In this article, we shall see how bank’s market share in global payments is threatened by emerging technologies like stablecoins, the challenges they face to compete with them  and the solution that blockchain can provide to banks  in this regard to resolve their existing issues; 

According to the IMF’s January 2025 report, banks have become the most expensive gateway for cross-border payments. With cross-border spending projected to reach $320 trillion by 2032, banks face existential pressure to innovate or lose market share.

The threat is real. Approximately $27 trillion remains trapped in correspondent banking accounts, creating a $1.22 trillion annual “liquidity tax.” Meanwhile, stablecoins moved $27 trillion in 2025 with 733% B2B payment growth, and Ripple secured 75+ global licenses in February 2026.

This article examines how stablecoins threaten banks’ market share, the structural challenges banks face, and how blockchain provides solutions.

Stablecoins: The Bullet Hard To Dodge For Banks To Dominate the Cross-Border Payments 

At the moment, more than 40% of the banks  are in the position to lose 5% of the market share to next gen payment advancements like stablecoins.  And this trend has already started in the US and the UK, where stablecoins  have already occupied  1% of the total remittance and moved  $27 T in value because they not only streamline faster cross border transfer but also help in  bearing yields while holding such tokens .  In the near future, it is expected that if banks fail to generate real-time impact like; 

• Near Instant Settlements 

• Less than $0.1  charges  for every cross border transaction undertaken

• Borderless, Minimal and non existent FX fees 

• Fully digital, smart-contract enabled programmability 

• Cryptographic security

• Fully transparent transaction reporting. 

• Full operationality  24*7 and 365 days in a year. 

They could risk losing the market in cross border remittance until and unless  they innovate to cover the  $250 Trillion remittance target set for  the next 5 years. But for banks to achieve that, they need to overcome the barriers that they face in the present while providing the remittance services for cross border payments; 

What are the Challenges Banks Face To Deliver Next Gen Innovation in cross-border payments? 

1. Transparency

The Remittance Transfer Rule which is predominantly known as US CFPB and India’s LRS  (RTR)  compels banks to provide the following details to the customers like: (i) clear and accurate fee disclosure (ii) data of delivery of funds (iii)  rights to error resolution and disputes (iv) cancellation and refund rights and (v) compliance monitoring for absolute transparency. 

But due to banks using SWIFT systems for transfers, it is very hard to easily track conversion fees or any other hidden charges that an intermediary banking network can impose while the funds are moving from one location to another. This transparency issue has caused a major trouble for banks because out of $17.9 billion in fees paid for remittance, $5.8 B goes into hidden charges. 

And in case, the banks are not able to provide justification for such charges due their transparency hurdles, they can be fined under the Consumer Financial Protection Bureau (CFPB) law under Regulation E in the US. An example for the same is  Bank of America facing a   $21 M in settlements due to their inability to provide complete transparency of charges to customers. 

2. Regulatory Pressure 

Regulatory frictions while sending money through banks becomes another major hurdle while undertaking cross border transfers because of: (i)   different levels of development of the financial market, (ii) lack of a global regulatory perspective, (iii) non collaboration with regulatory bodies  operating from different  jurisdictions and (iv) lack of public-private partnership among the financial players, pushing them into the dark world of fines and penalties. 

As a result, to prevent penalties and other subsequent charges for non-compliance, every year banks are spending  $206 B  annually setting up manual systems for checking AML/ CFT transactions. And there’s no end to this resulting in remitters having to bear the burden of compliance by seeing their  remittance value in cross border transfers diminishing under the cost pressure put on them especially for low value transfers undertaken under travel, payroll, remittance. 

3. High fees 

The global remittance in 2023 was hovering at around $656 B  and it is expected to reach $900 B by 2025. Though the market size of global remittance has increased significantly but not adequate work has been done to minimize the cost of sending the money. For example, the SDG target proposed by G-20 and G-8 nations was to limit the cost of sending foreign remittance via banks using the SWIFT system to 3%, but at this moment, they are nowhere close to their targets. 

As a result of this, remitters are looking for better options in the form of MTOs or Money Transfer Operators, who are not just providing faster single day settlements but even charging way less than their counterparts like banks.

How Can Blockchains Help In Providing Next-Gen Cross-Border Payment Innovation To Banks?

Fortifying  Provenance for Optimum Transparency 

Provenance or trail identification is not possible in a traditional banking infrastructure but blockchain can help trace movements due to its standardization and use of universal distributed ledger systems.  As a result, now it is possible to quickly flag scrupulous  fund movement or track inefficient transactions  moving across borders. 

Santander, a global retail bank operating in Spain, Brazil, Poland and the UK  has partnered with  the  RippleNet Infrastructure to launch One Pay FX, a platform that aims to streamline a smooth and efficient cross border transfer by providing provenance of the fund movement at every checkpoint.  Due to the One Pay FX platform, it is now possible to experience fast transfers, transparency on cost and rates and zero commissions for selective transactions. 

Sandboxing Compliance 

Banks can overcome the regulatory hurdles if they can make cross border payments easily interoperable, strengthen the regulatory collaboration across various stakeholders and build complementary public private partnerships among the financial services involved in streamlining cross border transactions. Blockchains help here because it can allow role based access and eliminate repetitive tasks which significantly inflate the regulatory compliance cost and automate adoption of new regulatory measures in the banking models to eliminate instances of fines and penalties. 

GoldMan Sachs has introduced the GS Digital Asset Platform (DAP)  to help banks fulfill the regulatory requirements.  Using the GS DAP, banks can not just  sandbox compliance but also let different players in the remittance market collaborate and operate with role based control and automate tracking and implementation of new regulations in their modus operandi. As a result, banks are now not  bound to choose between compliance, privacy, and control of permissioned ledger and automation  while operating on a public blockchain for trust and accountability to  optimize operations. 

Mathew McDermott, Managing Director & Global Head of Digital Assets, Goldman Sachs says, “Our goal from the outset has been to help our clients realize the benefits of end-to-end digital lifecycle processing across tokenized assets, digital currencies, and other financial instruments. We are pleased to bring this Daml-based solution to market and continue to find efficiencies that will improve the velocity of transactions.”

Optimizing Cost 

To optimize the cost of remittance, banks need the infrastructure that can help them overcome intermediary bank fees, settlement times, currency exchange fees.  But doing that would demand an infrastructure readily functional  to solve the interop challenges which the SWIFT system isn’t ready for. 

Blockchains provide a considerable advantage using a decentralized ledger network.  For example, Ripple has partnered with more than   300+ banks  allowing them to use its ODL or On-demand Liquidity Solution. Due to this, banks can  instantly  synchronize communication with all the partner networks using a decentralized ledger technology, or Ripple Net which not only passes messages but even moves value. 

Hence  streamlining   debits, credits and liquidity for banks which they couldn’t do using SWIFT previously in a fast and economical way. So far the Ripple Network has significantly cut down the cost and time-to-settlement using its ODL Network for cross-border payments.

It is expected that the global cross border spending will reach $320 T in the next 7 years. Keeping this trend in mind, now banks have more reasons to adopt innovative solutions and embrace the change  or risk being  left behind sticking to legacy rails. Blockchains end up as an amenable solution because they can easily blend with the  new ISO 20022 standards for banking streamlining interoperability and value transfer. 

Because, at this moment, the  ISO 20022 standards can only pass on the message and not the value; thereby still creating a never ending loop of Time-to -Settlement. So, if you want to build anything around the same or want to introduce new use-cases in banking wherein blockchain will have a role to play, Zeeve can help you. 

Pilot Your Banking Use-Cases Around Blockchain With Zeeve

For any of your banking use-cases that you are planning to launch on top of blockchain, compliance will be the most important aspect to avoid business disruption. Zeeve as an ISO 27001, SOC 2 Type II, and GDPR compliant platform makes sure that whatever product that you intend to launch around banking to streamline smooth cross border transactions, we are here to help you in undertaking everything from pilot to implementation to launch. 

With more than 40+ enterprises scattered across regulated and high scale environments, we can provide everything that you are looking for. Schedule a call with us today if you want to integrate blockchain in your existing banking stack for improvisation and better outcomes. 

That trust is eroding. A European Commission study found that 53% of environmental claims examined were vague, misleading or unfounded, while 40% were entirely unsubstantiated. With approximately 230 different environmental labels circulating across EU markets, consumers face a confusing choice where distinguishing genuine sustainability from marketing claims has become nearly impossible.

Meanwhile, consumers are increasingly mindful of what they buy. According to PwC's 2024 Voice of the Consumer Survey, which surveyed over 20,000 consumers across 31 countries, 85% report experiencing the disruptive effects of climate change in their daily lives, and they're willing to pay a 9.7% premium for sustainably produced goods.

But this willingness comes with a demand: verifiable proof.

The gap between consumer demand for verified sustainability and the prevalence of unsubstantiated claims is a trust crisis that threatens the credibility of the entire green economy. Digital Product Passports (DPPs) built on a blockchain technology stack could play a major role in solving this.

Digital Product Passports: Hard-Coding Circularity Into Markets

The European Union has moved decisively to address this trust deficit through the Ecodesign for Sustainable Products Regulation (ESPR), which introduces DPPs for virtually all physical goods placed on the EU market.

A DPP is a structured digital record that contains detailed lifecycle data, material composition, manufacturing origin, carbon footprint, recycling instructions and compliance certifications, accessible via standardized interfaces such as QR codes or NFC tags.

From February 2027, every electric vehicle and industrial battery with a capacity over 2 kWh sold in the EU must include a battery passport accessible via a QR code that contains information on carbon footprint, electrochemical performance, and durability. Textiles, electronics, furniture and construction materials are expected to follow between 2027 and 2030.

The regulation's Brussels Effect means global manufacturers must comply regardless of where they're headquartered. No major company can afford to bypass the European market, as it impacts both exports and imports.

