Creating a Unique Blockchain: Advantages and Challenges
Establishing a non-EVM-compatible blockchain allows developers to investigate various consensus mechanisms and governance frameworks. This approach presents several benefits compared to the EVM-based Ethereum network. In some scenarios, it grants developers enhanced flexibility to customize consensus algorithms, improve transaction processing speeds, scale solutions, and create smart contract functionalities that cater to specific requirements. Additionally, non-EVM blockchains contribute to a competitive atmosphere within the blockchain ecosystem, promoting innovation and diversity in decentralized technologies.
Nonetheless, the process of developing and expanding non-EVM blockchains poses significant difficulties. Issues related to compatibility with existing Ethereum-based decentralized applications (DApps) and smart contracts often arise. Moreover, creating a supportive developer community and achieving network scalability are prevalent hurdles. Addressing these challenges necessitates a comprehensive technical strategy, solid community backing, and a compelling value proposition. This article delves into methods for overcoming these obstacles.
### Key Points to Consider
Non-EVM blockchains provide distinct benefits, such as tailored consensus mechanisms and customizable smart contracts, yet they face compatibility issues with Ethereum applications and scalability challenges. Prominent non-EVM blockchains today include NEAR, Solana, Algorand, Cardano, Polkadot, Cosmos, and Venom. Each of these blockchains possesses unique characteristics and varying degrees of compatibility with Ethereum. Several non-EVM blockchains have begun to establish pathways for Ethereum compatibility, including NEAR with Aurora, Solana with Neon EVM, Algorand through Milkomeda A1, and Cardano utilizing Milkomeda C1. The commercial success of EVM solutions for non-EVM chains can be assessed by their total value locked (TVL) and the influx of new users they draw from Ethereum. Current and future initiatives like Neon DAO, Lido, and Milkomeda illustrate the increasing demand for enhanced interoperability.
### Applications of Non-EVM Blockchains
We have identified seven originally non-EVM-compatible blockchains: NEAR, Solana, Algorand, Cardano, Polkadot, Cosmos, and Venom. While certain blockchains have successfully created an interoperable environment linked to Ethereum (such as NEAR, Polkadot, and Cosmos), others are still in the process of connecting their ecosystems with Ethereum-based DApps and the development community (including Algorand, Solana, Cardano, and Venom).
### NEAR Protocol: A Unique Approach
The NEAR Protocol operates with its own virtual machine, known as the NEAR Virtual Machine (NEAR VM), which is specifically optimized for the NEAR blockchain. It supports high scalability and throughput, with smart contracts written in the Rust programming language. NEAR primarily interacts with the Ethereum environment through Aurora, an independent Ethereum-compatible blockchain that functions directly on NEAR. Ethereum wallet users can access NEAR via the NETH smart contract.
### Aurora: Bridging the Gap
Aurora serves as NEAR’s EVM layer, functioning as a layer-2 blockchain that operates within Ethereum. This independent smart contract implementation allows for complete Ethereum compatibility, enabling developers to migrate their Ethereum smart contracts to NEAR seamlessly. By tapping into the extensive Ethereum ecosystem, Aurora attracts Ethereum developers and enhances cross-chain compatibility.
### NETH: Simplifying User Access
NETH is a smart contract designed to facilitate Ethereum wallet users in signing transactions on NEAR without switching wallets. It creates a linked NEAR account that allows signatures to be transferred within the NEAR ecosystem. This innovative solution effectively connects Ethereum users, including those from MetaMask and other Ethereum wallets, to the NEAR platform, which boasts over 30 million monthly active users.
### Solana: Speed and Scalability
Solana was engineered as a blockchain emphasizing rapid processing, minimal delays, and scalability. To achieve this, the Solana team created a bespoke blockchain rather than relying on the Ethereum Virtual Machine (EVM). They implemented a unique consensus mechanism known as proof-of-history (PoH) to facilitate swift transaction confirmations and maximize network throughput.
The Solana Virtual Machine (SVM) is employed for executing smart contracts, designed to optimize performance and support programming languages like Rust, C, and C++. Solana’s architecture and consensus model enable it to process transactions at high speeds, ensuring scalability.
