SECTION 1: Applicant Information
Applicant Name:
Risk Labs Foundation
Project Name:
Across Protocol
Project Description:
Across is a cross-chain bridge for L2s and rollups secured by UMA’s optimistic oracle. It is optimized for capital efficiency with a single liquidity pool, a competitive relayer landscape, and a no-slippage fee model.
Team Members and Roles:
Hart - Founder and CEO
Kevin - Treasurer
Matt - CTO
Melissa - COO
Korpi - Biz dev, financial operations
Ryan - Product Manager
Nick - Tech lead
James, Alex - Full stack
Dong Ha - Front end
Paul - Smart contract
Chase - Data
Dylan - Data
Tim - product design
Amanda - Marketing
Britt - Community
Project Links:
Website
Docs site
Github
Dune
Twitter
Discord
Medium
Forum
Snapshot
Across Audits
Audit containing MerkleDistributor contract (can be found by searching for “MerkleDistributor”)
Contact Information
TG:
Kevin - @kevinchan7
Ryan - @racarman245
Britt - @britt_m42
Twitter:
Kevin - @kevinchan2020
Ryan - @racarac
Britt - @BrittanyMadruga
Email:
kevin@umaproject.org
ryan@umaproject.org
britt@umaproject.org
Do You Acknowledge That Your Team Will Be Subject to a KYC Requirement?:
Yes. Kevin is the point of contact for KYC.
SECTION 2a: TEAM AND PRODUCT INFORMATION
Across is built and maintained by the Risk Labs team, who have been building in the DeFi space for over 5 years now. Risk Labs’ pilot protocol is UMA, known for the Optimistic Oracle (also live on Arbitrum). Across was built and launched by Risk Labs to showcase the power of the Optimistic Oracle. We have supported fast bridging to Arbitrum since we launched in 2021 with no security incidents to date. Across has facilitated over $6 billion in bridge volume with over 3 million transfers. Our average fill time is under 2 minutes, and the cost to bridge 1 ETH is typically less than $1 in bridge fees.
Across was built as an intents-based bridge to be maximally capital efficient for our users. Across users see lower gas fees on transactions as well as lower bridge fees than in competitors. We construct our user incentive programs with the same ethos. This can be demonstrated by our current OP rewards program, which gives users back 95% of their bridge fee in grant tokens when bridging to Optimism. We built out a specific set of rewards contracts to facilitate these types of incentives in a way that can display them for users within our dapp. (see image below)
Since this program started in December, we have seen a 3-4X increase in volume heading to Optimism. Before starting this program, Across supported ~$2M per day to Optimism. After launching this program it jumped to $6M per day. There was a short period where this value went back down due to our V3 upgrade process. However, the bridging volume has since rebounded and continues to increase (see image below). A 3X value is enough to suggest that this volume is organic users rather than farming activity, and we expect these incentives to continue for another 16 months before running out. By providing a 95% rebate on bridge fees, we can get a user to their destination chain for essentially no more than their gas cost, which we are also always striving to reduce.
Is your project composable with other projects on Arbitrum? If so, please explain:
In addition to the Across Bridge, we’ve also recently just launched Across V3 which includes a suite of developer tools to help onboard users from other chains without the need to visit a bridge. Across + (one of our new products) is a composable bridging tool that apps can build on top of. It uses bridge hooks to enable an action after bridging. This could, for example, be used to onboard users into a vault position on Arbitrum using funds currently held on another chain.
Do you have any comparable protocols within the Arbitrum ecosystem or other blockchains?
Across is one of several fast bridging options that support the Arbitrum ecosystem.
How do you measure and think about retention internally? (metrics, target KPIs)
We look at several factors, some of which include market share, volume bridged, number of repeat users, and customer costs incurred (both speed and money).
Relevant usage metrics - Please refer to the OBL relevant metrics chart . For your category (DEX, lending, gaming, etc) please provide a list of all respective metrics as well as all metrics in the general section:
- Daily Active Users: A time series metric representing the daily count of unique addresses interacting with the protocol’s contracts.
- Daily User Growth: A time series metric representing the daily user growth (in addresses) interacting with the protocol’s contracts.
- Daily Transaction Count: A time series metric representing the daily number of transactions interacting with the protocol’s contracts.
