Blockchain interoperability has been seen by crypto critics to be a fantasy. So much so any project that even broaches the issue from any angle gets shut down by these naysayers.
We reached out to Eric Chen, CEO and co-founder of Injective Labs to give us insight into the complex world of crypto interoperability and more.
His thoughts are really interesting to say the least.
Eric Chen, CEO and Co-founder of Injective Labs
E-Crypto News:
How does Injective enable crypto and Web3 interoperability?
Injective enables crypto and Web3 interoperability through its integration with various blockchain ecosystems. As part of the Cosmos ecosystem, Injective is natively compatible with the Inter-Blockchain Communication (IBC) protocol. This means that it can seamlessly interact and exchange data with other Cosmos-based blockchains, fostering interoperability within the Cosmos network.
Moreover, Injective has integrated Wormhole, a decentralized bridge protocol that facilitates interoperability between different Layer 1 blockchains. By incorporating Wormhole, Injective extends its interoperability beyond the Cosmos ecosystem, allowing for integration with numerous prominent Layer 1 chains such as Ethereum, Solana, Polygon, and more. This integration empowers Injective to become one of the most interoperable chains available within the Web3 landscape.
The ability to connect with various blockchain ecosystems through both the native support of Cosmos and the integration of Wormhole positions Injective as a key player in enabling seamless interoperability within the crypto and Web3 space.
E-Crypto News:
What is Injective’s major contribution to the DeFi space?
What sets Injective apart from many other blockchain networks is its explicit focus on the finance sector. Unlike generic blockchains or app-chain layers, Injective is purpose-built to cater specifically to the needs of DeFi. By designing the infrastructure, modules, and blockchain capabilities with DeFi builders in mind, Injective offers an optimized environment for the development of decentralized financial applications.
One of Injective’s notable contributions to the DeFi space is its introduction of an on-chain order book for trading, which diverges from the prevalent Automated Market Maker (AMM) model widely used in the crypto industry. By incorporating an order book module, Injective enables more traditional traders to experience a trading interface they are familiar with. This approach not only provides a more intuitive and efficient trading experience but also helps mitigate issues like front-running. The presence of an on-chain order book attracts larger players from traditional finance, bridging the gap between the traditional financial world and the crypto space.
Related: What Are The Major Decentralized Finance (DeFi) Ecosystem Problems?
E-Crypto News:
How can projects deploy Injective?
Injective provides an open and accessible platform for projects to deploy their applications. Building on top of Injective is a straightforward process, and anyone can leverage its capabilities to create innovative solutions. To assist developers and builders, Injective offers a range of resources and guides available at docs.injective.network.
E-Crypto News:
Can you tell us more about staking the INJ token?
Staking the INJ token is an integral part of the Injective ecosystem and allows users to actively participate in securing the network while potentially earning rewards. Injective operates on a proof-of-stake consensus mechanism, meaning that the network’s security and operation are maintained by a group of validators.
By staking their tokens, users not only support the network but also have the opportunity to potentially earn rewards. These rewards can be in the form of additional INJ tokens, providing users with an incentive to actively participate in the ecosystem.
To begin staking INJ tokens, users can visit hub.injective.network/staking or visit the staking guide at https://blog.injective.com/injective-hub/.
E-Crypto News:
How does governance with the INJ token work?
Injective operates under decentralized community governance, where all blockchain activities, including chain upgrades and new market listings, undergo a voting process. Community members play a crucial role in approving on-chain changes through their votes.
The governance process begins with the submission of proposals, which can be initiated by any holder of the INJ token.
Once a proposal is submitted, it enters a voting period. During this period, token holders who have staked their INJ tokens have the opportunity to participate in the decision-making process. In order for a proposal to pass, more than 33.4% of the total staked tokens must be utilized for voting, and the proposal must receive at least 50% of the votes in favor.
This governance mechanism ensures that important decisions within the Injective ecosystem are made in a transparent and democratic manner, with the participation and input of the community.