### The Wormhole Bridge: Asset Transfer Made Easy
Launched in October 2020, the Wormhole Bridge enables users to transfer assets between Ethereum and Solana efficiently in both directions. Acting as a conduit, Wormhole enhances liquidity and interoperability, facilitating the bridging of tokens across diverse ecosystems, which broadens the scope for decentralized finance and cross-chain applications.
### Neon EVM: Ethereum Compatibility on Solana
Neon EVM is an adaptation of the Ethereum Virtual Machine that operates on the Solana blockchain. It allows developers to deploy and execute Ethereum-compatible smart contracts within Solana, utilizing existing Ethereum tools and ecosystems. The goal is to provide a familiar development experience and a smooth transition from Ethereum to Solana.
Recently, the Neon EVM team launched a closed beta version of Neon EVMβ on Solana’s mainnet, allowing users to deploy and test the platform in anticipation of its official launch. The ecosystem will be supported by the NEON token, which will serve governance and utility purposes.
### Lido on Solana: A New Era of Liquid Staking
Lido, a well-known liquid staking protocol from the Ethereum ecosystem, was implemented on Solana without relying on any EVM infrastructure. The deployment was managed by Chorus One, a provider specializing in staking integrations, which created a Solana-specific version of the protocol. The responsibility for Lido on Solana was later transferred to P2P Validator, a key player in the Solana ecosystem that has supported various projects, including Wormhole Bridge and Neon EVM.
The Lido project enables SOL token holders to connect their wallets to the Lido interface, depositing their tokens into the Lido program and receiving stSOL tokens in return, which represent their share of the total pool. The protocol distributes the deposited SOL among participating validators, thereby increasing the stSOL tokens’ value as rewards accrue.
### Algorand: Focused on Efficiency
Algorand distinguishes itself with its pure proof-of-stake (PPoS) consensus mechanism, allowing for quick and secure transaction confirmations without reliance on energy-intensive mining. Capable of processing thousands of transactions per second with minimal latency, Algorand is designed for large-scale applications. The Algorand Foundation has also pursued EVM compatibility to enhance scalability and interoperability, funding the development of EVM capabilities through Milkomeda in October 2022.
### Milkomeda: Bridging Ecosystems
Milkomeda is a blockchain-agnostic protocol that enhances interoperability by providing EVM capabilities to non-EVM blockchains. It employs layer-2 scaling solutions, such as rollups, which operate atop existing layer-1 blockchains and connect them through a permissionless bridge. By allowing non-EVM ecosystems to utilize essential features from EVM-based ecosystems, Milkomeda simplifies the development process for Ethereum projects on other chains.
Milkomeda A1, designed specifically for Algorand, uses mALGO as a gas and fee token, executing transactions on Algorand before bundling and sending them to Ethereum while retaining security properties. Users need an Algorand native wallet with $ALGO and an EVM-compatible wallet like MetaMask to access the A1 Rollup Mainnet.
### Cardano: Governance and Sustainability
Cardano emphasizes governance, aiming for community-driven decision-making and long-term sustainability. Its scientific approach combines peer-reviewed research with a layered architecture to achieve scalability, security, and sustainability. Utilizing a unique proof-of-stake consensus algorithm known as Ouroboros, Cardano ensures energy efficiency and decentralization.
The KEVM project, part of Cardano’s Goguen era, was an early attempt at EVM compatibility, offering a smart contract virtual machine compatible with EVM functionalities. Although development was paused to prioritize other projects, efforts to achieve EVM compatibility continue through Milkomeda C1.
### Milkomeda C1: Enhancing Cardano’s Interoperability
Milkomeda C1, launched in April 2022, serves as the main bridge between the Cardano and Ethereum ecosystems. Unlike Milkomeda A1, it operates as a sidechain, processing transactions and executing smart contracts independently of the Ethereum main chain, providing Cardano with flexibility regarding its own consensus mechanism.
Similar to Milkomeda A1, C1 utilizes mADA as its primary asset for gas and fees, simplifying the onboarding process for users interested in Ethereum DApps. Although Milkomeda C1 initially contributed significantly to Cardano’s TVL, its share has since declined.
