Connext teamed up with different cross-chain bridging protocols to sentence LayerZero for deploying a bridge for stETH with out assist from the token’s issuer, Lido.

The Oct. 27 tweet from Connext criticized LayerZero for deploying a “proprietary illustration” of Lido’s stETH token on the Avalanche, BNB Chain, and Scroll networks with out assist from Lido DAO final week.

“Token-issuing DAOs needs to be the final word arbiters of what model of their asset is canonical on a given chain,” the assertion mentioned. “An absence of DAO-led social consensus across the canonical illustration of a given asset drives fragmentation.”

The doc was co-signed by ChainSafe, Li.Fi, Sygma, Celer, Throughout, Socket, Hashi, and Router.

LayerZero controversy

On Oct. 26, LayerZero posted a proposal to Lido’s governance discussion board pitching the launch of a cross-chain bridge for its liquid staking token, stETH, leveraging LayerZero’s Omnichain Fungible Token (OFT) normal.

Nonetheless, on the identical day, LayerZero additionally introduced that the stETH bridge was stay and prepared to be used by way of its social channels that very same day — attracting criticism from outstanding voices within the web3 neighborhood.

Onlookers slammed LayerZero for front-running Lido’s governance course of, regardless of early discussions yielding vital opposition to the proposal attributable to safety and liquidity fragmentation issues.

Bridging requirements

LayerZero facilitates cross-chain transfers between Ethereum Digital Machine (EVM)-compatible chains utilizing its OFT normal.

OFT permits cross-chain transactions by minting tokens on a vacation spot chain whereas concurrently destroying the tokens on the chain the switch was despatched from. The system additionally ends in the unique asset represented by LayerZero’s OFTs turning into locked within the bridge’s good contracts.

Of their joint assertion, Connext and firm argue that “vendor-locked proprietary requirements” mustn’t underpin cross-chain bridging protocols, asserting that the locking mechanism creates systemic dangers for asset issuers and tokenholders.

“Whereas marketed as a normal, OFTs and different provider-specific programs are basically owned by the bridges that implement them,” the assertion mentioned. “Tokens issued by way of proprietary requirements stay endlessly tied to the safety mannequin of the issuing bridge. Lock-ins discourage energetic iteration on safety… Bridges have suffered over $2B price of hacks over the previous two years on account of these systemic dangers.”

To treatment the state of affairs, the manifesto requires the adoption of open and public expertise requirements and the elimination of lock-in mechanisms. The assertion provides a modified model of EIP-7281 as one sensible answer.