|1||1 Hop Protocol||Other||Ethereum Gnosis Arbitrum +3 Polygon Optimism ZkSync||58.09K||131.82K||$690.58M||$82.76M|
|2||2 Sushi||DEX||BNB Ethereum OKC +18 Gnosis Fantom Arbitrum Celo Avalanche Harmony Polygon Optimism Telos Fuse HECO Boba Metis Andromeda Moonbeam Moonriver Palm Polkadot Kusama||37.85K||118.07K||$482.59M||$310.12M|
|3||3 1inch||DEX +1 Liquidity||BNB Ethereum Gnosis +6 Fantom Arbitrum Avalanche Polygon Optimism ZkSync||39.9K||76.2K||$8.07K||$544.28M|
|4||4 Curve Finance||Liquidity||Ethereum Gnosis Fantom +8 Arbitrum Avalanche Harmony Polygon Optimism Moonbeam Aurora Polkadot||4.52K||9.67K||$4.75B||$423.63M|
|5||5 Superfluid Finance||Utilities||Ethereum Gnosis Arbitrum +3 Avalanche Polygon Optimism||607||1.24K||$695.46K||$1.76K|
|6||6 Elk.Finance||Liquidity +1 Derivatives||BNB Ethereum OKC +17 Gnosis Fantom Arbitrum Avalanche Harmony Polygon Optimism Elastos Telos Fuse HECO KCC Moonriver IoTeX Cronos Kusama Hoo||311||582||$19.95M||$94.04K|
|7||7 QiDao||Liquidity +1 Utilities||BNB Gnosis Fantom +8 Arbitrum Avalanche Harmony Polygon Optimism Metis Andromeda Moonriver Cronos||263||491||$186.54M||$482.97K|
|8||8 The Graph||Utilities||BNB Ethereum Gnosis +15 Fantom Arbitrum Celo Avalanche Harmony Polygon Optimism Boba Moonriver Aurora Near Polkadot Cosmos Acala ZkSync||231||373||$468.26M||$418.43K|
|9||9 Tornado Cash||Other||BNB Ethereum Gnosis +4 Arbitrum Avalanche Polygon Optimism||36||110||$268.70M||$2.17M|
|10||10 Honeyswap||DEX||Gnosis Polygon||32||38||$48.00|
Gnosis Chain (formerly xDAI Chain) is a blockchain aiming to provide fast and inexpensive transactions. The network has EVM compatibility and is often used as a stable payment system due to its use of the xDAI stablecoin as means of payment for transactions, payments, and fees.
Before the merger with Gnosis, the platform utilized STAKE tokens to secure the protocol’s PoS consensus and its governance, however, following the merger the project uses GNO for staking when achieving consensus on the network and for its governance.
As for the merger with Gnosis, it was originally proposed on the forum of xDAI and following a governance vote, was accepted by the community. The main goal of the partnership is to combine all the technical and financial resources of the two projects into the further development of the xDai Chain which is rebranded to Gnosis Chain.
The network also includes a Beacon Chain intended to bring iterations of various strategies to applications and give developers the choice to run dApps in faster lower-stakes environments if needed.
The network is secured by the GNOtoken which is used by validators taking part in the platform’s consensus mechanism and by delegators who stake on validators. As a means to incentivize users’ participation in the network, they are rewarded both in GNOand xDAI (for validators). The number of tokens staked determines the amount of GNOwhich is minted and distributed at the end of each epoch. Although the final emission rate is determined through community input and risk assessment, the current target APR is 15%. Besides the network transaction fees, stakers can also earn fees from users bridging assets when they remove GNOfrom the Gnosis Chain to the Ethereum mainnet.
When users convert DAI into xDAI it gets locked as DAI in the bridge initially, the locked DAI is then converted to CHAI which then earns interest on the converted amount, at the end of each epoch, the earned interest is distributed to stakers. The team has plans on implementing other rewarding mechanisms, which are currently being researched.
By staking GNO, users are allowed to participate in the governance of the network, by taking part in community votes and proposing such. Thanks to the acceptance of one such proposal, STAKE was replaced by GNO in the process of merging the two companies. The swap rate is 1 STAKE to 0.0326292707 GNO and is available since December 11, 2021. Tokens can be swapped both on the xDAI/Gnosis Chain and the Ethereum mainnet.
xDAI uses Parity’s AuRa (Authority Round), a proof-of-authority consensus model when broadcasting blocks on the network. This model includes selected validators taking turns singing blocks, which are then broadcasted to all validators as soon as the majority agrees on the validity of the block. New blocks are added every five seconds, regardless of the number of existing transactions, including if there are none.
