💡 This report has been updated to include new features of Initia, such as PKS (Peg-Keeper-Swap) and VIP (Vested Interest Program). It also provides a detailed recap of the testnet results and comprehensive coverage of the Omnitia ecosystem, along with the latest Minitia additions.

 

TLDR;

• • Initia focuses on addressing UX challenges for both developers and consumers, drawing on proven strategies from the 1970s OS wars.
  • It effectively tackles interoperability, diverse execution environments, and other UX issues by interweaving existing solutions, balancing security with practicality.
  • With over 10 significant Minitias onboard, spanning DeFi, GameFi, and SocialFi applications, Initia, and the larger Omnitia ecosystem, is gearing up for launch following a 12-week intensive testnet period.

 

 

1. History repeats itself: the OS war.

 

Blockchain as an Operating System, on Top of Distributed Systems

Blockchain Mainnets, or so called smart contract platforms can be referred to as an ‘Operating System(OS)’, showing similarities in that while OS manages centralized, closed source hardware to applications, blockchain mainnets manage resources of distributed hardware units so called ‘Nodes’.

Since Ethereum's inception in 2015, numerous L1 protocols have emerged, each vying to become the leading execution platform. As of 2024, over 500 mainnets exist, intensifying the competition to provide superior app-hardware resource management, or a 'Decentralized OS.' This race has further accelerated with the advent of open-source frameworks like Cosmos SDK and OP Stack, each bringing unique approaches and narratives to dominating the blockchain space.

 

OS Wars: The Days of Future Past

< Linux Distribution Timeline, Source: Link >

However, if we look back into the history of OS wars, the trend of having too many diversified platforms didn’t last long. While Windows, Mac, Xhenix, and many more such as C64 Kernel, IBM OS, VMS, Atari DOS, and even including UNIX-based Linux distros* reaching up to 300+ number of OSs in 1977, it eventually converged to a handful list of solid OS platforms. Likewise, some day or another, the competition towards building a decentralized operating system will come down to a countable list of projects with solid foundation.

Looking back on the survivors of the platform war, a tendency rather overlooked in crypto is discovered: The winners of the race prioritized either user experience or developer experience or even both. Such virtue paved the way in building an active ecosystem of builders and users, contributing directly towards the platforms’s success.

 

OS Wars in a glimpse

Different operating systems have taken varied approaches. Linux emphasized open interfaces and packages, fostering a developer-centric ecosystem and becoming dominant in the server OS market as around 39.2% of websites are being hosted on Linux (TrueList). Windows, despite its DOS-based* origins and technical limitations, prioritized end-users** by shipping its OS on various hardware platforms and offering widely-used applications like Microsoft Office, maintaining a strong 73% share in the desktop OS market (TrueList).

Meanwhile, MacOS meticulously planned an integrated ecosystem, balancing developer experience (DX) and user experience (UX). Through a UNIX-based architecture, common development tools, and seamless cross-device features, Apple created a cohesive environment. This resulted in Apple Ecosystem, which has foundations to MacOS boasting the highest ecosystem valuation at over $3.47 trillion. (Companies Market Capital).

 

Success Strategy in Operating Systems: Good DX & UX

In fact, what it really came down to the products’ global success were deeply rooted with these two factors: they either cared (1) the experience of service supplier (in this case - developers, infrastructure operators, etc) or (2) the experience of end users (in this case - dApp users).

Especially - MacOS and its overarching Apple ecosystem exemplify a balanced integration of functionality and usability. Technically, the ecosystem is interwoven through a robust UNIX-based architecture. Adherence to POSIX standards ensures consistent APIs across MacOS, iOS, and iPadOS. The XNU kernel*, combining the Mach microkernel, BSD components, and I/O Kit, provides a unified, scalable foundation to interweave its ecosystem. Development tools such as Swift and Xcode enable cross-platform coding, while HomeBrew and SSH enhance the development and deployment environment.

UX-wise, the Apple ecosystem is seamlessly integrated to enhance user experience. Touch ID and Face ID provide consistent biometric authentication across devices. AirDrop uses Wi-Fi and Bluetooth for easy file sharing, and iCloud ensures data synchronization and seamless backups across all devices. Apple's Human Interface Guidelines** ensure a consistent look and feel across applications, creating a unified and intuitive user experience.

The above example of macOS and Apple highlights what the mainnets of 2024 lack, namely the essence of platform business, which is supposed to connect users to developers. Mostly, it’s developer-first, and even good development ecosystems are fragmented across different mainnets in the name of decentralization. This fragmentation makes it the responsibility of developers and users to understand everything from the ground up.

 

2. Blockchain DX-UX Obstacles

According to Electric Capital's Developer report, multi-chain development trend is becoming dominant in the crypto industry. 30% of developers now support more than one chain, up from 3% in 2015, and 17% support three or more chains.

Despite the growth in the blockchain ecosystem, multi-chain interoperability and the corresponding user-developer experience remain challenging due to a lack of unified infrastructure, execution environments, and user interfaces. Developers face a steep learning curve for each fragmented ecosystem, leading to inefficiencies in application development and maintenance. Users endure a disjointed experience, managing multiple wallets per chain and rollup, navigating different gas fee structures, and manually handling bridging and cross-chain asset transfers. These issues highlight significant barriers to seamless interoperability and user engagement across various blockchain networks.

