Security is a transport guarantee. A chain's security model only governs its own state; the security of assets moving between chains is defined by the bridging protocol's verification. This creates a critical dependency on external infrastructure like LayerZero, Axelar, or Wormhole.
the-modular-blockchain-thesis-explained
Blog
Why Interchain Security is an Infrastructure Problem
The modular blockchain thesis fragments security. We analyze why securing communication between sovereign chains is not a protocol-level feature but a dedicated infrastructure layer, built by validators, light clients, and fraud/zk-proof systems.
introduction
THE INFRASTRUCTURE GAP
The Modular Security Fallacy
Interchain security is not a consensus problem to be solved by validators, but an infrastructure problem defined by message delivery guarantees.
Modularity exports security risk. Decoupling execution from settlement, as with rollups, shifts the security burden to the bridging and sequencing layers. The failure of a bridge like Multichain or a sequencer like AltLayer's shared service demonstrates this systemic risk.
Proof verification is insufficient. Light clients and zk-proofs, as used by Succinct or Polymer, verify state but do not guarantee liveness or data availability. A validator set can be honest but offline, breaking the cross-chain channel.
Evidence: The 2023 Nomad Bridge hack lost $190M due to a flawed upgradeable proxy contract, not a consensus failure. This illustrates that the weakest link in interchain security is often off-chain governance and implementation, not cryptographic verification.
key-insights
WHY INTERCHAIN SECURITY IS AN INFRASTRUCTURE PROBLEM
Executive Summary: The Infrastructure Mandate
The promise of a multi-chain future is collapsing under the weight of fragmented security models. True interoperability requires a fundamental re-architecture of trust.
01
The Problem: Fragmented Security = Systemic Risk
Each new bridge or L2 introduces a unique, often under-audited, trust assumption. The result is a $2B+ annual exploit surface where the failure of a single component compromises the entire system.
- Attack Surface Multiplies: 100+ bridges create 100+ points of failure.
- Trust Assumption Dilution: Users must trust new, unproven multisigs and oracles.
- Liability is Opaque: Risk is obscured, making rational security budgeting impossible.
$2B+
Annual Bridge Losses
100+
Attack Surfaces
02
The Solution: Shared Security as a Primitive
Security must be a reusable, leaseable resource, not a per-chain cost center. Protocols like Cosmos ICS and EigenLayer treat security as a commodity, allowing chains to bootstrap from established validator sets.
- Capital Efficiency: Validators secure multiple chains with the same stake.
- Predictable Economics: Security cost becomes a clear, auditable operating expense.
- Collective Defense: A unified security pool deters coordinated attacks.
10x+
Capital Efficiency
-90%
Bootstrap Cost
03
The Problem: The Oracle Dilemma
Most cross-chain messaging (e.g., LayerZero, Wormhole) relies on external oracle/relayer networks to attest to state. This reintroduces the very trusted third parties blockchains were built to eliminate.
- Centralized Failure Points: Relayer committees can collude or be compromised.
- Latency vs. Security Trade-off: Faster attestations require smaller, riskier sets.
- Economic Misalignment: Relay incentives are often not cryptoeconomically secured.
~3-5
Critical Relayers
~2s
Vulnerability Window
04
The Solution: Light Client & ZK Verification
The endgame is trust-minimized state verification. IBC uses light clients, while zkBridge projects use succinct proofs to verify chain history. The validator set is the security.
- Trust Minimization: Verify, don't trust. Direct cryptographic verification of source chain state.
- Censorship Resistance: No intermediary can block a valid message.
- Long-Term Scalability: Proof aggregation can reduce verification cost over time.
~100%
Uptime SLAs
~30s
Finality Time
05
The Problem: Liquidity Fragmentation is a Security Issue
Siloed liquidity on hundreds of chains creates brittle financial systems. Bridge hacks cause immediate, catastrophic depeg events (e.g., Nomad, Wormhole). Canonicallly bridged assets are an illusion.
- Reflexive Depegs: A bridge exploit destroys confidence in all bridged assets.
- Arbitrage Inefficiency: Price discrepancies persist, signaling weak security guarantees.
- Capital Stuck in Transit: Billions in liquidity are locked in escrow contracts.
