Squid Launches CORAL for Efficient Cross-Chain Liquidity Swaps
Squid has launched a decentralized intent-based liquidity protocol named the Cross-Chain Order Routing and Auction Layer (CORAL), designed for cheaper, faster, and more efficient cross-chain swaps.
CORAL employs a request-for-quote (RFQ) system, enabling users to perform swaps across chains with minimal costs and near-instant finality. The protocol's intents manage swaps natively, utilizing market maker order book pricing akin to CoWSwap, which eliminates slippage and ensures optimal execution by directly engaging liquidity providers during transactions.
Fig, Squid’s co-founder, stated that CORAL facilitates seamless liquidity flow between chains. This new protocol builds on the Squid 2.0 upgrade, which simplified complex cross-chain transaction flows.
Notably, as transaction volume increases, costs decrease for end users due to the architecture's ability to batch intents, resulting in significant gas savings and optimal swap execution. Fig claims it is “the cheapest decentralized intent protocol” available, outperforming competitors like Across Protocol.
Across Protocol uses intricate cryptographic batching processes, whereas CORAL utilizes Axelar’s secure general message-passing protocol. This structure transfers bridge and routing risks to market makers, allowing users to receive native assets on their destination chain without relying on wrapped tokens or external validators.
CORAL also enables developers to create complex DeFi applications using pre- and post-hooks, allowing actions such as depositing cross-chain-swapped assets into yield farms with a single click. Fig anticipates a future where most assets reside on one or two chains, facilitating the holding of native assets without bridging.
The protocol is operational on major chains including Ethereum, Arbitrum, and Base, with plans to integrate Solana, Sui, and Aptos in January, followed by Cosmos-based chains through IBC in 2025. Future developments include aggregating multiple messaging protocols like Hyperlane, enhancing support for an additional 40-50 EVM-compatible blockchains, thus creating a “network of networks” for improved interoperability.
Overall, Squid aims to achieve true chain abstraction, allowing users to interact seamlessly with assets from various chains. Fig noted that cross-chain swaps are now as economical as single-chain swaps, pushing towards full chain abstraction where users need not consider the originating chain of their assets.