The method of selecting validators is called POSDAO – Proof of Stake Decentralized Autonomous Organization. The process includes the selection of validators based on the amount of GNOthey place into the protocol. There is a cap on the maximum number of validators allowed to take part in the network, currently set to 19 and there is also a minimum of 2000 GNOto be locked on the protocol by each node. Since delegators can place GNOon validators and candidates for such, each week the validator sets change based on the number of eligible validators and their staking amounts.
Gnosis Beacon Chain is optimized for certain parameters such as block/epoch time and will also be utilized during important Ethereum consensus layer updates. As of the time of writing, running a validator node on the Beacon Chain only requires the equivalent of 1 GNO token, however since staking utilizes mGNO tokens, 32 of which are equal to 1 GNO it is needed to hold at least that much mGNO.
Development on the Gnosis Chain is the same as on the Ethereum mainnet as the network is an EVM chain and supports smart contracts, which also means that all contracts deployed on Ethereum can also be redeployed on the Gnosis Chain. However, in order to use the network, users need to have xDAI, which is a derivative of Maker DAO’s DAI stablecoin, meaning that xDAI is pegged to the US Dollar.
Gnosis Chain’s transaction times are said to take approximately five seconds and cost about $0.000021 USD. Thanks to the recent merger, the company will deploy all Gnosis applications to xDAI. Through the interoperability of the two networks, the deployment of the apps will allow xDAI’s fast and inexpensive transactions to be maintained while Ethereum’s mainnet application is also preserved.
Although further details are not available, it is said that Gnosis Safe – a feature allowing users to share the ownership and management of digital assets accounts through multi-sig technology, is already available on the Gnosis Chain. Besides it, the Gnosis Auction app is also available on the blockchain. Through it, users can auction ERC-20 tokens in a transparent manner, the app also uses Batch Auctions which give users more control in the bidding process. Besides token sales, the platform can be used for collateral shortfall events by leveraging xDAI.
The Gnosis Chain can be used for Peer-to-Peer payments after a wallet Gnosis Chain supports is connected to it. Currently, the network supports hardware wallets like Ledger and Trezor, as well as a number of digital apps like Coinbase Wallet, Alpha Wallet, and Burner Wallet. For GNO tokens, any Ethereum-based wallet can be used, after a simple configuration to add the token contract to it has been done.
The network is also used by different DeFi protocols like HoneySwap, Perpetual Protocol, and Swapr. The low fees of the network are what attract such projects since although there are costs associated with moving assets to Gnosis Chain, the cost of transaction and their scale and speeds are still better than those parameters on other blockchains.
Among the various use cases of the project is the creation and distribution of Community Inclusion Currencies (CICs) – local money used to pay for goods and services. These currencies are meant as complementary currencies mainly to support local level commercial activity in societies where the national currency can be volatile or scarce. One such project leveraging the xDAI chain to manage currency trading within and among communities in need in Kenya is Grassroots Economics.
The Gnosis Chain is also used for financial market predictions, in which case the daily transactions are conducted on the xDAI chain to keep the fees for gas low, while data is synchronized with the Ethereum mainnet on a regular basis.
Due to the stable nature of xDAI used for payments of fees Gnosis Chain charges and the high transaction speeds of the network, the blockchain is a useful tool for developers creating gaming apps. The same factors are also beneficial for NFT minting and trading on the Gnosis Chain.
The xDAI token is a stablecoin pegged to MakerDAO’s DAI stablecoin, which is pegged to the US Dollar, making xDAI also pegged to the US Dollar. However, xDAI’s price fluctuations, as little as they are, don’t only depend on the Gnosis Chain and the US Dollar but also on DAI’s performance. Besides, through Peer-to-Peer transactions, the token can be acquired by converting DAI from Ethereum to xDAI using the xDAI Bridge, or by converting DAI from BSC to xDAI using the OmniBridge. The digital asset can also be purchased through exchanges, or with fiat money. There is an xDAI faucet for users needing small amounts of the asset for trades.