In February 2024, the EU further strengthened its position by revising its blacklist of unfair commercial practices to explicitly prohibit misleading green claims, including generic terms such as "eco-friendly" or "climate neutral" unless backed by recognized certifications. Non-compliant companies face penalties of 4% of annual revenue.

How Blockchain Impacts DPPs

What distinguishes DPPs from previous labeling frameworks is the requirement for tamper-proof, interoperable records that survive product lifecycles spanning decades and multiple ownership transfers. This requirement inherently favors decentralized, immutable infrastructure, which makes blockchain a structural necessity.

The fundamental challenge with sustainability claims is verification. Traditional centralized databases allow retroactive modification: a manufacturer that hosts its own sustainability data can quietly alter records if compliance issues arise in supply chains where entities often compete and may not trust each other.

In such cases, a neutral, shared ledger becomes essential.

Toyota, for example, publicly described its Toyota Blockchain Lab initiatives, which include supply-chain use cases aimed at improving efficiency and traceability by recording and sharing information about parts manufacturing and shipping.

The Aura Blockchain Consortium—founded by LVMH, Prada, Cartier and OTB—announced in September 2024 that it had surpassed 50 million luxury products registered on its blockchain. Louis Vuitton now offers traceability for its LV Diamonds collection, tracking each stone's journey from mine to final setting.

In short, blockchain can address the core issues of traceability and trust through cryptographic immutability. Once product provenance data is recorded, altering it requires computational resources exceeding the combined computational resources of the network securing the chain. A product's manufacturing date, material composition and chain of custody become verifiable facts resistant to manipulation.

Smart contracts, which are self-executing code on blockchains, enable automated verification without human intermediaries. When a product changes hands, smart contracts can automatically verify authenticity against on-chain records, execute warranty transfers and trigger compliance checks based on predetermined criteria.

Creating A Phased DPP Strategy

If you place products on the EU market, you’re the economic operator responsible for ensuring a compliant passport exists at market entry.

The starting point is understanding the regulations and enforceable timelines. The good news is that we're talking mostly about existing data. The task is not building new data from scratch but standardizing and connecting data sets already sitting in your ERP, PLM systems and supplier records.

The logical next step is a gap analysis. Map ESPR-mandated data categories against your current systems. For each data point, determine: Do we have it? Where does it reside? Who owns its accuracy? Some data will come from your bill of materials and bill of processes. Some will require Life Cycle Assessment inputs from upstream suppliers.

Many suppliers will be hesitant to share proprietary information, so businesses need to begin supplier conversations early. Have data-sharing agreements that specify formats, update frequencies and verification protocols. For proprietary data protection, zero-knowledge proofs can be used. Sensitive information can be encrypted so that only authorized parties can access it upon verified request.

Once the data framework is defined, the technology layer becomes clearer. Barcodes, QR codes, RFID tags or NFC chips can make the passport accessible from the physical product. Blockchain’s role begins one layer below. It provides a tamper-evident trust anchor for key lifecycle attestations. You don’t have to replace ERP systems; you can have them publish verifiable updates into a shared integrity layer via middleware and APIs.

This level of integration is complex, so you may want to work with a partner familiar with supply chain complexities and strict regulatory compliance requirements. Either way, you will need a direct thread of data that links a raw material to a finished good. You will also need to ensure that the digital twin is compliant with the ESPR interoperability standards.

Conclusion

For businesses, the question is no longer whether to invest in traceability infrastructure, but how quickly they can build the systems to substantiate their claims. In a marketplace flooded with unsubstantiated green claims, the ability to provide cryptographic proof of sustainability is becoming a regulatory requirement as much as a competitive advantage.

Reimagining BFSI with Blockchain in the 21st Century

The banking, financial and insurance sector has been yearning for an innovation which blockchain has delivered by making way for the following use-cases to change the world in respective segments;

1. In Banking

Decentralized Reserve Currencies

Crisis situations have brought back the narrative that in times of uncertainty, you need a better way to prepare against the odds which might come in many forms from financial turmoils to sanctions or change in diplomatic equations. In such times, you need better ways to circumvent the odds when existing financial systems fail to deliver.

For example, during the Ukraine-Russia war, many Russian oligarch accounts were frozen because of sanctions. As a result, central banks across the globe are looking for an asset class that can bypass uncertainties and provide the perfect case to command control and challenge hegemonic rise.

Though gold is a good option to choose, but Bitcoin(BTC) wins here because whether it is about surviving financial sanctions or withstanding economic crises like bank runs, BTC has always performed better in all these situations as evident from the chart below.

As you can see, despite the SVB Bank Failure, BTC still continued an upward trend not just in 2023 but even at the time of pandemic in 2020 because of its structural engineering . Such records during crises have put the case for BTC to be used as a reserve currency, not just to hedge against inflation, economic risks and more, but also to protect the sovereignty of the country.

At the moment, there are three nations which have vehemently considered BTC as a reserve currency: the US, El Salvador and Czech Republic. The US has passed an executive order under the Trump administration to acquire more than 198,000 BTC, which shall act like a strategic reserve. Likewise, El Salvador and Czech Republic are using BTC to introduce tokenized finance in their economy for modernization and to boost economic inclusion.

Modernizing Foreign Remittance

Remitting payments through banks has ended up as widely expensive for users in 2025. For example, in comparison to MTO or Money Transfer Operators, the banks are charging 12.5%,whereas, MTOs are charging only 5.5%. And banks are compelled to do the same because of an imminent pressure to charge overhead, flat fees, intermediaries, and weak exchange rates. Due to this, banks are losing the battle with the MTO as evident from the chart below.

But blockchains can change the game for banks. For example, Santander, a major multinational Spanish Bank has partnered with Ripple Net. At the moment, after the integration of Ripple to launch One Pay FX, Santander has almost captured the Spain, UK, Brazil, and Poland market capturing 50% of international payments using stablecoins.

So far, not just Santander but other players in banking like Amina and more than 300+ are using Ripple because it has provided low cost, fast settlement and compliant options to banking institutions to challenge the rise of MTOs that are eating up the remittance share of the banking sector.

1. In Financial Services

Tokenizing Assets Under Management

Despite the AUM market reaching $147 trillion by June 2025, if someone says that it is going through a profitability pressure, it would ideally be surprising. But this is undoubtedly true as per Mackinsey report which says that AUM firms, which are using legacy systems, could only meet with periodic reporting, simpler regulatory guidelines (inability to do KYC, AML ) due to technological bottlenecks.

As a result, they are able to recover only 1/3rd of the profits, while the remaining 2/3rd of every revenue dollar has been absorbed by operational expenses to meet various regulatory and other operational challenges as per Mackinsey report.

But the scenario can significantly change upon using digital interfaces, multi-jurisdictional compliance ready infrastructure, richer data management, and enhanced cyber security measures to build trust.

JP Morgan, by using blockchain technology, is on the way to achieve this. So far, JP Morgan, by using blockchain technology, has been able to launch the tokenized money market fund with a $100 M listing initially in a matter of few months and by undertaking optimal investment to launch the same.

John Donohue, Head of Global Liquidity at J.P. Morgan Asset Management said: “Tokenization can fundamentally change the speed and efficiency of transactions, adding new capabilities to traditional products”. He added, “There is a massive amount of interest from clients around tokenization… [and] we have a product lineup that allows them to have the choices that we have in traditional money-market funds on blockchain”. Due to tokenization on blockchain, now these funds can easily enter restricted areas by adhering to all the compliance hurdles using technology as an underlying layer to mitigate the same

So far, not just JP Morgan, but some of its close counterparts, like Franklin Templeton have also used blockchain to enter and penetrate new markets using tokenization through the Benji Token. They are able to attract retail and institutions through this initiative. And presently, its FOBOXX fund has just entered the Asian market by making inroads in the Hong Kong region.

Trade Finance Optimization

Every year global trade is shrinking by a whopping $2.5 T because there’s no availability of technology in place to establish a mature business model to mitigate the challenges involved. For example, imagine trade happening between two parties located in two different locations with different jurisdictional limitations and regulatory challenges, there’s always a default risk involved in such a case.

Why so? Because, it is very hard to establish an enforceable contract to determine the risk sharing. One such incident occurred to demonstrate the same when an Istanbul based producer of textile exported knitted dresses to an importer in Italy, but the freight carrier didn’t adhere to the contract rules and delivered the goods to the importer before the payment.

Upon receiving the consignment, the importer refused to pay up because they claimed that the goods received were not in accordance with the requirements. In the absence of following problems like: (i) proper risk models, (ii) manual processing, (iii) legal misalignment, (iv) fragmented regulations, (v) siloed digital platforms and (vi) poor interoperability, it was very hard to prove who was at fault.

And this is not just a single incident but due to such events, as per reports, out of 80% of trade accomplished annually worldwide, 1% of the trade finance, which equals $2.5T figures remains doubtful . And out of that 1%, there’s a certainty that $50 billion in losses due to such frauds where either of the parties involved defaults due to complex paperwork or regional disparities and inability to enforce accountability.

Blockchains are fixing these problems and so far they have made considerable contributions. For example, Hong Kong-based MTC Electronic Co Limited (MTC) exported shipments of raw materials to its Shenzhen Based Partner by using Voltron, a shared blockchain platform co-founded by 8 member banks.

The process was completed in a matter of a few hours instead of 7 to 10 days with complete accountability. So far, using the Voltron, now called Contour, HSBC has facilitated Trade Finance amounting to $857 B to remain as the top banks using blockchain technology for trade financing and settlements. Other than HSBC, there other players as well like Standard Chartered, DBS, and Citi, MUFG, Crédit Agricole, Lloyds, and ABN Amro which are also a part of the Contour, a financial service initiative using blockchain to speed up payment settlements in a compliant and accountable manner.