### Polkadot: Unique Interoperability Approach
Polkadot employs a distinctive method for achieving blockchain interoperability via its parachain auction system. This framework enables projects to bid for slots on the Polkadot network and deploy their blockchains as parachains. Each parachain operates with its own consensus mechanisms and governance models while benefiting from the overarching security and interoperability of the Polkadot network.
Parachains are autonomous blockchains connected to a designated relay chain, relying on its consensus mechanism for security. Moonbeam, launched in January 2022, stands as Polkadot’s first parachain, facilitating Ethereum developers’ access to the platform.
### Moonbeam: EVM Compatibility on Polkadot
Moonbeam utilizes Substrate technology, offering full EVM compatibility. This compatibility enables Ethereum developers to deploy and execute their smart contracts on Polkadot, reaping the benefits of the network’s scalability, interoperability, and shared security. Moonbeam’s approach allows for seamless integration of existing Ethereum tools and DApps, making it easier for developers to transition their projects.
### Cosmos: A Layer-0 Blockchain
Cosmos is notable as a layer-0 blockchain that emphasizes interoperability, facilitating communication and asset exchange between different blockchains through its Inter-Blockchain Communication (IBC) protocol. This platform supports the development of sovereign blockchains that maintain their governance models and consensus algorithms while leveraging the broader Cosmos ecosystem.
### Kava and Evmos: Enhancing Compatibility
Kava, built on the Cosmos SDK, acts as a sidechain for Cosmos, enhancing interoperability between Ethereum and Cosmos. The Kava EVM platform allows Solidity developers to build DApps, benefiting from Kava’s security and scalability.
Evmos, serving as an IBC protocol and proof-of-stake network, incorporates EVM capabilities to facilitate value transfer between Ethereum and Cosmos. Constructed with the Cosmos SDK framework and employing Tendermint Core’s Byzantine Fault Tolerance consensus mechanism, Evmos aims to ensure resilience against node failures.
### Dymension: Modular Blockchain Solutions
Dymension is developing an L2 rollup solution compatible with the EVM for the Cosmos ecosystem. This rollup will support developers in deploying Ethereum applications on Cosmos while addressing the inherent code differences. Currently in testing, Dymension’s rollups are expected to function across various Cosmos chains, allowing for seamless interaction without the need for bridges.
### Venom Blockchain: A Regulatory Approach
The Venom blockchain operates within the Venom Foundation ecosystem, the first entity licensed by the Abu Dhabi Global Market to support a blockchain. With capabilities to handle 100,000 transactions per second, Venom employs dynamic sharding within a multilayer structure composed of master chains, work chains, and shard chains.
Workchains can be tailored to meet specific security, compliance, and privacy standards, making it suitable for various applications. Additionally, integrating EVM capabilities is a potential use case for these workchains. The programming language for smart contracts on Venom’s master and base chains is Threaded Solidity, a dialect of Solidity designed to be compatible with the Threaded Virtual Machine.
### Everscale: Innovations in Scalability
Everscale emerged from the Free TON project, initially based on Telegram’s whitepaper. After being acquired by the Venom Foundation, Everscale aims to rectify existing scalability issues within Ethereum’s architecture through a combination of data sharding and execution sharding.
Everscale’s EVM capabilities play a crucial role in Venom’s ecosystem, allowing for seamless interactions between blockchains. This unique feature enables smart contracts to communicate across different workchains, fostering a cohesive environment for contract execution and enhancing EVM integration.
### Economic Performance and Use Cases
The commercial viability of EVM solutions for non-EVM chains can be gauged by total value locked (TVL) and the influx of users and liquidity from Ethereum. For instance, Aurora smart contracts on NEAR have added a notable 29.7% to the platform’s TVL. NEAR, with its advanced ecosystem comprising various DEXs and lending protocols, effectively attracts Ethereum developers.