E-Crypto News:
Please can you tell us about Injective’s security features?
Injective incorporates multiple security features to ensure the safety of its network and applications. The main security features are, of course, its proof-of-stake consensus mechanism and it’s frequent audits and security assessments to identify and address potential vulnerabilities and weaknesses in its system.
But Injective’s unique blockchain design also provides an added layer of security. By adopting a more tightly defined application logic compared to traditional Ethereum Virtual Machine (EVM)-based DeFi applications, Injective minimizes the potential for common exploits such as re-entrancy attacks, miner extractable value (MEV), and flash loans. This design approach ensures that the platform is more resistant to these types of vulnerabilities and enhances the security of user assets and transactions.
E-Crypto News:
What’s the backstory behind Injective’s development?
Injective Labs was founded by myself and Albert Chon, my co-founder, with the vision of developing a scalable network that would democratize financial access on a global scale.
Our journey began when we joined Binance’s first incubation program in 2018. It was during this time that the initial concepts and foundations of Injective started taking shape. We were able to refine our ideas and lay the groundwork for what would eventually become Injective.
As Injective continued to grow, it naturally attracted a talented team of contributors from diverse backgrounds, including cryptography, traditional finance, FinTech, and other relevant fields. These individuals brought their expertise and passion to the table, helping to shape and grow the network into what it is today.
E-Crypto News:
Please, can you tell us about the key players within the Injective ecosystem?
Some of the best builders within the industry are building and contributing to Injective, including, but not limited to, Delphi Labs, Pyth, and Wormhole. To see a full list of contributors to Injective and its ecosystem, visit here: https://injective.com/ecosystem.
E-Crypto News:
Please can you tell us about the Cosmos project?
Cosmos is a dynamic and growing ecosystem that encompasses a range of interoperable and independent blockchain applications and services. At the heart of Cosmos is its software development kit (SDK), which provides a framework for developers to build their own application-specific blockchains, commonly referred to as app-chains.
What sets Cosmos apart is its innovative Inter-Blockchain Communication (IBC) protocol. IBC enables seamless communication and interaction between different blockchains within the Cosmos ecosystem. This means that app-chains built using the Cosmos SDK can connect and exchange data, assets, and functionality with one another, fostering interoperability and composability between disparate blockchain projects.
E-Crypto News:
What is the relationship between Injective and Cosmos?
Injective was one of the first projects to utilize the Cosmos SDK in order to build its sector-specific blockchain for finance. In an effort to build an on-chain orderbook exchange, Injective ran into slow latency issues, high gas fees, slower transaction times and more, which was why the move to build on Cosmos was so integral to its success.
By utilizing Cosmos and the IBC protocol, Injective ensures compatibility and interoperability with other chains within the Cosmos ecosystem, without giving up the sovereignty that it needs to provide the infrastructure needed for DeFi applications.
E-Crypto News:
Why is Cosmos growing in popularity?
Cosmos is experiencing growing popularity due to its core value propositions of interoperability and app-chain customization. Interoperability has become a crucial requirement within the crypto space, as it enables seamless communication and interaction between different blockchain networks.
Moreover, Cosmos provides a flexible framework for building app-chains. App-chains are individual blockchains that can be tailored to specific use cases or applications, allowing projects to customize their solutions according to their unique requirements. This flexibility empowers developers to create blockchain-based applications that are optimized for their intended purposes.
E-Crypto News:
What role will institutional participation play in the DeFi industry’s future?
While we are still in the early stages of realizing the vision of a democratized financial future through decentralization, the involvement of both individual users and traditional financial institutions is crucial for its advancement.
For the DeFi industry to achieve widespread adoption and reach its full potential, it is important to bridge the gap between traditional finance and decentralized finance. Injective recognizes this need and is focused on building more traditional financial offerings on a decentralized platform. This approach provides a level of familiarity for institutional players, making it easier for them to transition to DeFi while benefiting from the advantages and value offered by the industry.