1. In Insurance

Strengthening Farm Insurance

Farmers are the most vulnerable section of the society when it comes to availing insurance protection. For example, India, despite being an agriculture driven economy, only 30% of the farmers are insured. And these numbers are so low because of a few reasons (i) high premium of insurance (ii) extended time for claim settlements ( 5 months to 12 months). For example, at the time of writing, more than 5,405 crore of unpaid crop-insurance claims are still pending because of delayed relay of data required to process the same. And this problem is not only present in India alone, but it transcends beyond to other regions like Africa, where the farmers experience the same problems.

But blockchain solutions have provided a way out to not just expedite the claim process but even make the insurance protection affordable for the farmers in the agriculture sector. Lemonade Crypto Coalition, is a subtle example to quote here who are using Area Yield Index mechanism powered by blockchains to make insurance protection affordable and accessible.

In the Area Yield Index, specific territorial regions are marked on top of blockchain to estimate claim premiums and settlement scenarios. Subsequently, a claim is determined and farmers can form parcels to subscribe to the insurance. Upon identification of any unforeseen event or crop failure due to natural calamities, all the farmers are compensated nearly instantly without any failure. So far, under the Lemonade Crypto Climate Coalition, more than 7000 farmers have benefitted when it comes to receiving instant support during crop failures.

Bolstering Fraud Detection

Frauds have ended up as a major problem for the insurance service providers eating up their thin margins of 3% to 5% . For the record, every year the insurance industry in the US loses $308.6 billion or $932.63/ person to fraudulent claims. And this is happening primarily because of the use of AI systems to create fake bills and claim insurance in the process. And these are the sectors who are at the highest risk of frauds

As you can see in the above image, it is very hard for the operations, cyber & speciality lines, life & health sectors to easily identify the frauds in the insurance. But blockchains are making a world of difference. For example, RiskStream has been using blockchain technology to go past the traditional ways to mask and anonymize the data. In its stead, Risk Stream creates active data banks that are accessible by all network participants to detect frauds and prevent claims from happening.

Zeeve for BFSI Implementation

If you are facing any problems in the BFSI segment and you want an innovative way to overcome the issue, Zeeve, as an enterprise grade neutral blockchain platform can help you. We very well understand that compliance is of utmost importance to the BFSI segment and for that matter, we provide an ISO 27001, SOC 2 Type II, and GDPR compliant platform.

Due to this, whatever solution that you intend to implement for the BFSI sector to solve some of its innate problems would remain compliant and operational across different geographical regions. With more than 40+ integration partners, you can easily integrate anything as per your requirements. So, why wait? Our experts are here to help you understand where we can fit into your existing technology stack and modernise the same from the grounds up to meet incoming challenges.

Entry’s Avalanche L1 testnet is now live, and it’s the architectural solution to DeFi’s institutional problem. Built as a compliance-first protocol, Entry embeds regulatory logic into its core, turning legal requirements into programmable, automated, and privacy-preserving functions. Deployed and managed by Zeeve, this is the first live infrastructure where institutions can access DeFi yields and tokenized assets with cryptographic certainty and full regulatory alignment.

Entry’s Programmable Compliance is the Engine for Institutional DeFi

Entry redesigns the entire stack from scratch and makes compliance an asset. It introduces a protocol-agnostic compliance layer that bridges decentralized ecosystems with institutional needs through two core innovations:

• Zero-Knowledge Identity (zkID): This is the key to solve the privacy paradox. zkID allows institutions and users to prove their credentials like, KYC, jurisdiction, etc. without revealing any underlying personal data. It’s verifiable compliance without surveillance, and satisfy both regulators and users.

• The Regulation LLM: Entry use Zekret Labs’s AI-powered compliance engine acts as an interpretive layer trained on global frameworks like MiCA and FATF. It automates asset screening, transaction monitoring, and provides “explainable compliance,” ensuring every action is auditable and understandable to regulators.

Entry brings a new operating system for regulated finance, designed to cut compliance overhead by up to 60% and accelerate the launch of compliant tokenized assets.

“For too long, DeFi and TradFi have spoken different languages. Entry is the universal translator. We’re architecting a new financial operating system where privacy and compliance are native features. Our Avalanche L1 is the proving ground for this new era.”

— Rodney Prescott, CEO of Entry

Why a Sovereign Avalanche L1 is Non-Negotiable?

To build an infrastructure capable of handling institutional-grade finance, a shared, generic blockchain is a non-starter. The environment must be controlled, performant, and purpose-built. Entry’s choice of a sovereign Avalanche L1 was a strategic necessity.

This architecture provides:

• A Dedicated Economic Zone: Entry operates its own sovereign network, with full control over its validator set, gas fees (paid in its native token), and on-chain governance. This allows them to embed compliance rules at the consensus level.

• Capital Markets Speed: With sub-second finality, transactions are settled instantly. This raw throughput is essential for the high-frequency nature of financial markets and eliminates the risk of network congestion impacting critical operations.

• EVM-Native Interoperability: By remaining EVM-compatible, Entry ensures that trillions of dollars in existing assets and thousands of developers can seamlessly integrate with its compliance infrastructure.

Zeeve Provided that Utility-Grade Infrastructure for a Trillion-Dollar Chain

When the stakes are this high, infrastructure cannot be a variable—it must be a utility. Entry required a partner capable of deploying and managing a zero-failure network. Zeeve provided the enterprise-grade foundation for Entry’s Avalanche L1.

Zeeve’s role ensures institutional-grade reliability:

• End-to-End L1 Deployment: Zeeve managed the entire deployment and optimization of the Avalanche L1 stack, tailored for mission-critical financial operations.

• Hardened Security & Monitoring: The network is under 24/7 automated monitoring with enterprise-grade SLAs, providing the resilience and uptime demanded by financial institutions.

• Transparent Auditing: With dedicated RPC endpoints and the integrated TraceHawk block explorer, Zeeve provides the deep on-chain visibility and transparency required for regulatory audits and partner due diligence.

An infrastructure designed to secure trillions in institutional assets cannot run on ‘good enough.’ It demands absolute reliability. We engineered every component of Entry’s L1 for the data integrity, security, and uptime needed to power a new financial paradigm. This is the mission-critical infrastructure Zeeve was built to deliver

— Dr. Ravi Chamria, Co-founder & CEO, Zeeve

Entry testnet launch is a signal that the firewall between TradFi and DeFi is finally being dismantled. It provides the blueprint for a new generation of vertical-specific chains that solve real-world industry problems at scale. The future of every major industry will be built on its own sovereign, purpose-built blockchain.

If you’re ready to build yours, you need an infrastructure partner who has already done it.

The project has seen solid traction. The team has raised over 96M and was backed by major VCs like Paradigm, Polychain, Galaxy, Hack VC, Hashkey, and IOSG. They saw incredible demand, with nearly $7 billion in Bitcoin already staked on the protocol. Nearly 19% of floating $BABY supply is also staked.

This guide is designed to help you seize that opportunity. We’ll show you how to stake and delegate your $BABY tokens with Zeeve’s enterprise-grade validator and become a part of Babylon’s success story.

Let’s get started.

If you want a refresher on Babylon and $BABY token, read it here:

https://www.zeeve.io/blog/babylon-staking-explained-earn-baby-staking-rewards-with-zeeve-validator/

Why Stake $BABY with the Zeeve-run Babylon Validator?

Choosing a reliable validator is the most important decision you’ll make as a delegator. Zeeve is an active, institutional-grade validator node infrastructure provider with a proven track record of deploying over 6000+ nodes across 40+ protocols.

Here are some more reasons why delegators choose Zeeve:

• Lowest Commission, Higher Rewards: Zeeve charges only a 3% commission, one of the lowest among active validators. This means a larger share of the staking rewards goes directly to you.

• 99.95% Proven Uptime: Our enterprise-grade infrastructure, backed by strict SLAs, has multi-cloud, multi-region deployments with auto-failover to ensure consistent rewards and minimize any risk of missed blocks.

• Audited Security and Compliance: As a SOC 2 Type II and ISO 27001 certified provider, our infrastructure meets the highest global standards for security and data protection.

• Fully Non-Custodial: The asset owner always maintains full control and custody of their assets. Zeeve never accesses your private keys.

Before You Begin, Here are Some Prerequisites

Before you start the delegation process, let’s make sure you have everything needed for a successful BABY delegation.

1. Install Keplr Wallet: As the premier wallet for the Cosmos ecosystem, Keplr is our tool of choice. If you haven’t already, install the Keplr browser extension/ mobile app and create your wallet.

2. Buy $BABY Tokens: You’ll need some $BABY tokens in your Keplr wallet. If you’re doing it for the 1st time, the next section covers how you can do it.

3. Keep Gas Fee: Please keep a tiny fraction of $BABY (e.g., 0.01 BABY) in your wallet. This will cover the small network fees required to process transactions.

How to Buy $BABY Tokens?

If you don’t have $BABY tokens yet, you can get it through a Centralized Exchange (CEX) or a Decentralized Exchange (DEX).

Using a Centralized Exchange like Binance, BYBIT, OKX, or Kraken:

1. Create and Verify Your Account: Sign up on an exchange like Binance, Bybit, Gate, OKX, Kraken, and complete the necessary verification steps.

2. Deposit Funds: Fund your account using fiat currency or by transferring another crypto.

3. Purchase $BABY: Navigate to the spot market, search for the BABY trading pair (e.g., BABY/USDT, BABY/USDC, or BABY/USD), and place your buy order.

4. Withdraw to Keplr: Once purchased, go to your wallet on the exchange, select “Withdraw,” choose BABY, and transfer the tokens to your Babylon wallet address from Keplr.