- Daily Protocol Fee: A time series data representing the daily total protocol fee generated. For example, swap fees, borrowing fees, etc., comprising all economic value generated through the protocol, contracts, apps, etc., by users.
- Daily Transaction Fee: A time series, daily total transaction fees generated daily by interactions with the protocol’s contracts.
- Daily ARB Expenditure and User Claims: Data on individual ARB incentive claim transactions made by users, as incentivized by the protocol. It should include the timestamp, user address, and the claimed ARB amount. The spent ARB will allow for the normalization of growth metrics.
- Incentivized User List & Gini: The list should include users incentivized by the protocol along with their performance metrics. For instance, if trading volume is incentivized, this would be a list of traders with their respective trading volumes. If liquidity providers are incentivized, it would include a list of LPs and their liquidities in USD. Protocols should also strive for more uniform engagement levels across a wide user base for long-term sustainability, which will be measured through a gini coefficient across reward recipients.
For each asset:
- TVL: A daily time series expressed in USD.
- Bridging Volume: A daily time series, also measured in USD.
- List of Liquidity Providers: A list of current and past participants who have provided liquidity during the incentivized period of the protocol. The list should include LP addresses, their current liquidity in USD, time-weighted liquidity in USD, and the duration of liquidity provision.
- Net Asset Flow: A time series of the net inflow/outflow from a source and destination chain across the funding period timeline.
Do you agree to remove team-controlled wallets from all milestone metrics AND exclude team-controlled wallets from any incentives included in your plan:
Yes
Did you utilize a grants consultant or other third party not named as a grantee to draft this proposal?
No
SECTION 2b: PROTOCOL DETAILS
Is the protocol native to Arbitrum?:
Yes, in so far as a bridge can be.
On what other networks is the protocol deployed?:
Optimism, Polygon, Base, zkSync mainnet, Ethereum mainnet (others may go live by the time this grant is accepted)
What date did you deploy on Arbitrum mainnet?:
V1 deployment Nov 21, 2021 tx here
V2 upgrade deployed May 23, 2033 tx here
V2.5 upgrade deployed Apr 24, 2023 tx here
V3 upgrade deployed Feb 20, 2024, tx here
Do you have a native token?:
We have a protocol token, ACX, that is mostly used on Ethereum mainnet (no meaningful presence on Arbitrum).
Past Incentivization:
We don’t have any discontinued incentives programs to report.
Current Incentivization:
We currently offer a bridging incentive that is designed to give users a 95% rebate on bridge fees (not gas fees) on all bridge transactions to Optimism. Details on this have been provided above. We also currently offer ACX incentives for bridge liquidity providers on Eth mainnet via our reward locking program.
Have you received a grant from the DAO, Foundation, or any Arbitrum ecosystem-related program?
No
Protocol Performance:
Across is one of the critical user onboarding protocols for the Arbitrum ecosystem. Across regularly supports around $10 million in daily transfers to Arbitrum, with a cumulative volume exceeding $1.6 billion. In the past 30 days alone, we have seen $325 million to Arbitrum.
Across accounts for about 25% of the fast bridge volume going to Arbitrum today, for the tokens and routes we support.
If we look at aggregator activity, we can effectively filter out farming activity and get a better idea of organic user flow. Across domintes in head-to-head competition in aggregators like Lifi and Socket, where Across currently has about 50% of the volume going to Arbitrum. When regular users need to bridge their assets based on price, speed, and security (and not farming a potential bridge token airdrop) the data shows that they opt for Across.
Across wins head-to-head in aggregators because it is 1) secure 2) the fastest and 3) the cheapest. We are able to accomplish this because of our unique intents-based design.
Security First
Across is the largest bridge in the ecosystem to use a battle-tested optimistic settlement mechanism. Across uses UMA’s optimistic oracle to confirm that transactions on all the chains are correct. If there is a transaction that is incorrect, it will be disputed and resolved by UMA tokenholders. It only requires a single honest actor to detect fraud. This mechanism has stood up to multiple attempted exploits with no problems at all. Our relayer model (described more below) also provides an extra layer of security for users because the relayers are the ones who take on any finality risk during the optimistic settlement window. It’s also worth noting here that Across only deals with canonical tokens (no wrapped/synthetics that would extend user risk unnecessarily).
