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Wormhole: Analysis of the Traffic Cancellation Mechanism of the Multi-chain Interoperability Platform

2024-08-02 20:02:20


      Wormhole is a leading multi-chain interoperability platform dedicated to supporting multi-chain applications and cross-chain bridging at scale. The platform aims to connect different blockchains to ensure the secure and efficient transmission of data and assets. To improve security and prevent abuse, Wormhole uses a rate limiting mechanism called "Governor". For supported chains, the Governor sets a cap on the total outflow (in USD) of the chain within 24 hours. Outgoing transfers that exceed the chain limit are queued until the window slides and releases capacity. In this way, no transfer will be delayed for more than 24 hours.


The need to introduce a traffic cancellation mechanism for the Governor

Currently, several chains often approach 100% of their Governor limits, which causes delays and frustration for some users. This congestion is usually caused by users frequently transferring assets within the same chain for arbitrage or settlement needs. Although these actions are not fraudulent, they may inadvertently consume the Governor limit, causing transaction delays during periods of high utilization. As Wormhole becomes more widely adopted, this behavior is likely to continue, which could reduce the utility of the Governor limit in protecting against unforeseen risks.


Flow Cancellation Design

To address this, Wormhole has implemented a flow cancellation Governor mechanism. Here's how it works:


Measuring Net Flow

Instead of only considering outflows from each chain, the Governor also considers inflows from each chain. When assets flow in, the Governor reduces the limit utilization, effectively canceling the initial increase in outflows. This means that only net flow (the difference between inflows and outflows) will be subject to the limit.


Net Flow Handling

When a user transfers a fixed amount of assets in and out of a chain, the net flow is zero. The new behavior will identify this and prevent this flow from consuming the Governor limit.


Trusted Assets

The flow cancellation mechanism applies to a subset of stablecoins. This allows for better net flow across supported Wormhole chains while retaining the security of the Governor limit.


Advantages of Traffic Cancellation Governor

When the net flow (outflow - inflow) of a chain is lower than the Governor limit, users will no longer face delays.

Wormhole can support more two-way transaction flow without increasing the Governor limit.

The protocol reduces risk and better protects against vulnerabilities by keeping limits low.

All Wormhole participants (Guardians, Contributors, and Builders) will spend less time on the Governor limit and more time on building the future of interoperability.


Backtest Analysis

In order to evaluate the traffic cancellation strategy, a simulated implementation test based on historical VAA traffic was conducted. The results show that the net flow is significantly lower than the simple outflow strategy, which means that the traffic cancellation strategy will reduce the potential for user delays.


Conclusion

Wormhole's traffic cancellation Governor mechanism provides an innovative solution for multi-chain interoperability. By introducing the concept of net flow, Wormhole not only alleviates transaction delays for users, but also improves the security and efficiency of the platform. With the continuous development of blockchain technology, this mechanism will provide a solid foundation for future multi-chain applications and cross-chain bridging.

In this way, Wormhole not only achieved a breakthrough in technology, but also achieved a win-win situation in user experience and security. For developers and users who are committed to multi-chain interoperability, Wormhole is undoubtedly a trustworthy platform.

Disclaimer:

1. The information does not constitute investment advice, and investors should make independent decisions and bear the risks themselves

2. The copyright of this article belongs to the original author, and it only represents the author's own views, not the views or positions of HiBT