$10B+
TVL in Escrow
>20%
Depeg Risk Premium
06
The Solution: Native Asset Issuance & Intent-Based Routing
Stop bridging. Mint assets natively via cross-chain mint/burn (e.g., Circle CCTP) or use solvers that abstract the path (e.g., UniswapX, Across). The user sees one asset; the infra handles the rest.
- No Bridged Tokens: Eliminate the canonical representation attack vector.
- Optimal Execution: Solvers compete to find the most secure/cheapest route.
- User Abstraction: Security becomes a backend parameter, not a user decision.
0
Bridged Counterparty Risk
~500ms
Route Discovery
thesis-statement
THE INFRASTRUCTURE LAYER
Thesis: Security is a Service, Not a Feature
Blockchain security must be a composable, market-driven service, not a siloed feature built by every application.
Security is a commodity that applications should procure, not build. Every dApp team building its own validator set or bridge is a systemic waste of capital and engineering talent, creating fragmented and often weaker security models.
Interchain security is an infrastructure problem because asset movement across chains is a universal primitive. The current model forces each protocol like Uniswap or Aave to become a security expert for every chain they deploy on, which is unsustainable.
The market consolidates security providers. Just as AWS won over private data centers, specialized services like LayerZero's OFT, Axelar's GMP, and Wormhole are becoming the default security layer. Their economic security scales with usage across all applications.
Evidence: The $1.8B Total Value Secured (TVS) by Axelar's General Message Passing demonstrates that applications pay for security-as-a-service. This model outperforms the security of a solo chain's bridge with a $200M TVL.
WHY INTERCHAIN SECURITY IS AN INFRASTRUCTURE PROBLEM
The Security Stack: A Comparative Breakdown
Comparing core security models for cross-chain value transfer, highlighting the infrastructure-level trade-offs between trust, cost, and liveness.
| Security Primitive / Metric | Native Validators (e.g., LayerZero, Wormhole) | Optimistic Verification (e.g., Across, Nomad v1) | Light Client / ZK Bridges (e.g., IBC, Succinct) |
|---|---|---|---|
Trust Assumption | Active honesty of external validator set | Economic honesty with fraud-proof window (e.g., 30 min) | Cryptographic honesty of the source chain |
Liveness Guarantee | Immediate (assuming honest majority) | Delayed by challenge period | Bound by source chain finality + proof generation (~2-5 min) |
Capital Cost (Relayer/Prover) | High (Staked by validators) | Medium (Bonded by watchers) | Low (Gas fees for proof submission) |
Data Availability Source | Off-chain attestation | On-chain Merkle root on destination | On-chain block headers on destination |
Censorship Resistance | Low (Relayer can censor) | High (Anyone can submit fraud proof) | High (Anyone can submit validity proof) |
Protocol Examples | LayerZero, Wormhole, Axelar | Across, Nomad (v1), Chainlink CCIP | IBC, Succinct, Polyhedra zkBridge |
deep-dive
THE STATE OF THE NETWORK
Deconstructing the Verification Stack
Interchain security is not a bridge problem but a fundamental infrastructure gap in state verification.
The core problem is verification. Every cross-chain action requires proving the state of a remote chain, a task that scales quadratically with the number of chains.
Current bridges like LayerZero and Wormhole are messaging layers. They delegate the hard work of state verification to external oracles and relayers, creating a trust bottleneck.
Light clients and ZK proofs are the endgame. Projects like Succinct and Polymer are building generalized verification layers to make cryptographic proofs of state the default.
Evidence: The IBC protocol processes billions in value because its light client-based verification is baked into the Cosmos SDK, not bolted on.
protocol-spotlight
WHY INTERCHAIN SECURITY IS AN INFRASTRUCTURE PROBLEM
Infrastructure Providers in the Wild
The security of cross-chain activity is not a protocol feature; it's a core infrastructure challenge that determines the entire ecosystem's risk surface.
01
The Problem: Fragmented Security Models
Every bridge, like LayerZero or Axelar, is a new trust assumption. Users must audit dozens of independent, often under-collateralized systems, creating systemic risk. The Wormhole and Ronin Bridge hacks ($600M+ combined) are symptoms.
- Attack Surface Multiplies with each new chain and bridge.
- No Shared Security: A failure in one bridge doesn't protect others.
- User Burden: Security analysis is impossible for the average user.