 

Multi-chain: Interoperability issues

Starting with Interoperability issues, current situation historically parallels the compatibility issues occurred in previously mentioned OS wars. DOS and UNIX had fundamentally different file systems* (FAT vs. ext2/3/4), executable formats (PE vs. ELF), system calls, and user interfaces. While DOS used a simpler, single-tasking environment with FAT file systems, UNIX supported multi-tasking and used hierarchical file systems with POSIX-compliant system calls. These differences made cross-platform software development arduous, introducing interoperability layers and solutions** such as POSIX and middleware Cygwin to bridge these gaps.

Similar fragmentation is happening with mainnets and rollups. Between different L1 mainnets with it’s own unique execution environment, there’s Execution Compatibility issue. Even with same EVM based execution environment, some rollups require additional verification / proving layer which requires thorough testing and adjustments. Also Bridging Experiences are horrible: moving assets and data between L1 and L2 or between different L2s typically requires complex bridges or messaging solutions. These layers can introduce points of failure or vulnerability, requiring robust security and reliability measures, hard to be implemented and handled by group of application builders.

A good example of this is The IBC Dilemma . While Utilizing IBC (Inter-Blockchain Communication) in Cosmos ecosystem features trustless, consensus level asset bridging, this can lead to issues with endless denominated assets, complicating asset management and increasing the risk of errors in cross-chain transactions.

 

DX-UX Concerns

Besides interoperability issues, the lack of infrastructure-level support for both developers and users presents significant challenges in the crypto space. For example, oracles are essential since blockchains are inherently closed systems that require external data endpoints to access off-chain data. Additionally, while developers should focus on building efficient business logic, they are rather overwhelmed by the limitations of specific virtual machines (e.g., EVM, CosmWasm, MoveVM), forcing them to adapt their work rather than developing freely without worrying about platform support. Consequently, deploying a rollup or launching a decentralized application involves preparing oracles, setting up execution environments, and necessitates developer SDKs and frontend widget toolings, which are crucial for efficient development and deployment - a massive overhead for developers in general.

< A glimpse of horrible UX on Microsoft Word back in early 2000s >

For users, infrastructure gaps result in poor UX, reminiscent of early OS challenges where users relied heavily on CLI due to the lack of GUIs. Today, blockchain users face similar hurdles. Each chain and rollup has its own suite of wallet extensions, native bridges, and gas fees, forcing users to research each chain before interacting, leading to a fragmented bridging experience. Additionally, numerous other issues affect users, such as the lack of safe native stablecoins, on-off ramp solutions, social logins, and improved gas UX, like gasless payments or using other tokens for gas fees. Ultimately, these burdens fall not on mainnets or rollups but on the users themselves.

Who’s addressing these critical issues, the essence of platform business? It’s Initia. As a Layer 1 settlement layer, Initia is designed to solve the aforementioned problems by ‘interweaving’ necessary solutions. This approach provides builders and users with a hassle-free experience, addressing the current bottlenecks of interoperability, infrastructure, and poor UX.

 

3. Solution: Interweave

While many crypto projects fail to define a problem, often inventing issues to fit their solutions, Initia clearly identifies the core issues of interoperability and poor UX/DX. By leveraging existing, proven advanced technologies to address these challenges, Initia positions itself as a problem solver, not a creator of unnecessary problems.

 

3-1. Interweaving Existing Solutions

3-1-1. Fixing Rollup Interoperability

 

Current hurdles in rollup interoperability

Starting with Initia’s answer to the interoperability problem, let’s dive into a cross-rollup transaction assuming that layer 2 network L2(A) has sent a cross-rollup transaction to layer 2 network L2(B):

A typical cross-rollup transaction from L2(A) to L2(B) would undergo two transactions: (1) L2(A) → L1, and (2) L1 → L2(B). However in the current bridging environment, a fragmentation problem occurs. This forces users to either wait for the withdrawal transaction of 7 days for an optimistic withdrawal to settle, pay excessive fees for ZK Provers, or incur an additional risk premium* for third-party bridges.

To solve this, Initia is natively implementing cross-rollup interoperable bridges, by utilizing a native optimistic bridge in collaboration with Hermes Relayers(IBC) and Minitswap to achieve fast withdrawals and routing services. It does so by (1) Using an optimistic bridge to deposit assets to L2, (2) Relaying via Hermes (IBC) to withdraw assets back to L1, then (3) Finalizing interchain transaction by swapping the denominated asset to a native asset via L1 Minitswap Pool.

 

Omnified Bridges: Native OPInit Bridge + Hermes Relayers (IBC) + Minitswap

The first step of routing, the initial deposit from L1 Initia to L2 Minitias, is straightforward: it utilizes native OPinit bridges. However, when withdrawing assets back to L1, Initia employs Hermes Relayers (IBC*) to ensure instant, fast withdrawals from L2. For example, if Minitia 'A' sends deposited $INIT via the native optimistic bridge, one can instantly deposit from 'A' to Initia by minting $[A]INIT tokens. Since these IBC transactions are made in a one-way descending direction, this approach cleverly avoids the problem of aforementioned-endlessly-denominated-assets, as such IBC transfers always pass through L1 Initia.

However, since the minted $[A]INIT tokens are not native $INIT tokens accepted on L1, another transaction on L1 via the Minitswap pool** is executed to finalize the withdrawal of $[A]INIT to $INIT. Through Minitswap, Minitias can achieve instant settlement on the L1, using native $INIT tokens deposited in the Minitswap pool to be swapped via withdrawal requests made from the L2 Minitia. The whole process of bridging $[A]INIT via IBC and settling it on Minitswap functions as a fast-withdrawal service at the user’s level.

