Supra: The Ultimate Chain to Power Super dApps

Supra provisions a more sustainable and capital-efficient crypto economic security model and dynamic, self-perpetuating Network Owned Liquidity.

The Ultimate Blockchain

If history is a guide, technology inevitably trends towards greater vertical integration. The infamous “iPhone moment” was the vertical integration of touch screen, camera, GPS, WiFi/telecom, cloud-based servers, and now payments — an all–in–one device. It was the synergies of hardware and software which created an emergent value greater than the sum of its parts, lending unheard of capabilities to end users at the tap of their finger which gave us Uber, YouTube, live streaming podcasts, citizen journalism, and so much more. 

Similarly, Supra’s vertical integration of low-latency, high-throughput consensus (Commit Moonshot), external data-feeds (DORA Oracle), distributed VRF, cross-chain communication (HyperNova & HyperLoop), Move-based smart contracts and automation services — all–in–one within a unified shared security network is the iPhone moment for Web3. Thus far, Web3 has mostly been a disunited patchwork of smart contract logic that has to be funneled into risky positions to cross chains. 

In addition, they have inevitably created silos in which developers and investors have had to choose to either fall into one of them or avoid them altogether. An ecosystem based on unity and interoperability is the most natural progression forward from here. 

In this regard Supra is blazing a trail at being both a monolithic and vertically-integrated ecosystem while remaining modular and optimized for seamless interoperability. The qualities of universality and modularity are preserved with the most performant L1 guarantees in the industry, making it the world’s Ultimate Blockchain.

Vertically Integrated, Yet Modular Microservices

Supra is quickly emerging as a trailblazer in vertically-integrated, yet modular microservices architecture. At the heart of Supra’s functionality lies its Move-based smart contracts, empowering developers to create more exciting use cases for their decentralized applications with ease. 

Leveraging the power of the Move language, developers can unlock unprecedented flexibility and reliability in their smart contract designs. Going even deeper, the Supra blockchain itself is powered by the most performant consensus mechanism in the industry, Commit Moonshot (Note that this is an extension of Chained Moonshot which had included block proposal pipelining). 

First is DORA, the algos behind Supra’s decentralized price feed oracle, providing real-time, tamper-resistant data to ensure accurate and reliable execution of smart contracts. With DORA, users can trust in the integrity of their transactions, fostering a secure environment for financial activities.

In pursuit of randomness without compromise, Supra incorporates decentralized Verifiable Random Functions (dVRFs), ensuring fairness and unpredictability for consumption by dApps on a number of chains. By harnessing the power of decentralized randomness, the dVRF lends credibility and credence to the fairness of any game, chance event, or other random sampling taking place on distributed networks.

HyperNova and HyperLoop facilitate interoperability between different blockchains in their own unique ways. HyperNova uses a bridgeless relay protocol which simply communicates events on one ecosystem by relaying them to trigger smart contracts on the destination chain. Essentially, this facilitates cross-chain liquidity without introducing any additional security risks as is the case with traditional bridging infrastructure.

HyperLoop, on the other hand, is Supra’s bonded, pairwise cross-chain bridge. HyperLoop prevents double-spending by using sliding windows with time-based volume limits for cross-chain transfers, an insurance protocol pegged to these limits, whistleblower nodes to track attempted misbehavior, and the open-participation AuditDAO to settle disputes. It is the first protocol to consider real-world rational behavior of bridge nodes.

A Race to the Bottom is Unsustainable

In open-source DeFi, if a protocol extracts too much value from its users, someone is likely to fork the project and offer more competitive pricing to undercut the original protocol. Similarly, block space costs are a race to the bottom; every L1 or L2 project is trying to drive down their transaction fees as low as possible while maintaining high throughput, low latency, and decentralization. 

It is often done in artificial and unsustainable ways too, guided by a preponderance of short-term thinking. Indeed, fees will inevitably drop over time as technology improves or until Nash equilibriums are achieved. Competing in this manner is unproductive and misses the bigger picture.

Likewise, the same can be expected in regards to Oracle, VRF, cross-chain bridge, and automation service fees. Specifically, it’s likely that everything will become commoditized in the long run as these networks become public goods. 

Supra is already embracing this as an inevitable eventuality and thus are proactively disrupting the industry. Below, you’ll find Supra’s elegant solution that doesn’t resort to parasitic Oracle Extractable Value (OEV). Indeed, it is a more sustainable model with stakeholder incentives aligned towards interoperability, composability, and perpetuation of self-sovereignty accompanying digital asset ownership.

Liquidity Network and Dynamic Function Market Maker

Supra’s IntraLayer, primarily operating as a multi-chain liquidity network with native oracle services and enshrined cross-chain communication, will outperform the speed of centralized exchanges with regards to its own native asset settlement. This is specifically due to the revolutionary nature of our Moonshot consensus mechanism and decentralized HyperNova and HyperLoop interoperability algos, and represents an attractive option for peer-to-peer interactions as a secure yet decentralized technology outperforms its centralized counterparts.