Using a Decentralized Exchange like Osmosis:

• Navigate to Osmosis: Go to the https://app.osmosis.zone/

• Connect Your Keplr Wallet: Connect the Keplr wallet that holds the assets you want to swap or you have USDC/USDT to buy.

• Buy Tokens: Select USDC/USDT, whichever you hold, and enter the amount to see how many BABY you will receive and the fees for the transaction.

• Swap Tokens: Click on the Swap icon if you hold other assets, for example, BTC, and want to swap with BABY at very minimal fees.

• Approve the Transaction: Enter the amount, execute the swap or buy transaction, and approve the transaction in your Keplr wallet.

• Ready to Use: Once the process is complete, the total number of BABY available should be visible in your wallet. Now it can be staked.

Delegating Your $BABY with Zeeve: A Simple, Secure Process

Now let’s get into the main task. Zeeve has designed the delegation flow to be as seamless as possible. Here’s how you can put your tokens to work in just a few clicks and in just a matter of minutes.

Step 1: Begin at the Zeeve Staking Portal: Your journey starts on the Zeeve delegation page. Once there, you’ll see a prominent “Stake Now” button. Go ahead and click it.

Step 2: Choose Babylon: Once you have clicked on ‘Stake Now’, you’ll be presented with a list of top-tier PoS networks where Zeeve is currently accepting delegation.

Find the Babylon logo and click “Stake Now” to continue. This link provides direct access to our validator interface.

Step 3: Connect and Review: Your Keplr wallet will now ask for permission to connect. Once you approve it, a dashboard will appear showing the vital stats for Zeeve’s validator.

You’ll see our highly competitive 3% commission rate and the current 19.22% Annual Percentage Return (APR) for BABY staking and unbonding period, which is around 50H.

Take a moment to review, then click “Stake.”

Step 4: Specify Your Delegation Amount: A new field will appear where you can enter the amount of $BABY you wish to delegate to Zeeve-run Babylon validator node. Type in your desired amount and click the “Stake” button.

Here, we would be entering 100 tokens for this tutorial and then just click on ‘Stake’.

Step 5: Give Your Final Approval: Keplr will pop up one last time to show you a summary of the transaction. Give it a final check and click “Approve.”

You will see, the transaction will be processed and successfully executed as well instantly. Your delegation is now on its way to the Babylon network.

Step 6: Confirmation: Now we can head over to the Explorer. There, after refreshing it, you can see that our wrap delegation is already executed. But you won’t be able to see this delegation onto the validator itself right then, since it only occurs or only comes in after an epoch has passed through. And one epoch usually takes around one hour. So after an hour max, you will be able to see your delegation on the Zeeve’s validator node.

And that’s it! You’ve successfully delegated your $BABY. Your stake will become active and start earning rewards once the current network epoch concludes.

Ready to stake?

Use the “Stake Now” button from our delegation page, select the protocol, connect Keplr, enter the amount, and approve—done.

https://www.zeeve.io/delegation-service/

FAQs:

• Is staking with Zeeve non-custodial?

Yes. You retain full control of your assets and keys at all times. Delegation is done directly from your personal Keplr wallet.

• What is the unbonding period for $BABY tokens?

The unbonding period is approximately ~50 Hours / 2 days (around 300 Bitcoin blocks). During this time, your tokens are locked before they become liquid again.

• Is there a minimum staking amount with Zeeve?

No. While running your own validator requires a significant stake, there is no minimum amount required to delegate your $BABY tokens to Zeeve.

• How are my staking rewards calculated?

Rewards are calculated based on the Babylon protocol’s inflation rate and validator’s performance (uptime) and commission. Zeeve’s high uptime and low 3% commission are designed to maximize your share of the rewards. The current APR is approximately 19.22%.

• How often can I claim my rewards?

Rewards accrue with every block. You can claim them at any time through the Keplr dashboard, though it’s often more gas-efficient to let them accumulate before claiming.

• Can I compound rewards?

Yes. Claim then delegate again. Remember to leave a fraction for fees.

• What are the risks of staking?

All PoS networks have a slashing risk, where a validator can be penalized for significant downtime or malicious actions. Zeeve mitigates this risk with a robust, redundant infrastructure and 24/7 monitoring by SRE experts.

Due to this, institutions are now looking for alternatives to maximize their yields.  In this regard, crypto staking has ended up as an amenable option because almost all major protocols have surpassed what traditional investment vehicles are generating at the moment.

But crypto staking is not as simple as you might be thinking because you have to run nodes to validate the chain to gain returns. For that matter, you need an infrastructure supporting your pursuit. In this blog, we shall deep dive into understanding Staking-as-a-Service, how it works, and why it is trending in 2025. So, without any further ado, let’s get started.

What is Staking-as-a-Service (StaaS)?

Staking-as-a-Service allows crypto holders to delegate tokens to professional node operators without running the whole infrastructure themselves. In traditional staking, an individual locks up their holding to participate in network validation.

This helps the blockchain in maintaining its network security. In return, the holders are given staking rewards. However, to participate in the validation process, holders must set up infrastructure that enables them to run validator nodes. This process can be challenging for many individuals, and the setup costs are also high. This is where StaaS comes to the rescue.

In the StaaS model, a service provider handles all the technical and hardware requirements on your behalf. This includes the complex validator setup and the required maintenance activities. You simply lock your tokens through a web interface or API, and the StaaS provider stakes them into the network. In return, you earn a share of the block rewards, just as if you ran your own validator. That being said, let’s understand how this process works.

How Staking-as-a-Service Works?

Select a StaaS provider: The process begins by choosing a trusted StaaS provider that has the necessary infrastructure to handle the complex requirements.

Delegate tokens: Next, you delegate the desired amount of your tokens to the provider by connecting your wallet. Importantly, the custody of your keys lies with you. This is because the service only requires a validator key and not a withdrawal authority.

Validation: The provider then runs enterprise-level nodes to participate in the network validation of the blockchain. A great Staking-as-a-Service provider constantly monitors the performance of the infrastructure and manages upgrades in real time. They make sure that the node remains online to prevent downtime and any slashing penalties.

Earn rewards: As the blockchain generates new blocks, your delegated stake earns a pro rata share of the block rewards or transaction fees. The StaaS provider keeps back a percentage of the rewards as commission, and you get the majority in your account. These rewards accumulate in your staking account and can be seen in real-time on a dashboard.

Compound staking growth: Once you have received the staking rewards, you can either claim them or they will be automatically re-staked to generate additional returns for you. This way, you will also enjoy the rewards of compounding without putting any effort into it.

The StaaS process is where the real value is. It involves a bunch of complex steps, but a great provider has them automatically streamlined to make the whole experience smooth. The core advantage of StaaS is that your participation in the process is minimal without losing control over your funds.

Why  Staking-as-a-Service Could Be A Bridge Between DeFi and Institutions?

So, why is Staas ending up as a bridge between institutions and DEFi?   A few reasons driving the shift;

1.Institutional Participation

Several traditional finance players are actively participating in crypto staking. Even major institutions and banks now support PoS staking. For instance, Anchorage Digital, a federally chartered bank in the United States, now offers staking services for institutions.

Additionally, Switzerland’s SEBA Bank provides crypto custody and lending services to its clients globally. Moreover, Coinbase Custody also offers fully secure and compliant staking services.

Several asset managers are also catching up. Canadian fund 3iQ launched a Solana Staking ETF (SOLQ) on the Toronto Stock Exchange in 2025, highlighting demand for staking-backed yield in a regulated space.

This institutional momentum suggests that PoS rewards can be a valuable addition to modern investment strategies. One key reason for this increased interest is the current US Government’s positive stance towards crypto. Multiple ETF approvals, the GENIUS Act, and the recent SEC staff statement regarding staking activities are key examples.

Moreover, staking’s additional and predictable returns are becoming an attractive venture for institutions. As a result,  fund managers are taking staking as a gateway to diversify portfolios, making it a hot favorite in 2025 for institutions and DeFi bridging. In this pursuit, Staking-as-a-Service has ended up as an amenable solution because it abstracts all the complexities to set up your node and participate for benefits.

2. Staking Yields vs Traditional Finance

An important reason why staking-as-a-Service is attracting more investors is the high yields compared to traditional finance players. For instance, the US 5 Year Note Bond Yield is about 3.68% currently. This fails to beat inflation. Moreover, savings bank interest also hovers around 4-5% annually.

As evident from the graph above, in the last 10 years, the yield that crypto has generated has outsmarted traditional financial instruments like bonds and savings at around 7% and rising, pushing the narrative of staking yield to occupy center stage. With Staking-as-a-Service, institutions are getting the gateway to explore the hidden yields of DeFi in a low-yield traditional bond-bearing environment.

3. Complexity & Compliance

Running validators in-house is challenging, which keeps institutions away from staking. For example, if institutions want to integrate the same, they have to build everything from the ground up, like secure key management, a 24/7 validation system, monitor slashing risk, and meet regulatory KYC/AML audits. Moreover, institutions deal with huge amounts of capital, which increases the stakes and the seriousness regarding the risk of theft.

To outsource these complex yet important tasks, institutions choose StaaS providers. The latter helps them with the infrastructure to minimize technical and regulatory headaches. In addition to this, Staking-as-a-Service also helps in diversifying the use cases of DeFi, where, for the first time, institutions can tap unexplored goldmines like native staking, delegated staking, liquidity staking, and liquidity pool participations, which are advanced use cases attracting major institutions.

That’s why institutions are finding Staas as an effective gateway to explore the profitable realms of DeFi. But when they are doing the same, there are a few things that they should consider firsthand to explore them.

Top Determinants While Choosing a Staking-as-a-Service Provider

Before you make a move to choose a Staking-as-a-Service provider for your staking pursuits, there are  a few things that you should look into;

Custody Model: This is a very important factor. The custody of the key should remain with you so that you retain control. Look for a non-custodial StaaS provider that never takes possession of your tokens. This model ensures safety for your funds. For instance, if the infrastructure of the provider is compromised, your funds will remain safe if in your custody.