 

Balancing Efficiency and Security in Cross-Rollup Transactions

Initia addresses the interoperability problem with a hybrid solution that combines the native OPinit Bridge, an IBC relayer, and opINIT<>opIBCINIT vAMM pools. This approach strikes a practical balance between security and user experience (DX-UX), enabling efficient cross-rollup transactions. Although the system is not without challenges—such as inherent liquidity fragmentation and potential attack vectors* by rogue Minitia operators (if any) —the Initia team is continually refining the solution, with the PKS (Peg Keeper Swap) serving as a notable example of these improvements.

In addition, programs like the Initia VIP and the Enshrined Liquidity** significantly lowers the likelihood of Minitias going rogue as it operates as a strong incentive alignment mechanism, creating greater bonds and therefore economic stability between Initia and Minitias.

 

 

3-1-2. Making DX-UX great Again

 

InitiaVM: A developer-friendly execution layer of choice:

Besides Interoperability issues, Initia also offers a streamlined development layer akin to a "rollup Firebase" or BaaS, freeing developers from execution environment concerns. This infrastructure, referred to as the ‘InitiaVM’ allows developers to focus solely on their application and business logic. Like how Firebase supports SDKs for various platforms, InitiaVM supports the Interwoven stack for diverse execution environments, including EVM, WasmVM, and MoveVM.

A notable feature is Initia’s support for MoveVM, a rising* Rust-based programming language designed to create a parallelized execution environment. Initia currently supports Aptos's Move** lineage, which aligns with the Comet-BFT consensus mechanism. This demonstrates Initia’s commitment to supporting emerging technologies and creating a universal developer layer.

 

Skip Slinky: Chain Integrated Oracle Infrastructure

While Initia provides a comprehensive suite of infrastructure packages, the Skip Slinky sidecar* oracle is a must-mention. Slinky is an oracle sidecar that leverages the security of a chain’s validator set, specific to the Cosmos ecosystem, with minimal external security assumptions, supporting up to 2000 token price pairs. It is a leading oracle solution used in CometBFT-based DeFi-prioritized mainnets such as DYDX, Berachain, Neutron, and many more to come.

With a robust oracle engine implemented and interwoven with L1 validators, L1 Initia apps can fetch data on the x/Oracle module. Additionally, L2 Minitia rollups can access oracle data protected by chain-level security, fetched by the OPinit-bot integrated within the Interwoven stack.

 

Omnified Bridging & Managing Experience

At last, with strong emphasis on user experience, Initia redefines the user experience by interweaving rollup interactions, enhancing how users bridge, send transactions, and manage assets. Traditionally, users faced chain-specific bridges and wallets causing fragmented UX and sometimes another layer of third party risks if the user wants to bypass the discomfort.

Initia’s integrates a guided bridge and this eliminates the need for external bridging solutions, restoring ownership of bridges to users and the underlying ecosystem from L2 rollups.

Moreover, Initia’s wallets allow users to browse assets on both L1 and L2 rollups. Assets on L2 are indexed by rollup-universal indexers, providing a seamless, omnified user experience that makes users Initia, and L2 Minitia as a single Omnified asset ecosystem.

While Initia offers numerous UX improvement features, application level UX extensions such as Just-in-Time (JIT)**, and native USDC*** support are another huge standouts that greatly improves UX on Initia. While JIT enables users to pay gas fees with any token, USDC from the Noble appchain mitigates the risks associated with synthetic stablecoins.

As a result, Initia positions itself as a L1 settlement layer designed to interweave necessary solutions, offering a hassle-free developer and user experience by addressing interoperability, and DX-UX challenges.

 

3-2. The Interwoven Future: Omnitia

Now that we understand the fundamental DX-UX discrepancies in current rollups stemming from interoperability issues and how Initia intends to solve them, let's contemplate the broader picture on how the wider ecosystem of L2 rollups and L1 Initia, called 'Omnitia,' functions with its moving parts.

 

3-2-1. Omnitia: Initia + Minitia + Other Modules

< Omnitia Diagram, Source: Initia >

Omnitia refers to the entire ecosystem that includes: (1) Initia (L1) as a foundational settlement layer, (2) Minitia (L2) as an application layer, and (3) other infrastructure-level modules like the DA and interoperability modules like Celestia and LayerZero. These moving parts are meticulously 'interwoven' to provide a seamless interface for both developers and users.

 

3-2-2. Omnitia’s Orchestration Layer - Initia L1

Initia is a L1 settlement layer for Minitia, a modular layer-2 framework based on the Interwoven Stack, the L1 is equipped with Comet BFT(Tendermint)* as it’s consensus engine. One unique feature of Initia is that it has implemented a native execution environment for the Move programming language as one of its modules.

On top of Initia, infra-level applications are built with vanilla Move, dApps such as InitiaDEX, a native DEX that enables its core infrastructure features such as Minitswap and Enshrined Liquidity, and the aforementioned Omnitia Routing Service are all implementations built with Move. Also, Initia L1 operates as an external Bridging layer for Minitia, hosting the LayerZero’s module for enhanced interoperability, connecting other Cosmos-based external bridges such as Axelar via IBC to bridge other ecosystems like Solana and Aptos, making Initia a truly active liquidity-interoperability layer for Omnitia.