Our quants analyzed the growth of various L1 and L2 projects estimated to need Oracle, VRF, and Supra’s other auxiliary services. From there, observed the expected revenue models Supra is to generate from blockchain microservices such as Oracle, VRF, Bridge, automation, distributed computation, and
 the world’s most flexible smart contracts.

Yet considered as a whole, Supra as a cross-chain liquidity network will generate an order of magnitude more revenue than the cumulative sum of a microservices model. Consequently, bootstrapping a more efficient model of network-owned liquidity is far more sustainable and serves to provide better user and developer experiences. More liquidity begets more liquidity, which results in less slippage and less impermanent loss, which is ultimately what drives user adoption. 

More recently, Supra’s research team introduced its Dynamic Function Market Maker (DFMM), a distributed protocol designed to revolutionize current approaches regarding AMM, and pave the way for Supra realizing its aspiration of Network Owned Liquidity. In other words, bonded $SUPRA stakers, among other tokens across a variety of ecosystems, will power near-instant settlements for the protocol’s cross-chain communications and bridging contracts. We’ll get more granular with the details on Supra’s Liquidity Network in the following sections.

How Supra Bootstraps Liquidity

First and foremost, node operators will provide non-Supra assets to our liquidity network and rehypothecate the re-staked tokens to borrow $SUPRA from the Supra Network treasury, that is the Network Owned Liquidity. By obtaining enough $SUPRA, operators are able to commence the running of their nodes, and earn block rewards from the original stakes tokens as well as the re-staked $SUPRA. 

In other words, these node operators can earn additional liquidity-provisioning on top of the block rewards they generate on the Supra network, thereby increasing their overall ability to support network services and sustain the ecosystem in the long term. The nuances of restaking are detailed in more length in the subsequent Proof of Efficient Liquidity whitepaper.

A number of foundations are to provide liquidity to our network for a variety of reasons, chiefly as they stand to benefit from the productive deployment of their native tokens and other treasury assets. The key is efficiency here; as staked assets are often considered unavailable for other means. 

Re-staking $SUPRA on top of those assets puts them in a position to really put their treasuries to work. By providing this liquidity, foundations can also subsidize their costs when it comes to oracle subscriptions, dVRF provisioning, and automation functionality for various dApps on their network that would otherwise have to pay unnecessary gas fees.

For example, when foundations deploy a certain amount of liquidity, up to 100 of their native dApps gain access to Supra’s low-latency, fresh data streams without incurring any costs. This is aligned with our mission to constantly seek win-win-win, and simultaneously for Supra’s best-in-class algorithms to benefit the most ecosystems possible. In this case, foundations are able to deploy their native token treasuries and in due course subsidize Supra’s Oracles for their respective ecosystems.

Instead of having dApps pay for Oracle/dVRF fees on a per-use basis (though this option is still available), Supra encourages dApps to stake a certain amount of various in-demand tokens in order to make use of network services and resources. By providing liquidity to the Supra network, market force and incentives will generate value via liquidity provisioning covering the costs of accessing Supra’s vertically-integrated stack of microservices. 

While end consumers are likely to pay for their own gas costs, Supra won’t charge a margin through this mechanism directly. In fact, if enough liquidity is provided, participating dApps may generate a surplus via staking or restaking $SUPRA.

When dApps no longer require the use of Supra’s services, they can un-stake their assets and get back their original principal, in a sense making Supra’s services “free.” Overall, the liquidity provisioned by dApps provides Supra with greater liquidity depth, while the network can rehypothecate the provided assets to earn fees from supporting the Liquidity Network. 

The sustainability of this model is much more pronounced than simply relying on Oracle or dVRF fees, which are a race to the bottom anyways. Supra as a liquidity network powered by our enshrined DFMM protocol will provide us with a serious competitive advantage as compared with a service-based model. 

Finally, end users and token holders will also be incentivized to provide liquidity to the network. Effectively, Supra’s Liquidity Network can be a place to park assets that are otherwise not generating any value, putting these idle assets to work via this re-staking model.

Takeaways

Overall, thinking of Supra as a cross-chain native asset liquidity network is a fundamental shift in perspective and decentralized revenue model. End consumers are willing to cover significantly more gas and fees to move Layer-1 assets between chains when compared to relying solely on potential fees from decentralized microservices like Oracle and VRF. This is especially true given the existing competitors in the market. 

Supra is more than a blockchain; it is a Super Chain when considering its vertically-integrated stack sharing L1 security guarantees. Likewise, its modularity positions Supra as an elegant, yet powerful IntraLayer which serves blockchains with modularity and a la carte interoperability primitives. The best part is that all of this is accomplished while at the same time wielding the power of the most performant L1 guarantees in the industry. 

Holistically, Supra as a Liquidity Network is the preferable business model in a world where blockchain fees are a race to the bottom and services become commoditized. Charging basis points on large volumes of cross-chain transactions is the superior business model for the Supra Blockchain.

Read Next

• Supra IntraLayer: Plug-and-Play Microservices for a Cross-Chain Economy
• What are Oracles?
• Verifiable Random Functions: Fair Play in a Decentralized World
• Restaking: Adding Token Utility