Related: Primary Challenges Of DeFi Every Consumer Must Know
E-Crypto News:
How do you think things will play out in the cryptospace for the remaining part of the year?
For the remaining part of the year, the crypto space is expected to witness further developments and growth. The shortcomings of traditional finance and banking systems, coupled with increasing awareness about the benefits of decentralized finance (DeFi), are driving more users to explore and embrace crypto.
As developers continue to innovate and build new solutions, we can anticipate the emergence of exciting use cases and applications within the DeFi space. These developments will not only attract more users but also contribute to the maturation of the crypto ecosystem.
E-Crypto News:
What role will Injective play in enabling and increasing crypto and DeFi interoperability?
Injective will continue pioneering crypto and DeFi interoperability. One of the most recent contributions is the launch of Cascade, the first-ever Interchain Solana SVM rollup. This integration brings the Solana Sealevel Virtual Machine (svm) into the broader Cosmos world, enabling Solana developers to rapidly deploy their Solana contracts and dApps onto Injective.
By doing so, developers can now allow their projects to seamlessly go truly multichain across Solana and IBC.
E-Crypto News:
Please, can you tell us about Injective’s unique orderbook and how it works?
Injective’s unique orderbook exchange module sets it apart within the Web3 ecosystem. While most crypto trading occurs on an automated market maker (AMM) model, Injective offers a different approach.
AMMs rely on users providing liquidity for trades, whereas an orderbook exchange operates by market makers filling up an orderbook with buy and sell orders that traders can interact with. This model, commonly used in traditional finance, offers several advantages over AMMs.
One advantage is that an orderbook exchange reduces volatility within the spread, providing traders with a more stable market environment. It also mitigates the risk of front running by bots, as the orderbook allows traders to place orders based on their specific preferences without the need for immediate execution.
Injective further enhances the orderbook exchange model by utilizing a frequent batch auction (FBA) mechanism. FBAs aggregate orders and process them at regular intervals, typically between 0.2 and 0.9 seconds. In Injective’s case, batch auctions execute at each endBlock. This batching approach helps optimize transaction efficiency and ensures fair and transparent order execution.
By combining the orderbook exchange model with frequent batch auctions, Injective provides a decentralized platform that offers traders a more familiar and efficient trading experience while maintaining the benefits of a blockchain-based system.
E-Crypto News:
Please can you tell us about your backers and investors? How have your recent funding outings been despite all the regulatory moves by the US government?
Injective has been fortunate to be backed by a prestigious group of industry-leading investors. These investors include Binance, Pantera Capital, Jump Crypto, Mark Cuban and BH Digital.
With the backing of these leading inventors, Injective has gained not only financial support, but also access to valuable expertise, networks and resources to help build it to what it is today.
E-Crypto News:
What role do you think will Injective play in transforming the finance industry?
Injective is poised to play a transformative role in the finance industry by revolutionizing the way financial systems operate. As the first blockchain built specifically for finance, Injective is dedicated to delivering a superior platform for developers, fostering the integration of traditional financial institutions with Web3, and providing innovative applications for users within the crypto space.
E-Crypto News:
Do you have any goals for Injective before 2023 rounds up?
Injective has set two key goals to achieve before the end of 2023. The first goal is to launch Project X, an innovative platform designed to provide average users with unprecedented trading access. This platform will enable users to leverage trading bots that were previously exclusive to trading firms, empowering them to implement advanced trading strategies and potentially earn returns on their crypto portfolio in a decentralized manner. With the launch of Project X, Injective aims to redefine the trading experience and make it more accessible to a wider audience.
The second goal is to forge strategic partnerships with more decentralized applications (dApps) within the Solana ecosystem. Injective intends to collaborate with these dApps to leverage Cascade, its layer-2 Solana Virtual Machine (SVM) rollup solution, which is currently in the testnet phase. This partnership will facilitate synergies and enhance cross-chain compatibility between the Solana and Injective ecosystems.
These initiatives will help Injective continue its mission to create a democratized future through decentralization.