 

3-2-3. Omnitia’s application layer - Minitia L2

Minitias are sovereign L2 rollup instances on Initia, constructed utilizing the Interwoven Stack, a rollup framework inspired by Optimism Bedrock and based on the BlockSDK (Cosmos SDK). The Interwoven Stack features a swift 500ms blocktime and are notable for their extensive customizability. It also supports the development of VM-agnostic Optimistic Rollups, allowing each Minitia to tailor its execution environment and other stack components to suit specific business needs over rigid network infrastructure standards.

At the consensus level, CometBFT's parameters can be fine-tuned to optimize validator participation. For sequencing, Minitia offers flexible options, including the use of a proprietary sequencer or third-party decentralized/shared sequencing solutions. At an application level, Minitia supports the integration of advanced rollup functionalities and standard Cosmos SDK modules such as AuthZ and Feegrant, alongside custom modules like the POB from Skip Protocol, enhancing its architectural versatility and functionality as a sovereign rollup. For better UX, It also provides the autonomy to select preferred tokens (JIT, Just-In-Time) for transaction fee payments within its network.

< L1-L2 Batch Submission Diagram, Source: Initia >

The way how L2(Minitia) and the L1 settlement (Initia) interact* is well illustrated by dividing the OPinit module into two submodules: the ophost module and the opchild module. The ophost module handles L1 activity interfaces such as bridging and executions, while the opchild module manages L2 activities such as execution and withdraw and deposit operations. To ensure a safe and secure execution environment within the rollup-settlement architecture, batches of L2 transactions are submitted to both Initia L1 and Celestia DA. Then Batched transactions are recorded as data blobs on both L1 and Celestia DA, effectively fullfilling the casual definition** of a ‘rollup’.

 

3-2-4. Omnitia’s Infra Modules(1) - Celestia & OSS

Along with chain-integrated Skip Slinky Oracle, Omnitia incorporates various infra-level modules, with Celestia DA being its first DA service provider. Celestia functions as a fault-proof 2FA Data Availability (DA) archive for Minitias in case of a successful challenge event. If challenge proposal is submitted and passed on to L1 Initia, Celestia is trusted as a source of truth for newly deployed L2 operator(executor) for Minitia reconstruction. In addition, with Celestia’s data blob compression (a.k.a erasure coding) and NMT(Namespace Merkle Tree), Minitias can later query whatever execution data in the efficient archive. This symbiotic relationship between Initia, Minitia, and Celestia is referred to as OSS(Omnichain Shared Security)

 

3-2-5. Omnitia’s Infra Modules(2) - LayerZero on Initia

To complete the creation of a robust and stable infrastructure, the introduction of the LZ module, co-developed by LayerZero and Initia, marks a milestone in achieving better interoperability and modularity.

While the module follows the relayer-oracle architecture initially devised by LayerZero, this time the module is implemented in the form of Block SDK (Cosmos SDK) modules* rather than their classic smart-contract approach. As a result, the module is execution-agnostic, and this versatility is crucial as it extends compatibility to Minitias that use EVM, MoveVM, or WasmVM, all of which are built on the Block SDK (Interwoven Stack has it’s bases on the Block SDK).

While the specific details regarding Minitia access to the LZ module are still being finalized, it is anticipated that this module will provide every interwoven Minitia with seamless access to LayerZero's Omnichain Messaging Protocols (OMP) and the Omnichain Fungible Token (OFT) standards right out of the box.

 

To summarize, Omnitia's strategic approach effectively addresses and provides solutions for interoperability and current DX-UX hurdles, creating a meticulously woven ecosystem consisting of Initia, Minitia, and other infrastructure modules like Celestia and LayerZero. While the network's foundations appear promising, building a robust user base will become crucial as RaaS platforms like Initia at it’s core is a platform business. In this context, the actual consumer-level value of applications and Minitias are essential to foster ecosystem growth. Looking ahead, we delve deeper into various L1 applications, Minitias and the networks stats extracted from 12-week extensive testnet.

 

4. Interwoven Applications

4-1. Core Proprietary Applications within Omnitia

As mentioned, Initia strategically follows Apple's successful framework. However this is built across not only within its tech stack but also within its product offerings all in the purpose of delivering a unified chain experience akin to a single system operation. Just as Apple enhances user experience via exclusive, seamlessly integrated applications like Airdrop, iCloud, and FaceTime across all its devices (Macbook, iPhone, iPad, Apple Watch, etc.), Initia has also launched its own suite of tailored applications—including wallets, apps, and scanners—to enrich interactions within the Omnitia ecosystem.

• InitiaScan: A multi-chain explorer with VM-specific tools and information.
• Wallet Widget: Supports EVM & Cosmos wallet signing and includes social login features.
• Initia Bridge: A frontend bridge/on-ramp aggregator integrated directly into Minitias.
• Initia App: A centralized platform for all things related to Initia.
• Initia Usernames: A blockchain-wide on-chain identity system.
• Initia Wallet: A dedicated wallet designed for navigating the expansive Initia ecosystem.

This strategy not only addresses the potential fragmentation among Minitias but also guarantees robust integration and standardization of foundational applications throughout the network, akin to more cohesive ecosystems. Furthermore, the apps are crafted to be intuitive and user-friendly, facilitating ease of use and reducing the learning curve in the complex blockchain environment.

