Messari Research Report: Comprehensive Understanding of Particle Network

Title of u Original: "UNDERSTANDING PARTICLE Network: A Comprehensive Overview"

Author: AJC

Compilation: Deepflow

Main pointwork

• particle network is developing a modularization L1 blockchain

  , by implementing chain abstraction, enables each user to have a single, unified on-chain address and balance across all blockchains.

• Through its L1 blockchain, Particle Network implements three core functions:

  Universal Accounts, Universal Liquidity, and Universal Gas. Each feature provides a unique use case by eliminating manual multi-chain interactions from the user experience.

• Particle Network also implements double

  staking through Babylon and aggregates data availability. Double staking bootstraps crypto-economic security from BTC, while aggregated data availability avoids single points of failure in network data availability.

• Particle Network’s public testnet went online on May 2, along with a rewards program called Particle Pioneer.

  As of this writing, 1.3 million accounts have been registered and 6.71 billion PARTI points have been distributed.

Quote

One of the few constants in the crypto industry is the ever-increasing number of blockchains. Whether it’s a Layer-2 (L2) rollup on Ethereum, an L1 replacement, or an application-specific chain, it seems like there’s a new blockchain coming online every month. While this ever-expanding set of blockchains offers users a variety of customization options, a multi-chain ecosystem also has its drawbacks for both developers and users. Developers not only have to worry about their application or product, but also which blockchain ecosystem it will be deployed on. For users, more chains mean more complexity and fluidity dispersion, making the user experience (UX) far less simple than Web2.

To truly compete with Web2 in terms of adoption, Web3 needs to get to the point where the average user has no idea which blockchain they are transacting on - a concept known as chain abstraction. To this end, Particle Network is developing a modular L1 blockchain that enables chain abstraction by enabling each user to have a single, unified on-chain address and balance across all blockchains.

Background

Particle Network was announced in April 2022 and was co-founded by Pengyu Wang and

Tao Pa

. Both founders have experience in mobile game development, and they created Particle Network to provide backend infrastructure to developers. To date, Particle Network has raised $25 million across four rounds of funding, with notable investors including Spartan Group, Gumi Crypto, Animoca Ventures, LongHash Ventures, and Alibaba Group. On May 2, 2024, Particle Network’s incentivized L1 testnet was launched, providing point rewards through the Particle Pioneer platform. Particle Network’s mainnet is scheduled to launch in the second half of 2024.

Network Functions

Through its L1 blockchain, Particle Network implements three core functions: universal accounts, universal liquidity, and universal gas. Each feature is designed to enable chain abstraction by eliminating manual multi-chain interactions from the user experience.

Universal Account

(Image source: Particle Network)

Universal accounts allow every user to have a single, unified address, balance, and interaction point, regardless of the application or underlying chain where the funds are located. Additionally, Universal Accounts are compatible with both EVM and non-EVM networks, even those with limited programming capabilities, such as Bitcoin. Particle Network achieves this by using ERC-4337 smart contract wallets (smart accounts). Smart Accounts offer greater flexibility, programmability, and security than typical Externally Owned Accounts (EOA). Additionally, universal accounts improve upon typical smart accounts by making them compatible across chains. Therefore, Particle Network users only interact with the unified balance and not directly with the account.

For example, let’s say a user wants to mint an NFT on L2 rollup, but all their ETH is on the Ethereum mainnet. To use EOA, users need to sign the following transaction:

1. Approval of the bridge contract

2. Bridge ETH from Ethereum to L2

3. Approval of the minting contract

4. Minting NFT

However, if the user is using a universal account, they only need to sign one transaction instead of four.

Particle Network is also developing a universal WaaS SDK, which will make it easy for any application to integrate universal accounts into their products. In addition, Universal WaaS will allow applications that have integrated Particle Network’s existing wallet abstraction service, modular smart wallet as a service, or BTC Connect to automatically upgrade any existing smart account to a universal account.