When exchanging xDAI for DAI, the Gnosis Chain token is burned in its smart contract, following which a signal is sent to unlock the same amount of DAI on the Ethereum mainnet. After that, the funds are sent to the user’s wallet address.
Although users need to bridge GNO from Ethereum to xDAI before staking them in the protocol, which is done through BlockScout’s functionality that includes an AMB Bridge extension with an OmniBridge UI, the xDAI platform allows exchanges to offer the opportunity to provide direct delegator staking on Ethereum. In these cases, the exchange processes the request and determines which validator to stake on, and can take a percentage of the rewards earned by the user as a fee.
GNO has a total supply of 10 million tokens and has had a primary use case of generating OWL tokens via staking on the Gnosis ecosystem, however since following the merger it became xDAI/Gnosis Chain’s main stacking and governance token, Gnosis’ former products will be governed by COW and SAFE tokens.
Although further details on the future metrics of the token will be disclosed in the near future, for now, it is known that since the teams of the merging companies have been in a close partnership for a year, Gnosis invested in xDAI funds worth 250k STAKE tokens, which will be swapped for GNO and remain owned by the team.
Besides that, the GNO token value is backed by $700 million worth of crypto assets, excluding GNO, these funds are in the process of being moved to the DAO under the direct control of token holders. 400k GNO, at the time of writing worth approximately $190 million will be used to incentivize the adoption of the Gnosis Chain. Additionally, it is likely that the DAO may decide to burn some of the GNO tokens it owns, following the stakers' vote, as per the official documentation of the merger.
xDAI has been running a bug bounty program with Immunefi planned to go on following the merger as well. The incentive has already proven its value in August 2021, when a whitehat submitted an arbitrary method call vulnerability in xDAI to Immunefi. As the bug was assessed to have a medium level of severity and was determined to be out of the scope of the company’s bug bounty program, the company decided to reward the whitehat with $5,000 USDC.
The vulnerability allowed a malicious party to gain access to funds in a contract that users weren’t supposed to be able to send funds. However, ten months prior to the report a user had accidentally sent $4.5 equivalent in renBTC to the contract at risk, which amounted to the total funds at stake of being stolen by a potential hacker.
The contract with the vulnerability accounts for the Ethereum bridge utilization, and as such is supposed to allow users to pass arbitrary messages from one chain to another. Although contracts like this one are not intended to own any tokens, such could be sent to them by mistake or not, and could later be accessed by third parties with malicious intent.
The solution later implemented to respond to the discovered bug, was the addition of a monitor on the contract watching for Transfer events, and notifying the team in time so that they could act to secure them before a potentially malicious party could get ahold of them.
The xDAI team is led by Igor Barinov, who is its tech and operations lead. Barinov has been involved with Ethereum-based products since 2015. The research and development focus of the team has led to the creation of the BlockScout open-source explorer, currently the primary explorer for Ethereum Classic and numerous other chains. They are also responsible for the development and support of NiftyWallet, a web3 wallet application designed to support alt chains, and also created the TokenBridge – providing interoperability between different blockchains.
To provide for even more tools for the xDAI/Gnosis Chain, the team also includes lead players like Vadim Arasev – consensus team lead, Victor Barinov – BlockScout and NiftyWallet team lead, Alex Kolotov – TokenBridge lead, Max Alekseenko – dApp development, and Andrew Gross – technical communications.
The full list of developers involved in the Gnosis Chain can be found on its documentation webpage, where each of them has also published their GitHub user profile.
All audits Gnosis Chain has provided are available on the protocol’s dashboard on this webpage.
The Gnosis Chain ecosystem can be explored through a community-curated webpage accessible here. The main partnerships maintained by the company are with Ramp Network, which provides fiat on- and off-ramp solutions along with other payment services, Chainlink, which supplies numerous crypto projects with oracle data and other API services, DAOhaus, a project helping in the establishment and maintaining of various DAOs, and Gnosis which is in the process of merging with the blockchain.
As the near future of the project is connected to its merger with Gnosis, all the efforts of both teams are on this process. It will closely follow the Ethereum updates, which will be provided through the Beacon Chain of Gnosis. Besides an approximate end of the process set for late Q2 2022, no further details are given yet. A more complex and detailed roadmap for 2022 is expected to be released by the team, as such has been issued each year since the birth of the blockchain.
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