Speed
Across is able to offer lightning-fast transfers because instead of using messaging, mint and burn, or native swap mechanisms, Across uses relayers to fill orders and LPs to reimburse relayers. This model looks more like a lending model where relayers compete on speed for the opportunity to lend out their funds. This creates a competitive ecosystem of relayers that are always pushing the limits on innovation to continuously outpace their competition. The image below shows how Across compares to other bridges on median fill times to Arbitrum for the tokens and routes we support.
Fees
Bridge fees should be considered in two categories - liquidity/protocol fees and gas fees.
Gas
We put out a full analysis on gas fees here for those who want to read deeper into this specific category. A good takeaway from the article is that Across is particularly well suited to save users on transfers originating on mainnet, where we are up to 80% cheaper than competitors. Because of this, we think that we are particularly well positioned to help facilitate the migration of users away from L1 and towards L2s.
Bridge Fees
Across was designed with capital efficiency in mind in order to make sure we could provide our users with the lowest fees. Unlike our competitors who use an AMM model, Across fees don’t suffer from slippage or arbitrage. Our fees use a lending model that responds to bridge pool utilization. Additionally, we’ve optimized capital rebalancing and recycling to make sure that funds are not tied up longer than necessary or stuck in a 7-day transit cycle. And finally, we can keep our utilization within normal ranges by having a single liquidity pool rather than fragmented liquidity across each supported chain. This combination typically allows us to provide the lowest fees to Arbitrum across our supported tokens and routes. We have been experiencing uncommonly high volumes since our launch of V3, causing our liquidity utilization to remain high. Even in these circumstances, our fees have managed to remain competitively low.
Projected Savings for this Grant
An added benefit to having the lowest bridge fees is that Across will be able to facilitate the transfer of MORE funds into Arbitrum using LESS $ARB than our competitors, while also covering more of our users’ cost to migrate into the space. The chart below shows the median bridge fees for transfers TO Arbitrum across various bridges and routes, including the cost of gas. Below each column, you can also see the expected amount of ARB that would be distributed by each protocol using this type of rebate system. It should be clear here that saved funds for users result in saved funds for Arbitrum.
Protocol Roadmap:
Across is dedicated to providing users with a safe, fast, and cheap bridging option to an increasing number of chains. As we find ourselves in an increasingly multi-chain world, we are also starting to plan for ways to enhance the user experience in navigating that future. We believe the key to success in this space is to focus on these 5 main areas of growth:
- New chains
- Ease of integration for bridge hooks
- Capital efficiency improvements
- Cross-chain intent settlement system
- System robustness on scaling
Audit History & Security Vendors:
All of Across’ audits have been performed by OpenZeppelin. A full list of audits can be found here. We handle all of our security in-house, so there are no vendors or advisors to list out. Our bug bounty program is detailed here.
Security Incidents:
No, Across has never been exploited.
SECTION 3: GRANT INFORMATION
Requested Grant Size:
1,000,000 ARB
Justification for size of grant:
To determine the size of the grant we should request, we chose to benchmark against the volume increases that we’ve seen so far with our OP incentives program. As detailed above, we expect to see at least a 300% increase in volume heading to Arbitrum during the lifetime of this grant.
Applying that percent increase to Across’ 90d Volume of $638.6M to Arbitrum, yields an estimated volume during a 3-month ARB reward period of $1.92B. You can see more on Across’ performance in the protocol performance sections above.
Assuming an average total sender fee (bridge fee + origin gas) of 0.15%, and applying an ARB rebate for 95% of total sender fee, yields total rewards of $2,730,015, or 1,365,000 ARB at a current price of ~ $2.00/ARB.
During the proposal review process, our advisor recommended we reduce the size of the request due to how oversubscribed this grant is. In the interest of ensuring the best possible results for the LTIPP, we believe it is reasonable to reduce the amount asked to 1M ARB. This will likely result in running out of funds before the end of the program but should allow it to run long enough to gather meaningful data.
