Synapse is a universal cross-chain protocol connecting EVM and non-EVM chains via generalized message passing. It supports cross-chain asset movements, smart contract calls, and NFTs. By leveraging Synapse, developers can build natively cross-chain AMMs, lending platforms, derivative markets, yield aggregators, and more. Synapse started as a stable swap protocol on BNB Chain called Nerve and evolved into a cross-chain bridge. In its current iteration, Synapse is best known for its emphasis on building a home for natively cross-chain applications via an easy-to-use SDK and the soon-to-be-launched Synapse Chain.
Some of Synapse’s best features include:
Multiple Transaction Types — Synapse was initially deployed as a liquidity network specializing in moving ETH and stablecoins across blockchains. Synapse users can move assets by locking native assets and minting wrapped xAssets on the destination chain. Synapse also allows users to move stablecoins at low cost by moving “nexus” assets between Synapse-hosted liquidity pools. Additionally, Synapse now facilitates cross-chain messaging between chains — meaning arbitrary data like contract calls can be transmitted and executed on two separate chains, unlocking a ton of potential for interoperability between dApps. In this article, we focus on the latter (message passing) rather than the former (liquidity networks).
Optimistic Security Model — Synapse validates cross-chain transactions with the help of an optimistic security model. Entities (guards) observe cross-chain messages and submit fraud proofs if a malicious state is proffered. In this case, only 1 of N number of guards must act honestly for Synapse to work correctly, which means the cost to attack the network is unknown, as opposed to traditional PoS models wherein the cost for attacking a system is the cost to bribe a certain percentage of the validator set.
Access to Cosmos Ecosystem — Canto, a Cosmos-based DeFi chain, was added to Synapse’s liquidity network in late November 2022. With the connection, Synapse is one of three major bridges (Axelar, Gravity) to connect the EVM world with Cosmos.
Developer Toolkit — Developers looking for a “plug and play” solution for bridging can directly integrate cross-chain token and liquidity transfers into the front end of their application via the Synapse SDK. Additionally, Synapse offers a widget and API for developers to implement.
Synapse Chain — Built as an Optimistic Rollup to Ethereum, Synapse Chain is an EVM-compatible blockchain designed to serve as a sovereign execution environment for cross-chain developers to utilize when deploying cross-chain applications. Synapse Chain is currently in testnet, but is on the books to launch sometime in 2023, with extensive plans to utilize SYN as a PoS-type bonding mechanism.
Additionally, Synapse enjoys the following network effects:
Usage — Overall, Synapse has experienced $12.4 billion in total bridge volume since inception and has raked in $20 million in revenue during the same time period.
SYN token holders — SYN is a top 200 token with a market capitalization of roughly $120 million.
Chain Support — As of February 2023, Synapse supports 17 chains!
How It Works — Transaction Lifecycle
To be fully understood, the Synapse message-passing architecture needs to be split into two parts.
Synapse Chain
As described above, Synapse Chain is an Optimistic Rollup of Ethereum designed to host cross-chain applications and other cross-chain primitives. Like most rollups, Synapse Chain is EVM compatible, relies on Ethereum for security, and executes blocks via a sequencer. It acts as a single execution layer for business logic to be deployed and then propagated across chains. In other words, transactions can be initiated on Synapse Chain and then sent out to any blockchain connected to the Synapse Protocol network by utilizing Synapse’s cross-chain message passing system. In essence, Synapse Chain is a bet that cross-chain dApps will want a home base to execute transaction logic. For example, instead of spreading complex business logic across ten blockchains, SynapseChains gives developers a single execution environment to work from.
As explained in the graphic below, the aim is for different dApps to communicate with each other and execute transactions using Synapse Chain. In reality, Synapse Chain has two roles: 1) it is a translator of messages coming from foreign chains, and 2) it’s a way to settle dApp application logic and transactions on Ethereum.
Now, this leads to the second part of Synapse’s architecture: how the cross-chain message passing actually works.
2. Cross-Chain Message Passing
As mentioned above, Synapse is now secured via optimistic verification. Transactions on Synapse are assumed to be honest. Off-chain actors, therefore, are needed to watch and submit fraud proofs during a set period of time (aka an optimistic window) if they catch a malicious transaction. In this case, the security of Synapse is reliant upon the fact that a single off-chain actor is watching cross-chain transactions at all times and responding honestly within the optimistic window. Notably, developers can specify how long the optimistic window is based on their own use case and opinion on what the tradeoff between latency and security should be.
