall difficult user experience have prevented traders from accessing new markets and executing more advanced cross-chain trading strategies.
To alleviate withdrawal delays and user experience issues, a new intent-based infrastructure has emerged to create more efficient trading across chains. Still, the centralization of current intent-based trading systems has continued to face the same transparency and security issues as previous bridging solutions.
That was until 1inch's Fusion+: an intent-based, atomic swap protocol that mitigates these risks by being fully decentralized and self-custodial. Fusion+ is bringing cross-chain DeFi into a new, decentralized era of intent-based architecture to defragment liquidity across ecosystems and create a more effective trading experience for all.
Creating a more efficient system
The primary issue with existing intent-based applications is centralization. Intents require the use of resolvers to settle trades, many of whom are professional market makers. The current solutions on the market today require trust in these intermediaries, stoking concerns over a higher bar of entry for individuals. In turn, this barrier to entry can create a monopoly over trade execution and the stagnation or inflation of exchange rates.
Fusion+ looks to solve this concern through a system of Dutch auctions for resolvers and atomic swaps.
In a Dutch auction, the price of an asset starts high and is progressively lowered until a bidder accepts the current price, thereby winning the auction. In the case of Fusion, the exchange rate starts high and decreases until a resolver accepts a rate and executes the swap. As a result, this auction system can decrease exchange rates over time until a bid is accepted, reducing slippage, promoting competition and providing better overall pricing for traders.
Fusion+ utilizes a unique system of atomic swaps to decentralize this auction system, further support price competition and streamline user experience. Atomic swaps are a P2P, self-executing system of smart contracts that eliminates the need for trust among parties. Unlike traditional atomic swaps, Fusion+ allows for multiple resolvers to fill a single order, making larger trades execute more efficiently.
A better user experience
While the backend process seems more involved than traditional AMM swaps, Fusion+ makes for a more streamlined user experience. Users must select their desired token alongside its network and then choose the destination token and chain.
Building off the Fusion platform, Fusion+ also inherits existing UI enhancements for users like minimum receive and zero network fee parameters and is available natively within the 1inch Wallet and 1inch dapp.
Though the rise of intent-based architecture for cross-chain DeFi has alleviated many of the pains felt in the current generation of fragmented bridges, new solutions continue to face the same issues of centralization and lack of transparency.
As an intent-based, atomic swap protocol, 1inch Fusion+ is set to create a more efficient and accessible DeFi market across all blockchains.