Security: While selecting a StaaS provider, you must make sure that they use enterprise-grade security measures. Check for industry certifications like SOC 2 Type II, ISO 27001, etc., and strong operational controls. For instance, you should look for platforms that provide 24/7 security monitoring and tools to manage your nodes. There are several privacy and compliance measures in place, too. In short, your provider should have rigorously audited multi-layer security and provide transparency.

Reliability & Uptime: Validator downtime results in lost rewards and potential slashing. Look for StaaS providers that guarantee 24/7 availability. Top providers deploy nodes across multiple cloud regions with automated failover. This, along with other factors, helps in maintaining a high uptime of 99.5%.

Fees: Then, you must be clear about the commission or fees charged by the StaaS provider. The core reason for staking is to earn returns on your funds. So, a transparent fee structure helps you in deciding whether you should go with a certain provider. Ideally, choose a provider with low commission to maximize your gains.

Support and Reputation: For large delegations, 24/7 support and a solid track record are particularly important. Research the provider’s reputation. Have they run validators for other projects or clients? Do they publicly share their uptime statistics or undergo regular audits? Community feedback can also give insight into the responsiveness and reliability of a provider.

By carefully looking for these factors while choosing a StaaS provider, investors can select a partner that understands their risk profile and supports their needs.

Delegate Your Tokens with Zeeve Staking–as-a-Service

Zeeve’s platform provides a well-engineered Staking-as-a-Service for investors. Here are some key features:

Non-custodial by design: Zeeve never asks for users’ tokens. Investors delegate their tokens from their wallet and maintain complete control of their funds. Zeeve only receives a validator key, not the private key to withdraw funds. You can check Coreum and Babylon.

1-Click Delegation: Just pick a network, choose Zeeve validator, and confirm. That is all you have to do to start earning your staking rewards.

Enterprise-grade infrastructure: Zeeve operates validators with institutional-grade reliability. The stack is SOC2 and ISO-27001 certified, with multi-layered deployment to maintain a 99.5% uptime guarantee.

Low commission: Zeeve charges a commission of 3%, which is the lowest among active validators. So, you retain more rewards to earn high long-term yields.

Transparent systems: Zeeve provides real-time analytics for investors to track important metrics like validator health, commission history, rewards, missed blocks, etc.

24/7 Support: You get constant support and continuous monitoring. For large or institutional delegations, Zeeve offers dedicated support, runbooks, and priority incident channels.

Automatic protocol support: Zeeve is already an active validator on multiple PoS chains. For example, Zeeve runs a Babylon ($BABY) validator on the Cosmos network and a Coreum validator on its BPoS network.

As you can see, Zeeve fulfills all the requirements of a great Staking-as-a-Service provider. It focuses on maintaining a safe, transparent, and reliable platform for investors.

For a sector that touches billions of lives daily, the lack of evolution in user engagement, monetization, and financial inclusion is stark. Even in Web3, where decentralization is meant to shatter barriers, telecom remains largely out of sync. Attempts to bring blockchain into telco apps often stop at SIM-linked wallets, token-based recharge offers, etc.

That’s where The Binary Holdings (TBH) enters. Their approach isn’t about layering crypto on top of telecom. They rebuilt the infrastructure stack that is the centrepoint of  user engagement within telco apps, the loyalty point program.

And now, they’re moving that Web3 Telecom infrastructure on Avalanche L1 using Cogitus by Zeeve.

With a user base of 169 million from Southeast Asia, Binary is leading the push to make Web3 Telecom a scalable, meaningful category.

But this isn’t just a telecom story. It’s a story of mass adoption also. A model that proves Web3 isn’t just for crypto-native builders, but for mobile-native billions. If you’re building Web3 telecom infrastructure that actually wants to scale, this chain might be your new reference design.

The Real Problem with Telecom Infrastructure in Web2 — and Web3

Let’s get honest about the issues first.

In Web2, telecom apps are static and transactional. The UX is stale. Engagement is minimal. There’s zero incentive to open the app unless you have to. For telcos, that means missed revenue, limited retention, and no real customer ecosystem.

In Web3, the problems are the opposite. The innovation is wild, but the friction is higher. Wallets, bridges, gas, private keys — it’s not just unfamiliar, it’s intimidating. And while Web3 devs build some of the most creative experiences in tech, most of their apps struggle to reach mainstream users because the distribution model is broken. If you don’t already use crypto, you’re locked out.

Now, stack the two problems together, and it’s clear why a bridge was needed. Not a metaphorical one — a real, integrated layer where user intent meets digital opportunity, without switching platforms or changing behavior.

The Binary Holdings (TBH) saw that gap, and they filled it with Web3 Telecom Infrastructure on Avalanche L1, and seamlessly connected telecom users to blockchain ecosystems.

“Telecom is an unconventional yet critical category that Web3 can cater to — and Binary has set the precedent. Their Avalanche L1 is a blueprint for enterprise-grade distribution, monetization, and on-chain service delivery at mobile scale. We’re excited to work with them again in bringing this new chain to life,”

Dr. Ravi Chamria, Co-founder and CEO of Zeeve.

How The Binary Holdings Is Bringing Web3 in the Phones of 169M+ Telecom Users?

Binary Holdings is building The Binary Network: a full-scale, production-ready blockchain designed to become the Web3 distribution layer for global telecom providers.

But what sets them apart is not just the technology. It’s their model.

Instead of asking users to download wallets, bridge funds, or understand tokenomics, Binary meets them where they already are—inside their telcom apps.

Imagine this: Your mobile carrier app has a playstore like interface. When you open it to check your data plan, instead of just a dashboard and a payment button, you see tokenized asset investments, loyalty NFTs, or even on-chain mini-games, with all activity rewarded in $BNRY tokens that can be redeemed for data or airtime.

This seamless experience is powered by Web3 Telecom Infrastructure on Avalanche L1, and enables blockchain integration within everyday telecom apps.

Binary’s telco partners—spread across Southeast Asia (namely Indonesia and Phillipines) for now and covering over 169 million users—are embedding The Binary Network into their existing infrastructure. That means Web3 isn’t a separate experience. It’s native.

Users can invest in real estate through fractional tokenization. Access DeFi tools for earning yield. Participate in DAO votes for app-level decisions. Or simply earn $BNRY by using telco services they were already going to use anyway.

And because it’s all backed by an Avalanche Layer1, the platform doesn’t rely on external bridges or centralized gateways. It’s composable, interoperable, secure by design, and showcases the power of Web3 Telecom Infrastructure on Avalanche L1 to drive mass adoption.

Why is Avalanche L1 the right move for Web3 Telecom Infrastructure?

Binary Holdings began its journey on the OP Stack—leveraging Ethereum’s scalability frameworks to launch a powerful Layer 2 experience. And to their credit, it worked.

Binary’s success with OP Stack proved product-market fit. But as their ecosystem evolved, so did the requirements. To scale further, they needed more — more control, more scalability, more sovereignty, greater customization. And an environment where appchains could be tuned for telecom-grade performance across diverse user bases and regulatory zones.

This shift necessitated Web3 Telecom Infrastructure on Avalanche L1 to meet web2-scale demands with unparalleled flexibility. The Avalanche L1 architecture offers The Binary Holdings what most modular chains can’t: customizable virtual machines, sub-second finality, native multichain support, and near-infinite scalability for high-volume consumer interactions.

In other words, the kind of infra muscle you need when your target audience is not 1M crypto users, but 1B mobile subscribers.

More importantly, Avalanche gave Binary the design space to turn their vision into a telecom-native chain, not just a Web3-native one. Their Avalanche L1 now has complete flexibility to support tokenized asset marketplaces, advanced loyalty mechanics, dApp distribution channels, staking programs, and future pathways to launch subnets for region-specific regulatory compliance.

With this shift to Avalanche L1, The Binary Holdings didn’t just upgrade their stack. They upgraded their ambition to build a Web3 Telecom Infrastructure on Avalanche L1 chain that’s not only tailor-made but also future-proof.

Why They Chose Zeeve for the Transition

“Zeeve has been with us since our OP Stack days — but with Avalanche L1, the ambition and complexity scaled up gradually. Their Cogitus platform allowed us to rapidly migrate from old infrastructure to Avalanche L1, with the performance guardrails and security guarentees we needed for telecom. Our partnership has co-engineered the backbone for everything TBH is building in Web3 Telecom Infrastructure today,”

Manit Parikh, CEO of The Binary Holdings.

This wasn’t Binary’s first deployment. Their OP Stack Layer 2 was also supported by Zeeve Rollups-as-a-Service, and when it came time to build their Avalanche L1, they didn’t look elsewhere because they didn’t need to.

Zeeve has already proven itself in navigating the complexities of launching, monitoring, and upgrading Web3 infrastructure in production. But Avalanche is a different beast. L1s require deeper orchestration, validator bootstrapping, customized consensus configurations, and region-specific compliance guardrails.

When the Avalanche shift was planned, Zeeve stepped in with its Cogitus platform, a dedicated Avalanche L1 launcher, delivering end-to-end infrastructure for their new L1 chain with zero friction. From testnet to mainnet, Cogitus provided the full Avalanche L1 lifecycle support, including:

• Chain deployment with tailored virtual machine configurations

• CI/CD pipelines for regular updates without downtime

• TraceHawk block explorer for fast, reliable insights into transactions, block data, and L1 network activity.

• Developer dashboards and analytics for app partners

• Security infrastructure aligned with ISO27001 and SOC2 standards

• Integrated explorers, faucets, and RPC endpoints for each environment

Infrastructure migrations are never easy, especially when they touch millions of users, telecom-grade SLAs, and mission-critical systems. The Binary Holdings needed a partner who could not only handle the technical lift but also understand the nuances of web3 Telecom infrastructure on Avalanche L1 stack.