Universal Liquidity

Universal Liquidity is the underlying layer of the cross-chain aspect of Particle Network, enabling universal accounts to have a single balance on all supported chains. Simply put, Universal Liquidity is Particle Network’s cross-chain bridging solution. Universal Liquidity therefore allows users to trade on any supported blockchain, regardless of which blockchain the user’s funds are on.

For example, let’s say a user wants to buy SPL tokens on Solana, but all their funds are on Ethereum. With Particle Network’s universal account, users only need to sign a transaction to complete this purchase. This is because in this case, Universal Liquidity handles the actual transfer of funds from Ethereum to Solana. These transactions (UserOperations) are executed on behalf of users through Particle Network’s distributed network of Bundler nodes. Ultimately, Universal Liquidity aims to automate cross-chain activity on a transaction basis. Typically, cross-chain activity involves multiple transactions across multiple blockchains. Through universal liquidity, the user experience is simplified, allowing users to conduct cross-chain activities in a single transaction.

General Gas

All multi-chain frameworks must overcome the gas payment challenge. Particle Network's Universal Gas aims to resolve this complexity by abstracting away specific gas tokens. Through Particle Network’s Paymaster, users can pay for gas on transactions using any supported token on any supported chain. For example, USDC on Ethereum can be used to pay gas fees for transactions on Solana.

When transacting via a universal account, Particle Network will prompt users to select the token they wish to use to pay for the associated gas fees. Users can choose multiple tokens, even tokens across multiple blockchains, to pay gas fees. These tokens are then transferred to Paymaster, exchanged for Particle Network’s native PARTI token, and then used to settle related transactions on Particle Network. Bundler nodes then incentivize execution of relevant transactions.

Technology

Particle Network is a modular L1 blockchain built using Cosmos SDK and CometBFT. The Cosmos SDK is an open source software development kit (SDK) for building sovereign and public PoS blockchains. The Cosmos SDK is used to build custom application layers or state machines, while CometBFT is used to securely replicate that state machine across all nodes in the network. CometBFT is an application-agnostic engine that handles the network and consensus layer through two main components: the

• consensus algorithm, known as Tendermint.

• Socket protocol, the Application Blockchain Interface (ABCI).

Tendermint validates requests on the source chain and confirms changes on the target chain. Its consensus provides instant finality and Byzantine fault tolerance. In addition, Particle Network also uses Berachain’s BeaconKit to implement an EVM-compatible execution environment.

Modules

Particle Network’s core functions (universal accounts, liquidity and gas) are implemented through three main modules: Master Key Storage Center, Decentralized Message Network and Decentralized Bundler.

Master Key Storage Center

The Master Key Storage Center module serves as the central source of truth on the Particle Network. It works by synchronizing common account state changes on all supported blockchains, maintaining state consistency across the network. This module records any changes that occur on the Particle Network, such as users adding signers to their universal account.

Decentralized Message Network

Particle Network’s Decentralized Message Network (DMN) module relays successful UserOperations (transactions of universal accounts) on external blockchains to Particle Network. DMN is supported by a system of Relayer Nodes, which is a message center node on the Particle Network. In addition, DMN works in conjunction with the master key storage center to pass state data to and obtain data from supporting blockchains. DMN is powered by Hyperlane, an interoperability layer that allows supported blockchains to connect to each other and communicate seamlessly.

Decentralized Bundler

The decentralized Bundler module is responsible for executing UserOperations, which is the core component of universal liquidity. This module consists of a distributed network of Bundler nodes. Bundler nodes perform transactions on behalf of universal accounts, such as purchasing NFTs or exchanging tokens. Bundler nodes achieve this by interacting with liquidity providers. The liquidity provider in this case is not a traditional decentralized exchange (DEX) liquidity provider, but a liquidity pool across multiple chains that can be used to bridge funds.