50+
Unique Bridges
$2.5B+
Bridge Hacks (2022)
02
The Solution: Shared Security Hubs
Projects like EigenLayer and Cosmos Interchain Security treat security as a reusable resource. Validators/stakers from a secure chain (e.g., Ethereum) can extend cryptoeconomic security to new chains or AVSs (Actively Validated Services).
- Capital Efficiency: Reuse $50B+ of Ethereum stake.
- Unified Slashing: Malicious behavior on a consumer chain penalizes the main chain stake.
- Infrastructure Primitive: Enables secure, lightweight rollups and app-chains.
$50B+
Reusable Stake
1 -> N
Security Model
03
The Problem: Oracle & Relayer Centralization
Most cross-chain messaging (e.g., for Chainlink CCIP, Wormhole) relies on a permissioned set of oracle nodes or relayers. This creates central points of failure and potential censorship, betraying blockchain's decentralized ethos.
- Trusted Committee: Often 5-20 known entities.
- Liveness Risk: Committee downtime halts cross-chain activity.
- Regulatory Attack Vector: A jurisdiction can target the known entities.
5-20
Node Committee Size
100%
Liveness Dependency
04
The Solution: Decentralized Verification Networks
Networks like Succinct and Herodotus use cryptographic proofs (ZK or validity proofs) to verify state on another chain. The security reduces to the cryptographic assumption and the security of the destination chain (e.g., Ethereum).
- Trust Minimization: No active committee, just math.
- Censorship Resistance: Anyone can generate/submit a proof.
- Future-Proof: Aligns with the ZK-rollup endgame for scaling.
~0
Trust Assumptions
ZK
Base Primitive
05
The Problem: Liquidity Fragmentation & Slippage
Native bridging locks liquidity in canonical bridges, while DEX aggregators like LI.FI and intent-based systems (UniswapX, CowSwap) face high slippage and MEV on long routing paths. This makes large cross-chain swaps economically inefficient.
- Capital Lockup: Billions sit idle in bridge contracts.
- Multi-Hop Slippage: Each hop in a DEX route adds cost.
- MEV Extraction: Arbitrage bots capture value from slow messages.
$10B+
Locked in Bridges
100+ bps
Slippage Cost
06
The Solution: Programmable Liquidity Layers
Protocols like Circle's CCTP and Across (using bonded relayers) and intent solvers create a unified liquidity layer. They use atomic transactions or fast, guaranteed settlement to minimize capital lockup and slippage.
- Capital Efficiency: Liquidity is re-used, not siloed.
- Guaranteed Settlement: Solvers compete to fulfill user intents optimally.
- Native Yield: Bridge liquidity can be put to work (e.g., staked).
<5 bps
Target Slippage
Atomic
Settlement Speed
counter-argument
THE INFRASTRUCTURE LAYER
The Counter-Argument: Are Shared Sequencers the Answer?
Shared sequencers address ordering but not the fundamental security fragmentation of cross-chain state.
Shared sequencers solve ordering, not security. They provide atomic composability for transactions across rollups but delegate final settlement and state verification to disparate L1s. This creates a trust boundary at the settlement layer, where a rollup's security is still defined by its individual L1.
The security model remains fragmented. A user's asset on a rollup secured by Ethereum is fundamentally safer than one on a Cosmos app-chain or a Solana SVM rollup. Shared sequencers like Astria or Espresso standardize the mempool, not the security guarantees of the underlying state proofs.
Interchain security is a data availability and proof verification problem. True security unification requires a shared, cryptographically verifiable data layer (like EigenDA or Celestia) and a standardized proof system (like zk proofs). Without this, shared sequencers are a coordination layer atop broken foundations.
Evidence: The IBC protocol demonstrates this principle. Its security is not from a shared sequencer but from light client verification of canonical chains. Cross-chain intent systems like UniswapX and Across Protocol must still trust the security of the destination chain, regardless of transaction ordering.
risk-analysis
WHY INTERCHAIN SECURITY IS AN INFRASTRUCTURE PROBLEM
The Bear Case: Systemic Risks of Fragmented Security
The multi-chain future is here, but its security model is a patchwork of isolated, under-audited validators creating systemic contagion risk.
01
The Validator Reuse Problem
Top-tier validators like Figment and Chorus One are over-leveraged across 50+ chains, creating a single point of failure. A slashable offense on one chain could cascade, forcing simultaneous mass unbonding events.
- Concentrated Risk: A handful of entities secure >60% of Cosmos app-chain TVL.