Validator provisioning, full-node orchestration, VM configuration, staking support, custom APIs, and performance monitoring are all handled under Zeeve’s enterprise-grade SLA. More than just deployment, Cogitus powered by Zeeve provided The Binary Holdings with a foundation to build new business models.

More than just an infra upgrade, it was a business-critical transformation enabled by the right stack and the right partner.

There’s a lesson here—and it’s bigger than telecom.

We’ve spent a decade building tools for web3 natives. But the next billion users? They’re not coming from Discord. They’re coming from telco apps, mobile banking platforms, social commerce wallets, and offline communities that never opted into Web3—but are ready to benefit from it.

The Binary Holdings is rebuilding the market’s rails from the inside. And they’re doing it in a way that aligns with how people already interact with value. Their Avalanche L1 is a service chain. Designed to carry dApps, incentives, and assets to a mobile-first world. Web3 Telecom Infrastructure on Avalanche L1 is how that delivery system comes to life.

If you’re building anything remotely tied to real-world usage—whether that’s RWA tokenization, Web3 user acquisition, or cross-border transactions—you need to think about where the distribution is. And increasingly, it’s going to be chains like TBH’s that hold the keys.

And if you’re planning to launch your own Avalanche L1? You need infra partners who’ve been through this before. Who understands both frameworks, like OP Stack and Avalanche L1s. Who knows how to go from concept to scale without leaving holes in security, compliance, or observability.

Zeeve is that partner. Talk to us. Let’s build your Avalanche L1 next!

Now, 2025 is set to add another major sector to that list: mobility and vehicle finance. Toyota has already brought global attention to Avalanche by prototyping its Mobility Orchestration Network (MON) on the stack, showing how vehicles can be transformed into verifiable, finance-ready assets. At the same time, companies like CodeNekt, a Zeeve client, are using Avalanche L1s to tackle generational problems in vehicle data management, from fraud and traceability to compliance and fleet optimization.

What this signal is, Avalanche has the architectural mobility needs. In this blog, we’ll break down why legacy systems fail to support next-gen mobility and how Avalanche’s multi-L1 design is solving those structural gaps.

Limitations of Legacy Systems in Solving Next-Gen Mobility Barriers of Automotive Sector

The automotive industry is riddled with data silos and fragmented compliance rules. A single vehicle may pass through six or more hands (OEMs, fleet operators, insurers, regulators, drivers, service centers, and more maybe).  Yet the digital record that underpins its value remains fragmented, unverifiable, and non-portable

And unless mobility assets can become verifiable, finance-ready Real-World assets, the sector cannot scale into electrification, autonomy, or sustainable fleet operations. There are three major gaps that prevent mobility from becoming a trusted and liquid asset class:

First, the Organizational Gap. Vehicle registration, insurance, taxation, VIN and OEM data, and maintenance logs are all stored in isolated government or corporate databases. There is no Mobility Oriented Account (MOA) that bundles these institutional, technical, and economic claims into a tamper-evident identity. This leaves second-hand markets rife with odometer fraud, hidden liabilities, and scams, while manufacturers face massive recall costs because data trails vanish after the first ownership cycle.

Second, the Industrial Gap. Mobility is not one industry; it’s a mesh of capital networks (banks, securitization platforms), utility networks (ride-hailing, V2G, charging), and trust networks (registration, compliance). Yet there is no neutral digital layer to let them transact atomically. Fleet operators cannot refinance assets based on live operational data. Insurers misprice policies because they lack standardized, machine-verifiable safety and usage proofs. The absence of a multi-chain orchestration layer keeps mobility’s value locked.

Third, the National Gap. Vehicles are inherently cross-border, but compliance is regional. Registration certificates valid in one country lose legitimacy in another. Taxation and insurance proofs are regional. Used-car exports into developing markets often bypass safety and environmental checks, flooding roads with high emissions. Without a protocol for local-first, global-next compliance, mobility remains trapped in jurisdictional silos.

These issues create friction everywhere—from customers doubting vehicle history, to fleet operators struggling with refinancing, to OEMs navigating a maze of regulations when selling in new regions.

The answer isn’t just digitization. It’s a new trust layer that bundles institutional, technical, and economic proofs into a single, verifiable identity for every vehicle. And that’s where Avalanche L1s could shine.

How Avalanche L1s Ends Up as The Perfect Solution  For The Automobile Industry?

Avalanche L1s are making a difference because they provide the purpose-built stack to address the challenges mentioned above by providing:

Data Access and Control Layer For Privacy

With the public blockchains, you cannot integrate permissioned access. Which means anyone can see the transaction happening on the blockchain. This could be detrimental to using blockchains because your competitor can see the business secrets. But this is a double-edged sword, because if you do not launch on a public blockchain, instead, launch a consortium chain, even then, your problem will still remain because not every player will be using the same stack as you. In that case, you still face the problem of data silos.

That’s where Avalanche L1s are providing data access and control layers that car manufacturers can use to interact with their peers and share only whatever is necessary for the smooth operation of the business, irrespective of the stack they use.

To do that, Avalanche L1s allow setting up administrator nodes with full control over the stack, thereby ensuring role-based access for regulators and competitors who are willing to collaborate but don’t have the means to do that without jeopardizing operations due to privacy constraints. And its bridges can also help interact with different chains irrespective of the stack they use.

Native Interop through Multi-L1 Architecture

Interoperability is a challenge when there are various players in the industry using different stacks for operation. Avalanche L1s are using multichain support through Interop using Avalanche Warp Messaging and Teleporter to allow communication, especially in the Delivery-versus-Payment (DvP) transactions. Because you need instant interoperability irrespective of the stack that two different applications are using when interacting with each other, this is highly suited for use cases such as BEVs, monetizing energy storage, logistics efficiency, and green transition.

Toyota’s MON 4-L1 prototype architecture below illustrates how Avalanche L1s can be configured for mobility with dedicated L1s for trust, finance, utility, and stablecoin payments, all connected through Avalanche Interchain Messaging (ICM). This modular design makes Delivery-vs-Payment and cross-network coordination possible in a way legacy infrastructure never could.

Cross-Border Compatibility Via Custom VMs:

Compliance is another major battle that the automotive sector is wishful of winning, but they do not get the means to help achieve that when they are operating in different jurisdictions. With the help of Avalanche L1 chains, automobile companies can create built-in KYC/AML checks, specifically targeting financiers and insurers.

At the same time, it is also possible to create an administrator dashboard using the Avalanche L1 stack and give role-based access to regulators to access important information and when needed. At the same time, preserving privacy in the process through eERC-20 features that Avalanche L1s are using.

Building The Fungibility Ladder

Making vehicles fungible is a major bottleneck for fleet owners because they cannot set up standards where they can self-identify the vehicles and make them readily available for financing in cross border operations. Avalanche L1s provide a fungibility ladder for these fleet owners dispersed across different jurisdictions through a standardized access to overcome this. Using Avalanche L1s, the automobile players can spin up their own chains and set up specific traits for their NFTs that can be easily exchanged overseas/cross border in a near instant, scalable  cost-effective and compliant manner, eliminating the friction to manage cross border fleet management that automobile players are going through at the moment.

Optimizing Cost For Faster Deployment

This is the most important aspect to consider when launching a blockchain-based automotive business, as you do not want to overburden yourself with unnecessary technology. Avalanche L1s are purpose-built because there’s no compulsion to stake like 2000 AVAX to run your validators for your chain.

With that being said, you are getting a stable infrastructure cost to launch your automotive application on top of Avalanche L1s, and despite their rigorous increase in usage, the cost wouldn’t be inflating in the near future because the L1s have Pay-As-you-Go, custom gas tokens, and other specs to keep the operations optimized from a cost standpoint.

At the same time, the consensus mechanism of Avalanche L1s is purpose-built as well to accommodate a scaling automotive sector with transactions matching almost 4500 TPS due to the random sub-sampling consensus mechanism. Martin Eckardt, Senior Director of DevRel at Ava Labs, specifically emphasizes the role Avalanche L1s are playing in keeping the cost low for efficient operations despite the automotive business scaling in a podcast between Zeeve’s CEO, Dr Ravi Chamria, and Francis Hanchem, founder of CodeNekt:

Future Proofing Mobility

Avalanche L1s have an advantage when it comes to future-proofing the mobility sector because they have the capability to bridge finance, mobility, and IoTs under a common stack, which no other stack has delivered so far. Due to this trait only, the Togg ecosystem in Turkey has partnered with Avalanche to take mobility to the next level.

If you are someone in the automotive industry facing the problems mentioned in this blog, Avalanche L1s can rightfully address them.

But if you are bothered that all of these would amount to spending hours to integrate the same, Zeeve can help you in this regard to launch your Avalanche L1 for the Automotive Industry.

Avalanche L1

Is Avalanche L1 About to Become the Hotspot for Vehicle Finance & Mobility?

Dr. Ravi Chamria

• September 1, 2025

Avalanche L1s are making headlines due to the value they have captured in the last few months by providing a custom stack. Due to this, gaming,  stablecoins, DeFi, NFTs, manufacturing, and even government sectors are getting revolutionized by it.

Now, 2025 is set to add another major sector to that list: mobility and vehicle finance. Toyota has already brought global attention to Avalanche by prototyping its Mobility Orchestration Network (MON) on the stack, showing how vehicles can be transformed into verifiable, finance-ready assets. At the same time, companies like CodeNekt, a Zeeve client, are using Avalanche L1s to tackle generational problems in vehicle data management, from fraud and traceability to compliance and fleet optimization.

What this signal is, Avalanche has the architectural mobility needs. In this blog, we’ll break down why legacy systems fail to support next-gen mobility and how Avalanche’s multi-L1 design is solving those structural gaps.