 

4-2. Notable Minitas within Omnitia

While Apple provides a suite of proprietary applications, its ecosystem thrives thanks to a wide range of powerful, consumer-focused apps and services developed by third-party creators. Initia seems to be adopting a similar strategy, making it essential to attract and onboard significant Minitias within its ecosystem. In this section, we'll focus on this crucial aspect, highlighting the importance of bringing impactful Minitias into the fold. With over 12 projects already onboarding or planning to engage with the Omnitia Ecosystem, our attention turns to the first batch of Minitias we want to spotlight: DeFi Projects.

4-2-1. Blackwing, The Modern-day DEX Abstraction Layer

First on the list is Blackwing, a Minitia that facilitates trading for long-tail assets across multiple chains, including EVM (Arbitrum), Solana, and Cosmos (Initia). Blackwing introduces an innovative concept called Limitless Pools*, which allows for liquidation-free perpetual trading with leveraged long-short positions of up to 100x. With the Limitless Pool, Blackwing aims to create perpetual markets for asset classes characterized by high volatility and low liquidity, even including memecoins on Solana.

Besides liquidation-free limitless pool trading, Blackwing also supports Classic Mode margin trading for those who want to trade assets that aren’t supported by Limitless Pools, and uses an intent-solver architecture for order fulfillment to better facilitate cross chain trading. Blackwing namely implementing this architecture for both Solana and Initia.

As of August 28th, 2024, Blackwing has surpassed a Total Value Locked (TVL) of $69M and $5B in trading volume - with almost 100K users onboard. Blackwing’s mainnet launch is scheduled to be released in the second half of 2024. The platform has successfully raised $4.5 million in seed round funding from notable investors including Hashed and GUMI.

 

4-2-2. MilkyWay, Modular Staking Portal for LST and Restaking

Launched at Q4 of 2023, MilkyWay was originally a liquid staking and a restaking solution for the Celestia ecosystem. Enabling users to receive an on-chain representation of their $TIA staking position, known as $milkTIA when they liquid stake their $TIA with MilkyWay to empower Celestia token holders to have greater access* liquidity for their staked assets.

MilkyWay began as a non-sovereign, smart contract** based restaking portal for the modular ecosystem, but it has since evolved to launch its own chain using Initia’s Interwoven stack as its foundation. Additionally, MilkyWay has integrated $INIT tokens into its ecosystem, allowing $INIT stakers to restake through MilkyWay for potentially higher profits or rewards from AVSs like Tucana. The recent launch of Rapid Restaked Relayers***, developed in collaboration with Initia, further demonstrates the deep integration of MilkyWay’s infrastructure within Initia and the broader Omnitia.

As of August 29th 2024, Milkyway has acquired more than 4k Transfers and achieved a total transfer volume of $2.5M USD. Milkyway has successfully raised $5M in seed round funding from notable investors such as Polychain Capital, Binance Labs, HackVC, Crypto.com, and more.

 

4-2-3. Tucana, an Intent-Centric Liquidity Layer

Tucana is an intent-centric liquidity layer, DEX, and a DeFi-specific* app chain built with the Interwoven Stack. Tucana implements it’s own consensus called PoTV (Proof of Tradable Value) which enables users to restake LPs of mainstream native modular chain asset to secure the chain - in the purpose of unlocking vast amounts of modular assets currently idle in CEX or POS nodes into active on-chain liquidity. Powered by IBC, Tucana aims to create an environment where users can initiate their swap or limit order requests from any modular networks and have their orders executed by the aggregated liquidity on Tucana.

In essence, the PoTV (Proof of Tradeable Value) module integrates the value of LP tokens as a critical component of stake** in the Tucana Chain's consensus mechanism. Tucana is also an Actively Validated Service (AVS) of the MilkyWay protocol, leveraging MilkyWay as a multi-validating solution, combining its own PoTV consensus with the economic security provided by MilkyWay’s re-staked LSTs and staked assets. This approach aims to enhance the overall security and robustness of the Tucana Chain with its experimental consensus mechanism.

As of August 26th, 2024, Tucana’s Spot DEX has processed over 11M+ transactions and $17B in cumulative volume with TVL up to $2.9M on the Initia Testnet. With a team of experience in building and growing products in DeFi, The Tucana project is expecting a huge rebranding before it’s mainnet launch.

 

4-2-4. Contro, a GLOB-based Prediction Market

Contro is developing its unique GLOB (Gradual Limit Order Book) trading architecture that will be leveraged by a flagship prediction market app AcroBet. The GLOB redefines the concept of an order by treating it as a continuous stream of trades, similar to a Time-Weighted Average Price (TWAP). Unlike traditional order books, where orders may be filled instantly, in a GLOB, matched orders fill during an interval of time set by the trader. This approach creates uniformity* across the global state, ensuring that all users receive the same clearing price at any given moment. It also facilitates robust peer-to-peer (P2P) trading without the need for traditional market makers or liquidity providers.

Prediction markets like Polymarket have quickly gained popularity among users looking to bet on off-chain events with on-chain assets. However, providing liquidity in non-GLOB markets may be too risky** for prediction markets and sometimes left heavily and unsustainably incentivized. In contrast, the GLOB architecture was devised to minimize the importance of timing and the ordering of transactions in time and protects liquidity of all participants from sniping and other extractions, having the potential to mitigate many extractive HFT strategies.

Moreover, the GLOB facilitates direct matching between both sides of the market through aggregated P2P trading, removing the need for liquidity providers as intermediaries. Ensuring that every trade is consensual and transparent makes the GLOB an ideal mechanism for building a prediction market where the information is asymmetrically distributed, and possibly revolutionize finance on- and off-chain in the broader sense in the long run.

