web3 ecosystem: Why chain abstraction is the next frontier for Web3

The promise of Web3 lies in its potential to create a decentralized, user-centric internet where individuals have full control over their digital interactions and assets. However, the reality of using decentralized applications (dApps) today often falls short of this vision. Many dApps require users to navigate a complex web of exchanges, wallets, gas fees, and multiple blockchain networks, making the user experience cumbersome and fragmented. This complexity is a significant barrier to mainstream adoption.

For example, consider a user wanting to purchase an item using a dApp. They must:

1. Acquire the necessary crypto on an exchange.
2. Transfer the funds to a compatible wallet.
3. Navigate the dApp, ensuring they have the correct network and sufficient gas fees.
4. Complete the transaction, often involving multiple confirmations and signatures.

This process is far from the seamless, user-friendly experience offered by Web2 application. That is why chain abstraction is emerging as a crucial next step for the Web3 ecosystem.

The Shift Towards Modularity Creating Fragmented Web3

Web3 initially tackled scalability through modularity—separating blockchain functions like settlement and execution. This approach has led to the development of layer-2s, rollups, sidechains, and state channels. While modularity improved scalability, it also exacerbated fragmentation. Each new solution created its own ecosystem, leading to isolated liquidity pools, disparate user bases, and increased complexity for both developers and users.

The Vision of Chain Abstraction

Chain abstraction addresses these challenges by shielding users from blockchain complexities. It aims to create a user interface where interacting with dapps is as intuitive as using various apps today.For example, Raj buys concert tickets on one app, and Arjun reimburses him on another, regardless of blockchain differences. Even basic tasks like payments require managing wallets, choosing chains, exchanging addresses, calculating gas fees, and signing transactions multiple times—barriers that must be simplified for developers and users alike.Chain abstraction also benefits areas like E-Commerce and Loyalty Programs. Lisa, shopping online with a dapp offering token rewards, receives an NFT discount voucher stored on a different blockchain. The dapp manages all cross-chain interactions seamlessly.

Achieving Chain Abstraction: Key Innovations

Web3 needs an orchestration layer to solve the challenges across all levels: chain level, user account level, app level, and user experience level. By providing a holistic solution that orchestrates transactions across multiple blockchains, abstracts complexities, and introduces standardized APIs and mobile SDKs, developers can create web2-like experiences for mass adoption. This enhances development efficiency, which is crucial for enterprise adoption and mainstream applications.

Chain abstraction has the potential to revolutionize the Web3 ecosystem by making it more accessible, user-friendly, and interoperable. By eliminating the barriers of multiple blockchains, a seamless experience can be created where users interact with dApps just as effortlessly as they do with traditional Web2 applications.

In conclusion, for Web3 to achieve mainstream adoption, the complexities of blockchain technology must be abstracted away from the user. Chain abstraction represents the next frontier in this journey, promising a future where decentralized applications are truly decentralized, user-friendly, and accessible to everyone. As we continue to innovate and develop these solutions, we move closer to realizing the full potential of Web3.

(The author is co-founder of CoinDCX and Okto)