Limitations of Legacy Systems in Solving Next-Gen Mobility Barriers of Automotive Sector

The automotive industry is riddled with data silos and fragmented compliance rules. A single vehicle may pass through six or more hands (OEMs, fleet operators, insurers, regulators, drivers, service centers, and more maybe).  Yet the digital record that underpins its value remains fragmented, unverifiable, and non-portable

And unless mobility assets can become verifiable, finance-ready Real-World assets, the sector cannot scale into electrification, autonomy, or sustainable fleet operations. There are three major gaps that prevent mobility from becoming a trusted and liquid asset class:

First, the Organizational Gap. Vehicle registration, insurance, taxation, VIN and OEM data, and maintenance logs are all stored in isolated government or corporate databases. There is no Mobility Oriented Account (MOA) that bundles these institutional, technical, and economic claims into a tamper-evident identity. This leaves second-hand markets rife with odometer fraud, hidden liabilities, and scams, while manufacturers face massive recall costs because data trails vanish after the first ownership cycle.

Second, the Industrial Gap. Mobility is not one industry; it’s a mesh of capital networks (banks, securitization platforms), utility networks (ride-hailing, V2G, charging), and trust networks (registration, compliance). Yet there is no neutral digital layer to let them transact atomically. Fleet operators cannot refinance assets based on live operational data. Insurers misprice policies because they lack standardized, machine-verifiable safety and usage proofs. The absence of a multi-chain orchestration layer keeps mobility’s value locked.

Third, the National Gap. Vehicles are inherently cross-border, but compliance is regional. Registration certificates valid in one country lose legitimacy in another. Taxation and insurance proofs are regional. Used-car exports into developing markets often bypass safety and environmental checks, flooding roads with high emissions. Without a protocol for local-first, global-next compliance, mobility remains trapped in jurisdictional silos.

These issues create friction everywhere—from customers doubting vehicle history, to fleet operators struggling with refinancing, to OEMs navigating a maze of regulations when selling in new regions.

The answer isn’t just digitization. It’s a new trust layer that bundles institutional, technical, and economic proofs into a single, verifiable identity for every vehicle. And that’s where Avalanche L1s could shine.

How Avalanche L1s Ends Up as The Perfect Solution  For The Automobile Industry?

Avalanche L1s are making a difference because they provide the purpose-built stack to address the challenges mentioned above by providing:

Data Access and Control Layer For Privacy

With the public blockchains, you cannot integrate permissioned access. Which means anyone can see the transaction happening on the blockchain. This could be detrimental to using blockchains because your competitor can see the business secrets. But this is a double-edged sword, because if you do not launch on a public blockchain, instead, launch a consortium chain, even then, your problem will still remain because not every player will be using the same stack as you. In that case, you still face the problem of data silos.

That’s where Avalanche L1s are providing data access and control layers that car manufacturers can use to interact with their peers and share only whatever is necessary for the smooth operation of the business, irrespective of the stack they use.

To do that, Avalanche L1s allow setting up administrator nodes with full control over the stack, thereby ensuring role-based access for regulators and competitors who are willing to collaborate but don’t have the means to do that without jeopardizing operations due to privacy constraints. And its bridges can also help interact with different chains irrespective of the stack they use.

Native Interop through Multi-L1 Architecture

Interoperability is a challenge when there are various players in the industry using different stacks for operation. Avalanche L1s are using multichain support through Interop using Avalanche Warp Messaging and Teleporter to allow communication, especially in the Delivery-versus-Payment (DvP) transactions. Because you need instant interoperability irrespective of the stack that two different applications are using when interacting with each other, this is highly suited for use cases such as BEVs, monetizing energy storage, logistics efficiency, and green transition.

Toyota’s MON 4-L1 prototype architecture below illustrates how Avalanche L1s can be configured for mobility with dedicated L1s for trust, finance, utility, and stablecoin payments, all connected through Avalanche Interchain Messaging (ICM). This modular design makes Delivery-vs-Payment and cross-network coordination possible in a way legacy infrastructure never could.

Cross-Border Compatibility Via Custom VMs:

Compliance is another major battle that the automotive sector is wishful of winning, but they do not get the means to help achieve that when they are operating in different jurisdictions. With the help of Avalanche L1 chains, automobile companies can create built-in KYC/AML checks, specifically targeting financiers and insurers.

At the same time, it is also possible to create an administrator dashboard using the Avalanche L1 stack and give role-based access to regulators to access important information and when needed. At the same time, preserving privacy in the process through eERC-20 features that Avalanche L1s are using.

Building The Fungibility Ladder

Making vehicles fungible is a major bottleneck for fleet owners because they cannot set up standards where they can self-identify the vehicles and make them readily available for financing in cross border operations. Avalanche L1s provide a fungibility ladder for these fleet owners dispersed across different jurisdictions through a standardized access to overcome this. Using Avalanche L1s, the automobile players can spin up their own chains and set up specific traits for their NFTs that can be easily exchanged overseas/cross border in a near instant, scalable  cost-effective and compliant manner, eliminating the friction to manage cross border fleet management that automobile players are going through at the moment.

Optimizing Cost For Faster Deployment

This is the most important aspect to consider when launching a blockchain-based automotive business, as you do not want to overburden yourself with unnecessary technology. Avalanche L1s are purpose-built because there’s no compulsion to stake like 2000 AVAX to run your validators for your chain.

With that being said, you are getting a stable infrastructure cost to launch your automotive application on top of Avalanche L1s, and despite their rigorous increase in usage, the cost wouldn’t be inflating in the near future because the L1s have Pay-As-you-Go, custom gas tokens, and other specs to keep the operations optimized from a cost standpoint.

At the same time, the consensus mechanism of Avalanche L1s is purpose-built as well to accommodate a scaling automotive sector with transactions matching almost 4500 TPS due to the random sub-sampling consensus mechanism. Martin Eckardt, Senior Director of DevRel at Ava Labs, specifically emphasizes the role Avalanche L1s are playing in keeping the cost low for efficient operations despite the automotive business scaling in a podcast between Zeeve’s CEO, Dr Ravi Chamria, and Francis Hanchem, founder of CodeNekt:

Future Proofing Mobility

Avalanche L1s have an advantage when it comes to future-proofing the mobility sector because they have the capability to bridge finance, mobility, and IoTs under a common stack, which no other stack has delivered so far. Due to this trait only, the Togg ecosystem in Turkey has partnered with Avalanche to take mobility to the next level.

If you are someone in the automotive industry facing the problems mentioned in this blog, Avalanche L1s can rightfully address them.

But if you are bothered that all of these would amount to spending hours to integrate the same, Zeeve can help you in this regard to launch your Avalanche L1 for the Automotive Industry.

Launch Your Avalanche L1 for Automotive Industry with Cogitus by Zeeve

Zeeve has a proven track record of launching more than 15 + Avalanche L1s in the last 90 days on its own platform. So, if you want to build your own purpose-built Layer 1 chain for your automotive business, Zeeve can help, from rapid node & network setup to RPC configurations to validator node settings, integrations, and more.

We also acknowledge the fact that you would like to continuously monitor your Avalanche L1 node, the Avalanche L1 dashboard that we provide will help you continuously monitor all the activities. In addition to this, you also get the benefits of 55+ integration partners that we bring on Zeeve.

Zeeve now supports $BABY delegation on enterprise-grade infrastructure, with 99.95% uptime, backed by SOC 2 Type II and ISO 27001 certifications.

This article focuses on $BABY delegation—what Babylon is, how it actually works under the hood, the numbers that matter right now, why staking BABY makes sense, and why delegating to Zeeve is the most pragmatic way to do it if you care about uptime, fees, and operational discipline.

What is Babylon?

Babylon is a Bitcoin-secured security layer that extends Bitcoin’s credibility to PoS chains and decentralized applications.

The protocol achieves this by separating the provider of security from the location of the throughput. Security comes natively from Bitcoin; throughput and coordination happen on the Babylon Genesis chain (a Cosmos SDK chain using CometBFT).

That split keeps Bitcoin where it excels, enabling economic finality and credible neutrality while allowing PoS systems to scale and interoperate.

This chain introduces a dual-staking design:

• BTC staking: Bitcoin UTXOs achieve finality for client chains; slashing enforcement occurs on Bitcoin.

• BABY staking: $BABY secures the Genesis chain, the control plane that routes Bitcoin-backed security and manages fees/governance. Earns rewards in return.

This transforms Bitcoin into a reusable finality anchor, making Babylon a security/liquidity coordination layer for Bitcoin-secured networks.

How Babylon Works? The Roles and the Flow

BABY-staked CometBFT Validator produces/validates blocks on the Genesis chain, runs governance upgrades/params, and keeps the control plane live. Delegators stake BABY to these validators and earn a share of the protocol’s rewards, minus the commission.

Finality Providers sign finality for blocks using BTC-secured credentials. Misbehavior can trigger on-Bitcoin slashing via EOTS (Extractable One-Time Signatures). No custodians. No wrapped BTC.

A block is final when a dual-quorum is achieved. This means that both validators and finality providers attest.

$BABY Value Accrual: Why the Token Matters?

Fees: BABY is the gas token for transactions and smart contracts on Genesis.

Security coordination premium: As more client chains subscribe to Bitcoin-anchored finality and liquidity routed through Genesis, the control plane accrues activity, captured in fees and validator economics.

Governance: BABY holders (directly or via delegation) set parameters that determine the price and scale of the security marketplace.

Staking rewards: BABY emissions/rewards compensate for validator work and delegator capital that keeps the plane reliable.

Why Delegate $BABY to Zeeve-run Babylon Validator?

Zeeve is an active Babylon validator with a track record of running institutional validators across multi-cloud, multi-region deployments.