 

4-2-5. Inertia, Modular Lending & Asset Management Platform Focusing on LRTs

Inertia, built on the Interwoven Stack and leveraging Celestia's Data Availability (DA), is a comprehensive yield management platform with a primary focus on Liquid Re-staked Tokens (LRT) and a modular lending market. At launch, users will have the ability to lend and borrow assets within its lending market, as well as stake native $INIT tokens and restake Liquid Staking Tokens (LSTs) via its staking and restaking portal. These LSTs can be converted into LRTs, which can then be used as collateral* within the lending pool, allowing users to borrow additional assets.

A key feature of Inertia is its integration with MilkyWay. All LSTs on Inertia can interact with MilkyWay to benefit from restaking yields while simultaneously minting LRTs. This modular architecture allows Inertia to tap into MilkyWay's expanding support for assets, incentivizing users to use MilkyWay as the go-to restaking portal for the modular ecosystem. Additionally, Inertia offers native $INIT liquid staking services. Users can stake their $INIT through Inertia’s liquid staking module, modeled similarly to the $frxETH-$sfrxETH tokenomics**. In this model, $nINIT is the liquid version of staked $INIT, while $sINIT accrues staking rewards akin to how $sfrxETH does for $ETH.

With these features combined, users have the potential to maximize their profits through various strategies. For example, a user could convert $INIT to $nINIT, earn additional restaking rewards accrued in $inrtINIT, and then collateralize those tokens to borrow more $INIT, thereby re-engaging the system and increasing their leverage. This "flywheel" strategy allows for significant leverage using staked assets.

At launch, Inertia aims to capture over 70%*** of all LRT assets on Initia, comparing its potential dominance to that of Ether.fi and Renzo in their respective early phases. The platform also plans to launch its prototype and incentivized testnet by the end of October.

Initia Mega Report - Inertia

 

4-2-6. Civitia, Monopoly-inspired Game-Fi

Civitia is a gamified social dapp leveraging Initia's modular blockchain and Celestia's modular data availability network, where users acquire land, earn yield, and compete or collaborate with other players under the constraints of a social and financial game*. Similar to Monopoly, users have the opportunity to mint cities and become on-chain landlords by earning rents from other players. In the GameFi context, users gain $GOLD as they pay taxes in the form of TP (Tax Points), or contribute to the game’s development.

< In-Game Screen During Testnet, Source: Civitia >

Since its testnet launch on June 1, 2024, Civitia has successfully garnered over 300K users while processing a whopping 9.7M transactions as of August 30th, 2024. After gathering testnet player activity during the initiation-1, Civitia’s mainnet release is expected to include a whole new set of features and mechanics. Players will need to select a place of residence from their city portfolios in order to participate in seasons (bi-weekly competitions) and fight for rewards between communities. The gamified experience is also planned to expand with the launch of special squares featuring on-chain innovative mechanics like jail, bunker, bank, and tax square.

Civitia’s launch is expected to happen alongside Initia's mainnet and will be rolled out in two consecutive phases: the Lobby phase (an incentivized stage where players bridge INIT over Civitia L2 and wait for the game launch), and the Launch phase (the official game release).

Players need to rebuild it by collaborating both socially and financially within communities while seeking the best possible individual outcome. Civitia inherits both capitalism (free market, supply/demand pricing) and socialism (wealth tax, rent regulation) mechanics, simulating a real-world environment of the modern era.

*Civitia originates from Civitas (Latin: a body of people constituting a politically organized community), where its lore is based on the idea that planet Earth has suffered a nuclear attack and civilization is destroyed.

 

4-2-7. Kamigotchi, Gotta gotchi them all!

Kamigotchi is a Fully Onchain (FOC) MMORPG developed by Asphodel Studio, designed as an "autonomous world"—a decentralized virtual environment intended to operate indefinitely. In the game, players manage pet-like NFTs called Kamigotchi, each with unique traits and stats that can be leveled up and developed over time. Kamigotchi are categorized into four types: Normal, Insect, Eerie, and Scrap, each with specific strengths and weaknesses in a rock-paper-scissors dynamic. For example, Insect beats Eerie, Eerie beats Scrap, and Scrap beats Insect. Additionally, each Kamigotchi has basic stats, including Health, Power, Violence, and Harmony, which influence their performance in various aspects of gameplay.

< Type Effectiveness System, Source: Kamigotchi >

Players explore different rooms, farm resources, craft items, and gradually increase their Kamigotchi’s power. The core mechanic features an idle-PvP loop, where Kamigotchi passively gather resources but are vulnerable to attacks from other players while doing so. This is implemented to boost balance between resource collection and defensive strategy, requiring players to consider the risks of being targeted by others.

The project aims to create one of the first fully on-chain MMORPGs, with the goal of living on its own Minitia—a decentralized, self-sustaining world. However, the long-term success and sustainability of such a fully autonomous game will depend on how well these mechanics are received and supported by the player base over time.

 

4-2-8. Lunch, A Hands-on Web3 Activity Hub

Lunch is a mobile-first, gamified platform designed for on/off-chain questing and liquidity management, offering an accessible way for users to engage with Minitias on Initia. With mobile being the dominant medium for apps like streaming, gaming, and fintech, Lunch aims to capitalize on this trend by providing a user-friendly interface that simplifies onboarding and encourages engagement. Its focus on mobile accessibility positions it as a potential solution for those seeking rewards and airdrop opportunities within the crypto space.