For example, let’s say a user wants to buy SOL on Solana, but all their funds are split equally between Ethereum, Optimism, and Arbitrum in the form of USDC. A universal account signs a single transaction to achieve the following functions:

1. Particle Network’s L1 handles UserOperations associated with signed transactions.

2. Bundler nodes relay UserOperations to liquidity providers, sending USDC on Ethereum, Optimism and Arbitrum to the corresponding liquidity providers.

3. After receiving the USDC, the liquidity provider sends the USDC on Solana to the user’s account.

4. Bundler nodes execute transactions on Solana DEX that exchange USDC for SOL on behalf of users.

Finally, Watchtower Nodes ensure that these different interconnect modules are all working properly. They achieve this by providing either a proof of execution or a proof of fraud for every block produced every epoch on the Particle network.

Double Pledge

Particle Network uses the Delegated Proof of Stake (DPoS) consensus mechanism and has a double pledge system. Once online on mainnet, Particle Network will utilize two different sets of validator nodes: one secured by Particle Network’s native token, and the other secured by BTC via Babylon’s Bitcoin staking protocol. Two sets of verification nodes will independently reach consensus. If any of these sets of validating nodes deem a block invalid, the block will not be finalized. The purpose of the double-collateral system is to bootstrap cryptoeconomic security through proven crypto-assets like BTC and the network’s native tokens.

Aggregated Data Availability

One challenge facing blockchain is data availability. Data availability refers to ensuring that all data required to verify transactions is accessible and that all nodes have access to the state of the chain. Whenever a blockchain uses only one data availability solution, a single point of failure is introduced. If the data availability solution fails, the nodes of the blockchain will not be able to guarantee the validity of the blocks. Therefore, Particle Network leverages Aggregated Data Availability (AggDA), a unique approach that leverages multiple data availability networks: Celestia, Avail, and NEAR DA.

For each block generated on the Particle Network, data is published randomly via:

• Selective Publishing - Data related to a block is only published to a supported data availability solution. This approach helps reduce the cost of publishing data.

• Redundant Publishing - Block-related data is published to all supported data availability solutions. While this approach is more expensive than selective publishing, it spreads the risk of any individual data availability solution not working properly.

Public Testnet

Particle Network’s public testnet will be launched on May 2, 2024. The testnet demonstrates two core features of Particle Network: universal accounts and universal gas. Users can register for the testnet and create a universal account through an EVM wallet such as MetaMask or Rainbow. In addition, through Particle Network’s BTC Connect, users can also use a Bitcoin wallet such as Unisat or OKX to control universal accounts.

Users can test the universal Gas function of Particle Network by depositing native tokens to supported testnet networks (such as Ethereum’s ETH, BNB Smart Chain’s BNB, etc.). Once deposited, these tokens are automatically converted into Universal Gas (USDG). Users can use USDG to send transactions on the testnet. As of this writing, 9.6 million transactions utilizing USDG have been conducted on Particle Network’s testnet. In addition, there have been more than 121.5 million user operations (UserOperations) related to these transactions. It is important to note that this is an early version of the universal Gas implementation and may differ on mainnet.

Particle Pioneer

The Particle Pioneer program is designed to encourage users to participate in the Particle Network testnet. The program rewards testnet users with PARTI points, which make addresses eligible for upcoming airdrops, bonuses from the People’s Launchpad, and whitelist spots for various ecosystem projects. People’s Launchpad is a project within the Particle Network ecosystem designed to bootstrap projects and applications within the ecosystem.

Addresses earn points by sending transactions and paying gas fees with USDG. Rewards addresses 50 points per transaction, up to a maximum of 100 transactions per day. Additionally, addresses can earn extra points for daily check-ins. The address that sends transactions for multiple days in a row will earn more points.

Particle Pioneer also allows addresses to earn additional points through Particle Pioneer NFTs, which are reserved for active addresses in the testnet and addresses that have participated in previous events. There are three types of NFTs, with associated points boosts ranging from 2% to 30%.