Synapse’s optimistic verification process is designed around four actors:
Notaries — signs merkle roots on each chain
Broadcasters — forwards updates from home contracts to replica contracts
Guards — observes cross-chain messages and submits fraud proofs
Executors — posts transaction on the destination chain after the optimistic window finalizes
Notably, this verification system will be dependent on SYN bonding. Going forward, Notaries within Synapse will be required to bond (another word for “stake”) SYN in order to attest to outgoing transactions. This bonding will allow the network to slash Notaries with a history of malicious behavior. Guards will also be required to bond SYN in order to prevent spam. As of now, however, Synapse has yet to provide details on how much SYN is required to become a Notary or Guard.
Overall, a transaction on Synapse is quite simple:
A user or application submits a transaction on the source chain, which is routed to Synapse’s messaging contracts
Messaging contracts hash the message and adds it to a merkle tree
The Notary signs the attestation (aka the proof an interaction happened on the source chain) with the new merkle root
Guards must also sign the attestation as a proof of liveliness before the attestation is forwarded (this attestation lets Synapse know for a fact that a guard is monitoring the chain for fraud)
Broadcasters forward the attestation to the destination chain
Guards observe the attestation and check to make sure it is not malicious
Once the optimistic window has closed, the transaction is considered valid, and the Executor confirms the transaction on the destination chain.
Synapse offers the following security features:
Audits — The current iteration of the Synapse Bridge has been audited by PeckShield. The team confirmed that more audits will be in order after the upgrade to the next iteration of Synapse Bridge. Until then, users can analyze the Synapse codebase on Github. Additionally, its stableswap AMM contracts have been audited by Certik, OpenZeppelin, and Quantstamp.
Optimistic Verification — Instead of relying on a third party multi-sig, Synapse relies on a 1/N verification system that only requires a single guard to act honestly. Entities in this Optimistic system will have their SYN slashed if they act maliciously. Ultimately, the optimistic verification process makes the cost of attacking Synapse unknown to any would-be threat.
Governance — Synapse Protocol governance votes require a majority of voters and a minimum quorum of 10,000,000 SYN.
Synapse Chain and Ethereum — Synapse Chain is an optimistic rollup based on Ethereum. Once launched, this means Synapse Chains transactions will ultimately be settled on Ethereum mainnet and receive the same security guarantees as other mainnet transactions.
Slashing — Notaries, Guards, Executor, and the Broadcaster can all be slashed in scenarios where they allow fraud to occur (on accident or on purpose).
Trust Assumptions
Synapse makes the following trust assumptions:
1 honest guard — When operating under an optimistic model, protocols like Synapse rely on the fact that there is always a single honest watcher at all times. If no Guard is available to sign an attestation on the source chain, transactions will be paused until a Guard comes back online.
Value of SYN — The slashing mechanism proposed for entities within the optimistic verification model assumes that the value of bonded SYN and the potential of losing that value via slashing outweighs the gains an entity could receive by acting maliciously. If the value of SYN were to drastically decrease, there could be an edge case where the risk of slashing is worth the reward of acting maliciously.
Governance — With a minimum of 10,000,000 SYN tokens (about 5% of total supply) necessary to change the protocol and a 50% + 1 vote policy, it is assumed that governance entities will vote for the health of the protocol. Furthermore, it is assumed that the price of SYN will not decrease to the point that it actors are incentivized to purchase SYN and execute malicious proposals.
Sequencer — The current iteration of Synapse Chain utilizes a centralized sequencer to post transactions, just like many other chains. If this sequencer were to experience downtime, Synapse Chain could be affected. Synapse is following a similar path to decentralizing the sequencer as Arbitrum and Optimism, a more robust roadmap will be released.
Semi-Permissioned Entities — The Executor and Broadcaster will be permissionless when Synapse Chain launches. However, its launch on mainnet will have permissioned Guards and Notaries. The team plans to open source an implementation for each entity, with documentation on how to operate soon after mainnet launch. Thus, anyone will be able to run these services at some point soon.
