Multichain app review
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Last updated: Jun 25, 2022
Multichain (formerly Anyswap) is an open-source protocol that allows for cross-chain interactions. Thanks to the support of the ECDSA and EdSDA, Multichain’s solutions enable interactions between almost all the blockchains, including EVM-compatible blockchains, layer-two protocols, and parachains. All of the existing networks are either already integrated or are in the process of integration with Multichain.
The project launched under the name “Anyswap” on July 20, 2020, and rebranded into “Multichain” in December 2021. Soon after rebranding, Multichain raised a $60 million financing round led by Binance Labs. Other investors included Circle Ventures, Tron Foundation, Sequoia China, IDG Capital, Primitive Ventures, Three Arrows Capital, DeFiance Capital, Hypersphere Ventures, Magic Ventures, and HashKey.
Multichain allows asset transfers between different chains over bridges, which act as links between the chains. The assets to be bridged from one chain to another are sent to a special SMPC wallet address of the original chain and securely stored there. SMPC wallet is a wallet that uses the “secure multi-party computation” for increased security. This is the decentralized management account on Multichain.
When a new asset arrives to the decentralized management account, it triggers the wrapped asset smart contract on the destination chain to mint or burn tokens. The smart contract, created either by a third party or by the Multichain team, mints tokens on the destination chain at a 1:1 rate with those held on the decentralized management account and sends them to the user’s account. This contract is either AnyswapV5ERC20.sol, or its modified version. The contract burns tokens when the assets are redeemed to the origin chain, while SMPC nodes release them on the origin chain and send tokens to the user’s wallet.
The contract on the destination chain allows only the SMPC nodes to generate tokens. No other nodes can generate tokens.
Multichain allows any assets, no matter if they are native or created with the Multichain’s bridge, to be transferred between multiple chains via its cross-chain Router. The assets are divided into three categories: native, bridged, and hybrid native/bridged assets.
Native assets refer to the tokens which already exist on the chain. Multichain uses liquidity pools where the team or individuals add tokens for each chain. Ideally, each pool should have enough tokens for making cross-chain transfers. When one user transfers XYZ tokens from chain A to chain B, they become available for another user, who transfers XYZ tokens from chain B to chain A. The total amount of XYZ tokens in all the pools remains unchained (unless someone adds or removes tokens from the pools on purpose). If a user sends XYZ to a chain, but there is not enough XYZ in the pool for them to withdraw, anyXYZ tokens are created in proportion to required XYZ tokens.
Bridged assets are the assets created by the Multichain’s AnyswapV5ERC20.sol contract. With bridged assets, liquidity pools are not required anymore, because Multichain controls the assets’ supply on the chain where the smart contract is present. This makes the pool’s size ‘unlimited’ as Multichain can mint more tokens when additional liquidity is needed. Thus, when bridged assets are being transferred, all that is required is to ensure that a supply of that particular asset is available on the chain where it was originally minted.
Hybrid assets are a mixture of native and bridged assets. In a few cases, Multichain needs to combine native tokens with the bridged assets controlled by AnyswapV5ERC20.sol. This typically happens when a project wants to add tokens on additional chains after they already have minted a token supply or used a third-party bridge for an asset on a different chain. Thus, to add support to new chains, Multichain mints anyXYZ tokens. As a result, while the existing tokens are native, the new tokens minted for extra chains are ‘bridged’.
To use Multichain, wallets such as MetaMask, OKEx, Coin98, BitKeep, Coinbase Wallet, or Ledger need to be connected to the Multichain app.
After connecting to the app, navigate to the Router to transfer assets. Before making the first swap, you need to approve the contract for each token interacting with a contract. This action should be done only once for each token.
If there is insufficient liquidity on the target chain, you are likely to receive anyTokens. For example, if there is a lack of USDC, you will receive anyUSDC. These anyUSDC can be exchanged to USDC under the Pool tab.
Multichain fees include a 0.1% fee per transaction to the Ethereum chain and a $0.9 fee per transaction to a non-Ethereum chain. Also, there is a 0.1% fee for removing liquidity (with the minimum withdrawal fee equal to $5 and maximum — $1000). There are no deposit fees on Multichain.
The minimum withdrawal amount on Multichain is equal to tokens worth $50 (to the ETH chain — $200) and the maximum withdrawal amount is equal to tokens worth $5M.
MULTI is the governance token which allows its holders to participate in voting and ecosystem management.
The total MULTI supply will equal 100 million tokens. Upon the project’s launch, 10 million of ANY, the project’s former token, were allocated to the community and ecosystem fund, 5 million tokens were used for the initial liquidity and about 3 million tokens were used as incentives for the community and traders.
The uncirculated MULTI are locked in smart contracts, and their specific use is determined by the Multichain’s DAO.
Multichain MULTI token can be purchased on centralized exchanges like Binance, Kraken and Huobi.
It is up to you where to buy the MULTI token. It is worth taking into account that decentralized exchanges allow you to do this anonymously, you do not need to pass KYC procedures to use them, on the other hand, the cost of transactions may be higher than on centralized exchanges, while there is a risk of your funds being held by the exchange.
To understand if Multichain is a good investment and try to make a MULTI price prediction, you need to do your own research on the project.
All the data for research is available on the project page on our website: check out the technical features of the project in this review, try to use the app, see if the information about the team is available and the team is open for communication, and using the project dashboard and the MULTI price chart, assess the project usage rates as well as the token price movement and the number of its holders.
Multichain was created by the same team that is behind the Fusion blockchain. Multichain’s CEO Zhaojun He graduated with a bachelor of software engineering from Dalian University of Technology. He has more than ten years of experience in secure Linux research and development and formerly was a technical director of Chinese leading security operating system.
On July 10 2021, the new Anyswap multichain prototype V3 router was exploited. The project claimed that the bridge and V1/V2 funds were safe, only V3 liquidity pools were affected. Totally, 2,398,496.02 USDC and 5,509,227.73 MIM were stolen from the protocol. Following the incident, the Anyswap’s team fixed the code and reimbursed all the users’ losses.
Multichain has a large ecosystem consisting of more than two thousand projects and 40 blockchains. Among the major partners, which integrated with the Multichain’s Router are Fantom, BNB Chain, TerraUSD, Harmony, Arbitrum, Clover, Boba Network, and others.
Multichain collaborated with a Web3 security service provider Immunefi to launch a Bug Bounty program, with rewards up to $2 million.
Multichain’s goal is to support the maximum possible amount of chains and assets, as well as to support interoperability of multiple parties in Web3.
There is a plan to implement a new threshold signature algorithm based on MPC, and introduce AnyCall cross-chain contract support for third-party developers. The team is conducting research and development on the public MPC blockchain, which will become an infrastructure providing public trust services.
Since special attention is paid to Multichain’s ecosystem, there are plans to launch a series of incentive programs to support emerging innovations, partnerships and Web3 communities; expand Multichain communities; increase the number of tokens’ use cases; and, finally, build a global CRP (Cross-Chain Router Protocol) ecosystem.
Trail of Bits PeckShield SlowMist
Trail of Bits PeckShield SlowMist
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