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Since the inception of our fund II, our thesis has been that it is impossible for one blockchain or one ecosystem alone to encapsulate all the needs of Web3. Hence the future is inevitably multi-chain. Why the obsession with multi-chain? History and nature have taught us that in a world that is constantly in flux, the stable state is plurality, and the optimal state is specialised symbiosis. Just as the world fragments into empires, countries, provinces, neighbourhoods, families, and individuals; Just as nature fragments into habitats, species, organs, cells, and cellular organelles — So will blockchains fragment to form a multi-chain, modular mesh.
The emergence of specialized chains has created unprecedented opportunities but also introduced significant friction in cross-chain composability. History shows us that removing friction points in technology adoption – whether it's the internet's protocol stack or mobile payment systems – leads to exponential rather than linear growth.
In early 2023, we published an extensive analysis of the blockchain interoperability landscape that identified three dominant approaches:
Along with the trust assumptions, we also focused on 2 different approaches to integration: Point-to-Point and Hub and Spoke**.** Point to Point is relatively difficult to scale but provides more flexibility to customize configurations, if needed. Hub and Spoke on the other hand requires intermediate re-execution. ****We contended that in the future, cost of generating ZK proofs will decrease, blockchains will become more zk-friendly and “Trust code/math” category will mature and we will see a plural future where multiple approaches co-exist.
Since 2022, we've witnessed a technological revolution in Zero-Knowledge Proofs that has fundamentally accelerated trust minimzed interoperability:
While ZK technology has matured significantly, the blockchain ecosystem has become increasingly fragmented:
The convergence of maturing ZK technology and increasing chain specialization has created a unique market opportunity. Users and developers alike seek an interoperability solution that's fast, cost-effective, and intuitive. This is where Union steps in. Through innovations like trustless verification, state lenses, and intent-based bridging, combined with its scalable architecture and universal settlement capabilities, Union is tackling the interoperability challenge from first principles. It's not just about connecting chains; it's about making cross-chain interactions as seamless as using a single chain.
Union's approach to interoperability stands out through its innovative use of ZKPs, BLS signature aggregation and Inter-Blockchain Communication (IBC) style light client approach:
One of Union's most revolutionary innovations is the introduction of state lenses, which allows Union to adopt Hub and Spoke as well as Point-to-Point architecture:
Union's architecture enables a sophisticated intent-based bridging system that addresses one of the key challenges in cross-chain interactions – finality lag:
Union adopts a light client-based bridging approach. Just light clients do not take into account attacks like Censorship Attacks, Block Reorganizations and Liveliness Failures. Union leverages IBC standard to correctly handles these cases. The extensible light client architecture transforms it into a universal settlement layer for all rollups. :
Our investment in Union represents our conviction in three key principles:
Beyond the technological innovation, our conviction in Union is deeply rooted in the exceptional team driving it forward. Since May 2023, we've witnessed their remarkable execution capabilities first-hand. Karel's technical leadership as former CTO at Composable Finance, combined with his contributions to NEAR and CosmWasm, provides the deep expertise needed for bridging ZK technology and IBC. What truly sets the team apart is their visionary approach – they understand not just the technical challenges, but the importance of ecosystem-driven and UX focused development. Open sourcing of Union’s codebase is a good example of their commitment to the open, collaborative spirit that drives innovation.
As chain specialization increases, Union's infrastructure becomes increasingly crucial. By leveraging trust minimized security approach while maintaining focus on cost, speed and ease of use, Union is laying the groundwork for a cohesive multi-chain, modular mesh.
Union has processed over 1.7mn transactions on testnet, transferring over 2mn packets. Union has also announced partnerships with key ecosystems and projects like Polygon AggLayer, Movement Labs, Berachain, Xion, Arbitrum, Scroll, Secret Network, Skip Protocol etc. Through its fellowship program, Union is incubating the next generation of cross-chain applications and use cases.
We're proud to support Union in this mission and excited to see how their innovations will help shape the future of plurality and composability in blockchain ecosystem.