< In-App Mockup Screen, Source: Lunch >

For developers, Lunch offers access to a large, active user base with its natural Sybil resistance helps ensure that rewards are distributed to real users engaged in authentic on-chain interactions. This has potential to make Lunch a useful tool for both user acquisition and reward distribution for protocols looking to grow their presence.

The core of Lunch’s ecosystem will be Eggs, a native reward system earned by completing quests and participating in activities. Eggs can be used for benefits like airdrops, roulettes, or converted into $LUNCH. Lunch also plans to run Egg Leagues, rewarding users based on activity over time.

< Lunch Economy Infographic, Source: Lunch >

Looking ahead, Lunch will introduce a liquidity marketplace with preferential yields, positioning itself as a bootstrapping solution for protocols seeking liquidity. Additionally, it aims to expand into ecosystems like Movement and other L2 EVMs, while maintaining its core as an Interwoven Stack to reach a broader user base.

 

4-2-9. Zaar, A Fun Mobile-Friendly NFT-based Casino

Zaar is a casino-centric platform inspired by the concept of a "Grand Bazaar," designed to unite a diverse gaming community on a single, inclusive platform. While adopting a revenue model similar to other gaming platforms, Zaar focuses heavily on creating a seamless, mobile-friendly experience with features such as Telegram trading bots. Formerly known as Protectorate Protocol, Zaar integrates with Initia’s Interwoven Stack to develop a Progressive Web App (PWA), making it easily accessible from mobile devices. The platform aims to provide engaging games and opportunities for users to participate in a wide range of activities, including staking mechanisms that allow them to generate yield from their participation.

Zaar’s staking mechanism is particularly central to its platform, allowing users to act as the "house" for games like Zaar Flip. This system enables the platform to scale its liquidity while providing attractive incentives for stakers. The staking flow works by users staking $INIT, which contributes to a pool that receives a portion of the platform’s overall revenue. This revenue is distributed pro-rata to pool participants, with all yield currently paid in $INIT. Stakers also earn Zaar XP, which is Zaar’s scoring mechanism that can lead to Initia VIP status, offering further rewards in esINIT.

It’s worth noting that staking on Zaar will come with some risk, similar to models like HLP (Hyperliquid) or GLP (GMX). If users’ overall win rates are higher than average during a particular time, stakers could lose a portion of their staked amount, as they are providing liquidity in exchange for a share of the house edge. However, the games are designed to be mathematically profitable for the house in the long run. Zaar plans to implement Skip Slinky for Verifiable Random Function (VRF) to ensure fairness. Additionally, the platform is working on finalizing a robust rake-back system, which will include an NFT collection for boosted rake-back based on rarity, and a rewarding VIP scoring system for users who consistently stake $INIT and participate in Zaar’s games.

 

4-3. Vested Interest Program: A L1-aligned Minitia

As we reviewed various Minitia, ranging from DeFi, GameFi, and NFT markets, it's clear that the Omnitia ecosystem will host a wide array of stakeholders. However, reflecting on Ethereum's rollup-centric ecosystem, we see that incentive misalignment has often led to a lack of collaboration between rollups, resulting in fragmented standards, slower roadmap execution, and ultimately discrepancies between user experience (UX) and developer experience (DX). These concerns are also relevant to the Omnitia ecosystem, where the presence of highly customizable sovereign Minitias makes a sophisticated incentive alignment program crucial.

The VIP (Vested Interest Program) is Initia’s solution to this challenge. It acts as an incentive framework that weaves together the interests of Initia, Minitia, and their users. Designed to operate over several years, the VIP’s incentive scheme is divided into two stages for each distribution phase. In the first stage, $INIT tokens are distributed to Minitia based on their Total Value Locked (Balance Pool) and their users’ participation in governance through Gauge votes (Weight Pool). In the second stage, rewards are distributed to users based on scores determined by standards, or so called KPIs set by each Minitia.

< VIP Distribution of $INIT, Source: Initia >

In depth, the Balance Pool tracks the $INIT TVL on each Minitia, assessing their ability to attract liquidity. Meanwhile, the Weight Pool monitors how effectively Minitias encourage user participation in gauge votes. For users, the goal is to satisfy Minitias, which in return reward back with $esINIT** VIP rewards based on KPIs*** submitted via respective Minitia for that reward stage.

Additionally, users can engage in lock-staking, also known as "zapping." This allows users to lock their $esINIT rewards while they are being vested. By zapping, users can combine their locked $esINIT with another asset in the InitiaDex, creating a native staking position that earns both native staking rewards and swap fees, along with a boosted reward rate. This process also benefits the Initia L1 by increasing liquidity through these locked staking positions.

< Lock-staking (Zapping) of $esINIT, Source: Initia >

 

Incentive Structure from Initia, Minitia to User, but at a chain level.

An exciting aspect of this system is its similarities from the Curve Wars of 2021 DeFi summer, where bribe-and-distribute models, also known as ve-Tokenomics, became a staple in the tokenomics playbook. These models foster competition among participating entities while simultaneously driving significant growth across the entire economy.

However, applying this approach at a chain level, as Initia is attempting, is an ambitious and unprecedented initiative. If executed successfully, it has the potential to create substantial positive-sum outcomes. Nonetheless, it will be important to closely monitor how these incentive mechanisms and stakeholders interact, both within individual rollups and across the broader Omnitia ecosystem.

