Axelar

Axelar is a decentralised network designed to enable seamless cross-chain communication among heterogeneous blockchain ecosystems. It provides a universal infrastructure layer consisting of a decentralised validator network, a protocol suite, and developer-facing APIs. This infrastructure facilitates secure and scalable interoperability between blockchains that operate independently and use different consensus models or languages.

The Axelar network is structured around two key protocols:

• Cross-Chain Gateway Protocol (CGP): Functions similarly to Internet routing protocols, allowing blockchain platforms to connect without needing to customise their code or communication standards.
• Cross-Chain Transfer Protocol (CTP): A higher-level protocol for application developers to facilitate operations such as asset transfers, cross-chain calls, and composability between decentralised applications.

These protocols are secured by a Delegated Proof-of-Stake (DPoS) blockchain. Validators, elected by token holders, run light clients of external chains, collectively maintain threshold cryptographic keys, and sign cross-chain transactions. This setup enables Axelar to act as a decentralised, programmable cross-chain oracle with both read and write capabilities.

The core goal of Axelar is to simplify interoperability for blockchain developers and users, allowing applications to operate across chains without needing to implement and maintain custom bridges.

AXL is the native utility and governance token of the Axelar network. It serves several critical functions within the system:

1. Validator Staking and Delegation: AXL is used within a Delegated Proof-of-Stake model. Validators must stake AXL to participate in consensus, and token holders can delegate their AXL to validators to share in rewards and governance influence. Validator performance and security are incentivised through staking rewards and slashing mechanisms.

2. Transaction Fees: AXL is used to pay for operations on the network. This includes transaction fees for processing cross-chain requests and maintaining bridges between chains. These fees contribute to validator rewards and help secure the network.

3. Governance: AXL token holders participate in governance decisions regarding the Axelar network. This includes voting on proposals to add or remove supported blockchains, adjust economic parameters, or enact changes to the network's protocol.

4. Security via Threshold Cryptography: Validators jointly control threshold accounts on various chains. The integrity and security of cross-chain transactions depend on validator cooperation, which is directly tied to the value they stake in AXL. A high threshold (e.g. 90%) is required to authorise transactions, maximising safety.

5. Emergency Recovery Mechanism: AXL is involved in governance-controlled recovery processes in case of a network stall. Emergency unlock keys may be shared with governance-selected community stakeholders, providing an additional layer of decentralised control.

Axelar was founded by Sergey Gorbunov and Georgios Vlachos, both of whom have strong academic and technical backgrounds in cryptography and distributed systems. Sergey Gorbunov holds a PhD in cryptography from MIT and has worked on threshold cryptography and privacy-enhancing technologies. The team includes researchers and engineers with experience from companies such as Algorand, MIT, and other blockchain infrastructure projects.

The project was first introduced via a whitepaper published in January 2021. Axelar has received backing from prominent investors in the blockchain industry and operates as an open-source, decentralised protocol that welcomes developer participation and validator onboarding.