Multichain DeFi draws near with Chain Signatures

Bridging between blockchains has long been seen as a cumbersome but necessary process for most crypto users who need to transfer assets like stablecoins from one chain to another. NEAR Protocol's latest innovation, Chain Signatures, aims to ease this pain point. Launched on its mainnet today, Chain Signatures streamlines blockchain interactions by enabling applications to execute actions across multiple networks through a single Near wallet transaction.

While the idea of account abstraction isn't new to blockchain technology, NEAR integrates it directly into its protocol. The use of "meta transactions" allows any account to relay transactions across networks, with relayers attaching NEAR tokens to cover gas fees. These transactions are then passed to external networks for execution as though they originated directly from the user. This approach significantly reduces friction and lowers barriers for NEAR users when engaging with assets native to other chains.
The multichain signatures function through a multi-party computation (MPC) network of NEAR validators. This means users no longer need to manage private keys for each blockchain. Instead, a single account can interact with various chains, with smart contracts managing key ownership across these networks. In essence, NEAR’s chain abstraction opens up new possibilities for cross-chain DeFi without relying on traditional bridging methods.

Alex Shevchenko, CEO and co-founder of Aurora Labs, refers to this concept as “AccountFi,” which allows users to “trade accounts on any networks along with all the assets and value those accounts have accumulated.”
Unlike traditional bridges that involve minting or burning assets, Chain Signatures operate as a one-way bridge through NEAR. For example, the Rainbow Bridge, which connects to the Ethereum Virtual Machine (EVM) on NEAR, verifies the Ethereum state without requiring reverse operations.

This innovation may also have implications for non-transferable assets like soulbound tokens (SBTs), a type of NFT. According to Shevchenko, non-transferable assets can be traded and lent, potentially making accounts with intrinsic value—such as those used for farming airdrops—more liquid.

With Chain Signatures, multiple wallets could be consolidated into one, with relayers managing both the user’s intent and transaction fees across different chains. However, the success of such a system relies on the stability of the NEAR protocol and the security of its MPC architecture. Since its mainnet launch in April 2020, NEAR has maintained a strong performance, with consistent uptime and a low average block time of approximately 1.12 seconds over the last 20 epochs (10 days).
Currently, Chain Signatures supports ECDSA chains like Bitcoin, Ethereum, BNB, and Ripple. Support for EDDSA chains like Solana and TON is expected by the end of the year.

Source: https://blockworks.co/news/near-protocol-chain-signatures-multichain-defi