- Economic Misalignment: Validator rewards are per-chain, but slashing risk is systemic.
>60%
TVL Concentration
50+
Chains Per Entity
02
The Bridge & Oracle Attack Surface
Every new bridge (LayerZero, Wormhole, Axelar) is a new, $100M+ honeypot secured by its own small validator set. The Poly Network and Nomad hacks proved the model is brittle.
- Fragmented Audits: Each bridge requires a separate, costly security audit.
- Liquidity Silos: TVL is trapped in bridge contracts, not earning yield on the destination chain.
$100M+
Avg. Bridge TVL
~20
Avg. Validator Set
03
Economic Abstraction Failure
Users must hold and stake the native token of every chain they interact with for security. This kills UX and fragments capital efficiency, a problem EigenLayer and Babylon are attempting to solve.
- Capital Inefficiency: Billions in staked capital sits idle, securing only one chain.
- Barrier to Entry: New chains must bootstrap both validators and a valuable staking token from zero.
>10
Tokens to Hold
$50B+
Idle Stake
04
The Replicated State Problem
Every app-chain runs a full node for every other chain it connects to, leading to exponential state bloat. This creates unsustainable hardware requirements, centralizing nodes to professional operators.
- Hardware Sprawl: Node requirements grow O(n²) with connected chains.
- Sync Time: Joining a new network can take days, not minutes.
O(n²)
State Growth
Days
Sync Time
future-outlook
THE INFRASTRUCTURE PROBLEM
Outlook: The Convergence of Proof and Stake
Interchain security is not a protocol design challenge but an infrastructure problem requiring new primitives for stake and proof distribution.
Security is an infrastructure primitive. The core challenge for interchain security is not designing a new consensus algorithm but building the network infrastructure that allows stake and validity proofs to be efficiently distributed and verified across sovereign systems.
Stake-based security is a bandwidth problem. Protocols like EigenLayer and Babylon treat stake as a portable commodity, but their economic security is bottlenecked by the latency and cost of moving attestations, a problem that interoperability layers like LayerZero and Axelar are built to solve.
Proof-based security is a compute problem. zk-proofs from projects like Polygon zkEVM or Scroll offer cryptographic finality, but their verification cost on a destination chain becomes the new security bottleneck, demanding specialized proof aggregation networks.
The convergence is inevitable. The end-state is a hybrid security model where light clients verify zk-proofs of state transitions secured by economically bonded, natively restaked assets, creating a unified security layer for all chains.
takeaways
WHY INTERCHAIN SECURITY IS AN INFRASTRUCTURE PROBLEM
TL;DR for Builders and Investors
The multi-chain future is here, but its security is fragmented and fragile. Here's the core infrastructure gap and who's building to fill it.
01
The Problem: You're Only as Strong as Your Weakest Link
Today's bridges and cross-chain apps are a patchwork of trusted third parties and inconsistent security models. A single exploit in a bridge like Wormhole or Multichain can cascade, threatening the entire ecosystem's $10B+ TVL. This isn't a dApp problem; it's a systemic infrastructure failure.
$2B+
Bridge Exploits
50+
Unique Bridge Protocols
02
The Solution: Shared Security as a Primitive
Projects like Cosmos Interchain Security and EigenLayer are reframing security as a reusable resource. They allow chains (consumers) to lease economic security from a larger, established validator set (providers like the Cosmos Hub or Ethereum stakers). This creates a security flywheel and reduces bootstrap risk for new chains.
~$50B
Securing Pool (EigenLayer)
1 -> N
Security Model
03
The New Battleground: Light Clients & ZKPs
The endgame is trust-minimized interoperability. This requires lightweight, verifiable proofs of state. Teams like Succinct Labs (bringing Ethereum light clients to Cosmos) and Polygon zkEVM (with its ZK-powered bridge) are using zero-knowledge proofs to make cross-chain verification cryptographically secure, not socially trusted.
~10KB
Proof Size
~3s
Verification Time
04
The Investor Lens: Security Stacks Over Silos
The value accrual is shifting from individual L1s to cross-chain security layers. The infrastructure winners won't be another EVM chain; they'll be protocols that secure all chains. Watch for: validator set marketplaces, ZK light client networks, and universal attestation layers.
100x
TAM Expansion
Layer 0
New Investment Layer
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