Polkadot’s Moonbeam and Moonriver parachains have collectively contributed approximately $44.93 million to the ecosystem’s TVL, successfully onboarding significant Ethereum-based projects like SushiSwap, Curve, and Lido. Meanwhile, Kava boasts a TVL of $194.89 million, while Lido on Solana has attracted $54.14 million. In contrast, solutions like Milkomeda C1, A1, Neon EVM, and Evmos have yet to demonstrate substantial traction, while Everscale and Dymension remain unreleased on a mainnet as of November 2023.
### Exploring EVM Integration for TON
When considering the integration of EVM capabilities into TON, several factors must be evaluated, including the asynchronous structure and Infinite Sharding. These unique architectural features of TON differentiate it from Ethereum, influencing the available solutions for achieving EVM compatibility.
The “blockchain of blockchains” structure of TON supports the establishment of workchains, which theoretically could operate with EVM capabilities and run Solidity contracts. However, the complexities and costs associated with creating a workchain pose significant challenges.
TON’s priority is to onboard Ethereum users into its ecosystem, focusing on attracting major Ethereum-based platforms to enhance its TVL. Consequently, solutions like NETH on NEAR may be less relevant, as the immediate goal is to bridge Ethereum liquidity into TON while maintaining its distinctive architectural characteristics.
### Evaluating Approaches for EVM Integration
The potential strategies for implementing EVM capabilities on non-EVM blockchains can be categorized into five main options. EVM sidechains and workchains appear to be the most suitable for TON, leveraging its unique scaling and transaction processing capabilities while facilitating the onboarding of users to EVM projects. Implementing a rollup could also help minimize architectural complexity while enabling transactions to be rolled up directly to the network.
Regardless of the chosen approach, deploying Ethereum-based protocols can bring increased TVL to TON, mirroring trends observed in other non-EVM-compatible blockchains.
### Implementation Strategies
Several options exist for integrating EVM capabilities into non-EVM blockchains without developing an internal solution. Acquiring an existing blockchain can be effective, as seen in Venom’s acquisition of Everscale to enhance its commercial prospects. Alternatively, developing an L2 blockchain in collaboration with an L2 solutions provider could present a viable path forward.
### Lessons from Other Non-EVM Blockchains
Identifying consistent patterns linking the type of L2 solution adopted and the commercial success of EVM compatibility is complex due to the unique architectures tailored to each blockchain’s specific properties. The choice of approach may also be influenced by the market positioning of the blockchain. For instance, a sidechain might be preferred over a rollup to maintain the integrity of unique consensus mechanisms and governance models.
Successful implementations of EVM capabilities vary significantly, reflecting the tailored requirements of each blockchain. For TON, prioritizing cost efficiency in transitioning Ethereum-based projects to its network is essential, rather than replicating existing solutions from other blockchains.
### Frequently Asked Questions
EVM capabilities are vital for integrating non-EVM blockchains with existing Ethereum-based DApps and smart contracts. Incorporating Solidity and Ethereum-based development tools into these blockchains is crucial for fostering a developer ecosystem. Furthermore, EVM capabilities facilitate the deployment of Ethereum projects and the onboarding of Ethereum wallet users into the non-EVM blockchain’s DeFi ecosystem.
The benefits of this integration often manifest as increased TVL, a broader user base, and enhanced fee revenue. Generally, two primary options are available: rollups, which bundle multiple off-chain transactions and submit a single proof to the non-EVM blockchain, and sidechains, which operate parallel to the Ethereum mainnet. Additionally, unconventional solutions include proprietary EVM implementations, parachains, workchains, Ethereum wallet smart contracts, and direct deployment of Ethereum projects on non-EVM blockchains.
Noteworthy TVL contributions resulting from EVM capabilities include Aurora ($10.35 million, or 29.7% of NEAR’s TVL), Moonbeam ($40.43 million of Polkadot’s TVL), Kava ($194.89 million, or 24.1% of Cosmos’ TVL), and Lido on Solana ($54.14 million, or 17.2% of Solana’s TVL). Integrations have successfully migrated prominent Ethereum projects to their respective platforms. Ultimately, the choice of integration method will depend on the desired outcome; a rollup may be favored for security and integration, while a sidechain may be better for speed and cost efficiency.