To date, 1.3 million accounts have registered to participate in the Particle Pioneer program and 6.71 billion PARTI points have been distributed.

Roadmap

With the launch of the Particle Network testnet in May, the protocol is one step closer to the final mainnet launch. Particle Network’s roadmap includes the following:

• Q2 2024 - Adding general liquidity and modular nodes to the public testnet

• Q3 2024 - Mainnet V1 goes live, including Universal Accounts, Universal Liquidity and Universal Gas

• Q4 2024 - Testnet launch for double staking and aggregation data availability

• 2025 - Mainnet V2 online, supporting double staking and aggregation Data Availability

Competitive Landscape

Chain abstraction is the ultimate solution to two major problems in the blockchain industry. The first problem is that multi-chain frameworks inevitably lead to the dispersion of liquidity and users, creating isolated ecosystems. The second problem is that externally owned account (EOA) wallets provide a poor user experience that cannot match the seamless interaction of Web2 applications. Solutions to these problems have largely been developed independently: bridging protocols, for example, are used to connect siled blockchains, while smart contract wallets enhance the user experience and feel more like Web2.

Chain abstraction integrates these solutions, combining the best of both into one product. Traditionally, protocols and teams have focused on one solution or the other, but newer projects, such as Particle Network, are increasingly committed to delivering both, providing a more cohesive and efficient user base experience.

NEAR

NEAR is a multi-purpose L1 smart contract platform that provides chain abstraction services. NEAR’s account abstraction service allows users on NEAR to sign transactions on other chains such as Ethereum and BNB Smart Chain (more blockchains will be supported in the future). NEAR’s account abstraction service leverages the MPC network and chain signatures, as well as the multi-chain gas relay, a mechanism that enables gas payments and transactions to be made on other blockchains.

Instadapp’s Avocado

Instadapp’s Avocado platform is a smart contract account compatible with multiple EVM network-enabled smart contract accounts, including Ethereum, Polygon, Optimism, Arbitrum, Avalanche, BNB Smart Chain and Gnosis Chain. Similar to Particle Network, Avocado abstracts the underlying chain from the user experience. Additionally, Avocado implemented a Paymaster gas tank that enables users to pay for all gas fees in USDC. One major difference is that Avocado only integrates with EVM networks, while Particle Network will also integrate with non-EVM networks.

XION

XION is a modular L1 blockchain designed to create a "universal abstraction" layer to enable a seamless Web3 user experience. Universal Abstraction is a comprehensive infrastructure solution that directly integrates accounts, signatures, fees and interoperability at the protocol level. XION’s “Meta Accounts” product is a smart contract account solution similar to Particle Network’s universal accounts. However, Meta Accounts initiate cross-chain transactions from XION’s L1, while Universal Accounts initiate cross-chain transactions from the source blockchain, which are then relayed and further coordinated by Particle Network’s L1. XION is currently in the testnet stage and plans to launch the mainnet in 2024.

Summary

Particle Network meets the needs in the blockchain field by solving liquidity fragmentation and user experience issues in multi-chain ecosystems. Through its modular L1 blockchain, Particle Network provides universal accounts, universal liquidity, and universal gas to enable chain abstraction and simplify user interactions on different blockchains. Since its launch in April 2022, Particle Network has launched its incentivized L1 testnet and received funding from high-profile investors. The team plans to launch the mainnet in the second half of 2024. In addition, Particle Network's underlying technology includes Cosmos SDK, CometBFT and various innovative modules to achieve seamless cross-chain transactions and status synchronization.

The launch of the public testnet in May 2024 demonstrates the functionality of universal accounts and universal gas. In the future, Particle Network plans to integrate general liquidity and modular nodes. The mainnet is scheduled to go online in the third quarter of 2024, and more features will be launched in 2025. Competing with projects like NEAR, Instadapp’s Avocado, and XION, Particle Network’s comprehensive approach to chain abstraction and dual-staking systems makes it a strong contender in the chain abstraction design space.

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