• Tucana:

  • Swapping on the spot DEX (Tucana Chain)
  • Adding liquidity on the spot DEX (Tucana Chain)
  • The amount of TLP minted or bought on the perp DEX
  • Trading activity on the perp DEX
• Civitia: Amount of GOLD earned by using Tax Points to rebuild or sabotage cities
• Blackwing: Trading on Blackwing using USDC and BUSD
• Lunch: Claiming Eggs - Completing various missions to earn Eggs on the Lunch App
• MilkyWay: Liquid Staking - Staking INIT to mint milkINIT on the MilkyWay Testnet

 

5. Initia’s Extensive Testnet: The Initiation

5-1. Testnet at a Glance

Initia recently conducted a 12-week testnet campaign, divided into two distinct phases. In the first phase, users participated in the Build-A-Jennie NFT campaign, where they completed various missions to earn points and nurture the beloved mascot Jennie into its master avatar form. The second phase shifted focus towards engaging these users with ecosystem-level mechanics such as the VIP and MinitSwap, which required a deeper understanding. Successful participants were rewarded with Stickers for their achievements.

< Initiation-1 Week 4 Recap, Source: Initia >

The 12-week testnet campaign has successfully concluded, with Initia onboarding 7 projects during the public testnet phase. As of August 30th, these initiatives have driven considerable activity, resulting in over 126 million transactions and 2.9 million active wallets—defined as those with at least one transaction. We now turn to a comprehensive analysis of the testnet statistics.

 

5-2. Analytic Recap

Testnet data can often be volatile, with accuracy and reliability of data sources typically unstable during this phase across any network. Therefore, we encourage you to examine the statistics not with the intention of rushing in after the mainnet launch, but rather to get a grasp of how the testnet unfolded. Due to possible discrepancies in the testnet data—largely due to bot attacks* and unstable network conditions during the early stages—we have limited the scope of observation to the period from June 15th to the conclusion of the testnet on August 13th.

*These bot attacks were swiftly addressed by the Initia team, who implemented an on-chain proof of humanity using Gitcoin Passport, along with $GAS tokens that are non-swappable and can only be transferred via native transactions.

 

5-2-1. End result Summary

In reviewing the testnet's final results, we observe that during the 12-week period, approximately 63.5% of all transactions took place on Initia, while 36.5% occurred on Minitia. The application generating the most transactions on Minitia was Tucana, accounting for nearly a quarter of all transactions on Minitia during the testnet phase. Please note that this distribution does not indicate the superiority of one chain over another, as the average value per transaction* will greatly vary significantly depending on the nature of transactions on each chain.

 

Minitia Usage Increase During Testnet

Additionally, while the slide presented shows cumulative transaction counts, it's important to note that Initia's daily transaction count dropped significantly from 59.3% (June 3nd) to 32.1% (August 13th). This decline mirrors the trend observed in Ethereum's rollup-centric ecosystem, where Layer 1 transaction volumes have similarly decreased.

*On-chain games typically have a low average value per transaction, whereas DeFi tends to have a higher average value per transaction. Meaning more transactions does not necessarily mean that there’s more value in that chain / app. User apps usually have lower value-per-transaction than DeFi applications.

 

5-2-2. User Level Summary

Next we peep into user activites, to be precise, stats divided by active users. Here at the user level, we peek into two metrics (1) Transactions per Account then (2) TVL per Account.

(1) Transactions per Account

While this metric Indicates the average activity level per user - meaning high ratios suggest active engagement or stress testing and low ratios might indicate broader but lighter use across accounts. The most contender of TX/Accounts was base layer Initia, but Minitias brought up much user interaction as well. Minitia such as Blackwing and Lunch showed positive growth and especially Civitia showed extensive growth during the testnet period among others.

(2) TVL per Account

TVL, in other words Total Volume Locked per Account shows the average value each user is locking in to the network, while higher ratios suggest greater user commitment and trust on each Omnitia ecosystem entities, this may come down to as a useful metric to simulate user actions on the mainnet. This is particularly relevant considering how VIP implements the Balance Pool to distribute $esINIT tokens to Minitia. As real users begin utilizing real assets on the mainnet, this metric can serve as a valuable reference for projects to predict how much user trust and assets are tied into one another.

 

6. Conclusion

The year 2024 has been pivotal for the crypto industry, as the once-hostile macroeconomic environment is finally shifting. The approval of Bitcoin and Ethereum ETFs, signs of potential rate cuts, and increasing regulatory clarity are all contributing to a more favorable landscape. However, the real essence of the crypto space lies in the rapid evolution of blockchain infrastructure. The continuous release of innovative consumer applications and services is strengthening the core fundamentals of the digital asset market, laying a solid foundation for its sustained growth. At the same time, this growth is fueling fierce competition among various mainnets—effectively decentralized operating systems—each vying for users by showcasing their distinct advantages.

In this competitive landscape, Initia is steadily emerging as a noteworthy contender, drawing parallels to Apple's rise to global prominence during the OS wars of the late 1990s. Though still an early-stage Layer 1 blockchain without a proven track record, Initia has skillfully tackled key challenges like interoperability within the rollup ecosystem and has significantly improved the user experience for both developers and consumers. Additionally, it has onboarded 10+ partners—referred to as Minitias—forming a strategic alliance under the banner of Omnitia. These accomplishments provide compelling reasons to believe in the future potential of Initia and Omnitia. And let’s not forget Jennie the dog, an endearing cultural mascot who has been part of the journey since day one.

<Jennie’s favorite food is known to be the “Fillet Mignon”>