Grant Matching:
N/A
Grant Breakdown:
This grant will be used to subsidize up to 95% of bridge fees for users heading TO Arbitrum in the next 3 months. The cost of bridging includes both a gas cost as well as a bridge fee (which is used to compensate LPs). We plan to use the entirety of this grant to offset the cost of bridging for users entering the Arbitrum ecosystem, while also ensuring that these rewards are not farmable. In other words, there will not be a net profit for bridge users in this program, but we will make it nearly costless for users to enter Arbitrum during this period.
Funding Address:
0xd16D904b68429b93F1DFCD837F61AeDCd224e8F4
Funding Address Characteristics:
3/5 multisig with private keys securely stored
Treasury Address
0xd16D904b68429b93F1DFCD837F61AeDCd224e8F4
Contract Address:
We will be using our MerkleDistributor contract to hold and distribute these incentives. The Arbitrum deployment of this contract that is dedicated to this program can be seen here.
SECTION 4: GRANT OBJECTIVES, EXECUTION, AND MILESTONES
Objectives:
The primary objective of this grant is to onboard users into the Arbitrum ecosystem as seamlessly as possible. A thriving L2 ecosystem is only possible if we also have a competitive and robust network of bridges to support connections between chains, and we believe that we can provide the most competitive bridging solution for users in terms of both speed and cost.
Execution Strategy:
We will be using our MerkleDistributor contract to hold and distribute these incentives. This contract has been audited (link above) and has been in use within Across on mainnet for nearly a year to distribute ACX rewards through our referral program. A new MerkleDistributor contract is deployed on Arbitrum for the purpose of this program. You can see more on the MerkleDistributor on Github here (GitHub - across-protocol/merkle-distributor). The mainnet deployment can be seen here (AcrossMerkleDistributor | Address 0xE50b2cEAC4f60E840Ae513924033E753e2366487 | Etherscan).
Execution will also include updates to the Across UI to support this new rewards stream, which is handled by Risk Labs. We will collect data on bridge transactions TO Arbitrum and distribute rewards on a FCFS basis, not to exceed our awarded grant. Each user will be able to see their specific reward distribution within the Across UI when their wallet is connected.
Key Performance Indicators (KPIs):
- Total volume transferred
- Total Users
- Number of new users
- Amount of ARB rewarded per volume to Arbitrum
Grant Timeline and Milestones:
This incentive is intended to run for the full duration that is indicated in the scope of this grant program. The rebate program can begin within 2 weeks of grant approval and will run for 3 months. Rewards are accrued over a month and become claimable to users every month.
How will receiving a grant enable you to foster growth or innovation within the Arbitrum ecosystem?:
By providing a 95% rebate of the cost to bridging, we hope to maximize the amount of funds available to end users within the Arbitrum ecosystem. Additionally, a rebate of this nature provides folks with ARB that they can then use to participate in the other protocols that are using this grant as an opportunity to grow the ecosystem.
For example, a user may choose to bridge with Across into Arbitrum and then use their ARB rebate to provide liquidity in GMX.
Across has a history of fostering this kind of growth and innovation within Arbitrum, which can be seen in our “Ape Into Arbitrum” campaign. This was a month-long campaign designed to celebrate the diversity of opportunities in the Arbitrum ecosystem. Each of our featured protocol guests participated in an AMA, received an article spotlight (like this one), a YouTube video spotlight, and was included in a our Galxe campaign, which can be seen here..
Do you accept the funding of your grant streamed linearly for the duration of your grant proposal, and that the multisig holds the power to halt your stream?
Yes
SECTION 5: Data and Reporting
Is your team prepared to comply with OBL’s data requirements for the entire life of the program and three months following and then handoff to the Arbitrum DAO? Are there any special requests/considerations that should be considered?:
Yes. We do an extensive amount of data harvesting as a team already, and we are prepared to extend that to include an addition to our existing Dune Dashboard infrastructure to accommodate the reporting requirements of this program. You can find our dune dashboard in the links section of this proposal above.
Does your team agree to provide bi-weekly program updates on the Arbitrum Forum thread that reference your OBL dashboard?
Yes. We are more than happy to provide bi-weekly updates on the Arbitrum Forum thread to share the details of this program.
Does your team agree to provide a final closeout report not later than two weeks from the ending date of your program?
Yes
Does your team acknowledge that failure to comply with any of the above requests can result in the halting of the program’s funding stream?:
Yes