We wouldn’t call it urgent. Ren and wBTC-style-wrapping has already provided this service with other chains just with decentralization issues. wBTC uses a 6 person multisig, which as the price gets higher, so does the incentive to collude which can bring value collapse. renBTC is a fairly decent project, but overcollateralizing their darknodes makes them fairly unscalable. Enter Strudel Finance, which is completely trustless in its wrapper, relying on market risk, rather than collusion risk.
This bridge would of course primarily have the zcash community and its holders in mind. That includes Zcash devs as well. But ideally, it’d be widely adopted in the DeFi landscape. They would be able to trustlessly and privately (meaning without centralized exchanges which collect your data) be able to cross chains and earn interest for providing zcash to liquidity pools, or find harbor in stablecoins, while keeping exposure to the zcash price moments while holding vZEC.
The website and previous bridges are already complete and fully operational, using the Bitcoin.com wallet to tag each bridging token amount (even fractional) with a code that takes it out of circulation on that chain, and gives a unique QR code which can be claimed from the Ethereum side, to mint the vZEC. vZEC can only then be minted with the permanent removal of ZEC from its parent chain. We use a relayer on Ethereum that has by and large been unused even though it was developed in 2017. More technical information about this relayer can be found in our pitch deck and on our GitHub.
Powered by the governance token, Strudel Token (TRDL), Strudel allows BTC, BCH, and other assets to be utilized in the Ethereum and Polygon ecosystems to reap the benefits of liquidity mining, cross-chain arbitrage, and index funds with a goal to incorporate lending and collateralization in the near future.
By eliminating the need for custodial control of assets with typical wrappers, Strudel’s trustless protocol trades counterparty risk (low signature multisigs) for market risk while using market dynamics, crypto-economic incentives, and cross-chain capabilities to maintain a pegged, scalable, and capital-efficient ecosystem.
We’re able to ensure the trustless locking of assets without counterparties, using a relayer protocol on Ethereum. The bridging assets get tagged with code that looks like this (using BTC example)
Since ZEC is a variant of BTC code, we should be able to use the Bitcoin.com wallet and this Ethereum relayer protocol with ZEC and set up markets to begin crossing ZEC, which would then, and only then, mint vZEC, which can be put to work on any liquidity pools on Ethereum or Polygon or BSC (soon). This is technically a one-way bridge, which takes the crossed-ZEC out of circulation on the zcash blockchain, and thus is locked permanently. In exchange for the permanent lock, vZEC would then be minted and claimed on Strudel.finance, and added to your Ethereum wallet. From there you can earn incentives for adding to the market pool for more people to cross and have minimal impact should they sell into different assets. So long as you hold vZEC though, you will maintain exposure to the price movement of ZEC, as markets will buy up vZEC when it is below the ZEC price, or if the price of vZEC exceeds that of ZEC, people can cross and sell to arb this price. Should users wish to get back to ZEC properly, they are welcome to swap for any number of assets available on various DEXs on Ethereum’s ecosystem, and use CEX to get back to ZEC.
Our plan is to create greater means for secure transfer of assets while maintaining privacy. If the bridge isn’t able to be completed it wouldn’t be a dire situation, but certainly unfortunate considering the potential it has. Especially with the added privacy of completely decentralized cross-chain movement that would benefit the privacy and security of Zcash users.