Here are some more reasons to choose us:

Lowest commission among active validators: 3%

More rewards stay with you, compounding your long-term yield.

Proven uptime: 99.95%

High availability = more consistent rewards and fewer missed blocks.

Non-custodial by design

Delegate from your own wallet or regulated custody. Your keys, your control.

Enterprise-grade ops

Multi-cloud, multi-region, Sentry & backup nodes, auto-failover, 24/7 SRE monitoring, and enterprise SLA.

Security & compliance you can audit

SOC 2 Type II and ISO 27001 controls, strict IAM, continuous monitoring, audit-grade logs.

Full transparency

Track validator health, commission history, missed blocks, and reward accruals—export-ready for finance/compliance.

Frictionless flows

delegate/claim/compound/unbond flows with clear timelines, plus API access for institutions.

FAQs

1. What does it mean to “stake BABY”?
   You delegate BABY to a validator (e.g., Zeeve). Your stake increases validator security weight; you earn a share of protocol rewards, minus the validator commission.

2. Is staking with Zeeve non-custodial?
   Yes. You can delegate from your own wallet or a regulated custody account. Zeeve never takes possession of your keys.

3. Is there a minimum to delegate?
   Not with Zeeve. Running your own active validator requires 75,978 BABY (~$3,724), but delegators face no minimum.

4. How are rewards determined?
   Rewards depend on network parameters (inflation, distribution rules) and validator performance. The current APR is ~20.56% (with a recent 1-month delta of ~0.54 percentage points). Zeeve’s 3% commission is among the most delegate-friendly.

5. How long does unbonding take?
   Around 2 days (≈300 BABY blocks). Unbonding is an on-chain process; once complete, your tokens are once again liquid.

6. What makes Babylon’s “Bitcoin security” credible?
   EOTS ties slashing to Bitcoin UTXOs; penalties are enforced on Bitcoin, not via wrapped assets or custodians. The Genesis chain then uses a dual quorum (CometBFT validators + Bitcoin-staked finality providers) for block finality.

7. What about risk and slashing?
   All PoS networks carry operational risk. Zeeve minimizes it with redundancy, continuous monitoring, strict IAM, incident runbooks, and SLA-backed processes.

8. What if I want to run my own validator?
   Zeeve offers white-labeled Babylon validators for those who wish to run their own validator nodes, featuring the same enterprise-grade features and 99.95% uptime guarantees. Join the Discord to connect with the community, get support, and stay updated on the latest validator developments.

We’ve heard it all before—“healthcare needs transformation.” But after years of promises, patients are still locked out of their own data. Cross-border care remains a bureaucratic maze. And infrastructure that actually puts patients first is still rare.

Ulalo started with a vision to change that with a sovereign Blockchain. Live now on its own sovereign Avalanche Layer 1, Ulalo is powering a production-grade health wallet where patients own, control, and share their data — across languages, across borders, across devices. And it’s already doing what most healthtech platforms only promise—giving people true ownership of their medical records. Without delays, silos, and compromises.

Ulalo is a global health passport for the on-chain age—powered by AI, built for privacy, and now running on a sovereign Layer 1 chain built and managed by Zeeve Cogitus.

“ULALO’s vision is simple: to bridge people and the world. Our chain lets patients globally access top-tier healthcare and regain control of their data. Partnering with Zeeve and launching on Avalanche made this possible, providing the scale and integrity necessary to make a real-world difference in healthcare.”

— Fabrice Kwetchet, Founder & CEO, Ulalo

Avalanche L1 Gave Ulalo What Healthcare Demands

In Ulalo’s world, a patient scans a diagnostic report, the system runs AI classification, stores the result on IPFS, verifies it on-chain, and lets a doctor in another country review the data—all in seconds. That kind of real-time, cross-border flow can’t depend on a congested public chain or someone else’s mainnet rules.

Ulalo chose Avalanche L1 stack for its sovereign Blockchain because it offered deterministic finality, low and predictable fees, and the ability to control everything—from token logic to governance rules. As a sovereign chain, Ulalo could hardwire its healthcare logic directly into the infrastructure without compromise. No external dependencies, no cohabiting apps, no resource contention. Just a clean, scalable, healthcare-grade chain that doesn’t blink—even under pressure.

It also meant the Ulalo team could natively embed things like biometric authentication, real-time syncing across mobile devices, and multilingual interfaces—without having to ask permission from anyone.

That’s how you build infrastructure for 400 million underserved patients.

What’s Live on Ulalo Mainnet Right Now

Everything Ulalo promised on testnet is now live, running, and already in use.

Users open the wallet, scan a report, and AI classifies the data. It’s encrypted, stored off-chain, and the proof is logged immutably to Ulalo’s L1. The hash is verifiable. The access is controlled. And the data is shareable instantly — no silos, no follow-ups, no risk of leakage.

Doctors get reliable histories. Patients stay in control. Insurers get integrity. And it’s already powering:

• Multilingual, patient-facing health wallets

• Live biometric-auth syncing across devices

• AI-based health alerts with structured record analysis

• Smart record-sharing with expiry and permission controls

• $ULA-based insurance and ecosystem interactions

The foundation is now real. The user journey is real. And the infrastructure is ready for scale.

Zeeve and Cogitus Made Mainnet Feel Like Mission Control

Ulalo didn’t just need help launching a chain. It needed production-grade reliability with zero learning curve and zero fragility.

With Zeeve Cogitus, Ulalo got a chain that behaves like a backend platform — not a lab setup.

Zeeve took full charge of the infrastructure — from provisioning to production — with:

• Custom Avalanche L1 deployment, tuned for AI, healthcare ops, and global sync

• Dedicated RPC infrastructure to handle wallet and app usage at scale

• TraceHawk Explorer integration for network transparency, data verification, and audit trails

• 24/7 monitoring and observability, with health dashboards and real-time alerts

• Critical path support, ensuring every component stays up — even in high-dependency environments

“Ulalo’s chain had to meet a higher bar. It’s not about performance metrics. It’s about being unbreakable when lives are on the line. With Cogitus, we didn’t just power a mainnet — we operationalized trust.”

— Dr. Ravi Chamria, Co-founder & CEO, Zeeve

Ulalo is now mainnet live. $ULA is preparing for its next exchange listing. Strategic partners are coming on board. But more importantly, the chain works. Right now. In production. And it shows what’s possible when builders go full-stack with the right infra partner.

So if you’re building for healthcare, digital ID, public health systems, or global data sovereignty—Ulalo’s path is now open. And Zeeve’s Cogitus stack is ready to get you there.

Let’s build the next real use case. For patients. For people. For production.

• Arbitrum Orbit Rollups

• Arbitrum Orbit AnyTrust chains

• Custom Orbit chains

These solutions are solving some of the pressing challenges of different projects, and their choice can fundamentally define a chain’s security, cost, and performance profile.

In this blog, we’ll highlight the challenges that these stacks are purpose-built to solve, and which use-cases must pick them as their go-to stack. So, without any further ado, let’s get started.

Top-3 Arbitrum Orbit Solutions, their features, and real projects built using them

1. Arbitrum Orbit Rollups:

Orbit Rollups are the most secure variant within the Arbitrum Orbit family. They follow the classic optimistic rollup model, where transactions are sequenced, compressed, and posted on Ethereum as calldata. Now, with the implementation of Ethereum’s EIP-4844, it is more cost-effectively posted as data “blobs”.

This on-chain data posting is the bedrock of Arbitrum Orbit Rollup’s security model. Because all transaction data is publicly available on the parent chain, any participant in the world can independently download it, reconstruct the L2’s state, and verify its correctness.

I) This enables a system of permissionless validation where any honest actor can detect fraud and challenge an incorrect state assertion. This challenge is resolved through Arbitrum’s battle-tested, multi-round, interactive fraud-proof system, which efficiently narrows down a dispute to a single computational step that is then verified on-chain.

II) By inheriting the full data availability and security guarantees of its settlement layer, an Orbit Rollup makes no additional trust assumptions beyond those of Ethereum itself.

III) The trade-off, however, is that Ethereum DA comes with higher posting costs and longer withdrawal times, especially for Orbit L3s that must pass through Arbitrum One before final settlement.

IV) While this model is the most expensive due to L1 data posting costs, this expense is best understood as a premium paid for unparalleled security. The Ethereum Dencun upgrade, which introduced EIP-4844, served as a crucial defensive measure for the Rollup model. By creating a separate, cheaper data market in the form of blobs, it significantly lowered this security premium, ensuring that Rollups remain an economically viable and competitive option for their target market.

Key Use-Cases that can be built as Arbitrum Orbit Rollups:

The Rollup model is the definitive choice for applications where security is paramount and cannot be compromised. These are typically protocols that secure immense value or operate in environments with stringent regulatory and compliance requirements, where any additional trust assumption can be costly.

For example,

• High-Value DeFi:

Protocols such as decentralized exchanges (DEXs), lending markets, and perpetual platforms that manage billions of dollars in TVL/TVS require the unassailable security of Ethereum to protect user assets.

For these applications, the term “Rollup” has become a brand synonymous with “Ethereum-grade security,” and definitely signals trust to users and liquidity providers.

• High Value Real-World Assets (RWAs):

Platforms tokenizing assets like real estate, private credit, or government treasuries must present a clear and defensible compliance posture to attract institutional capital and people’s trust.

The transparency and verifiability of posting all transaction data on-chain are fundamental requirements for this sector.

• Bridges and Core Infrastructure:

Most of the TVS is held in bridges. Such kind of foundational protocols that are responsible for securing assets from numerous other chains cannot afford to introduce new vectors of trust.

Some Projects Successfully Deployed As Orbit Rollups Chains

AnimeChain

Animechain is specially designed for the Anime community, where they can enable on-chain licensing, monetization, and creation of anime characters. For this purpose, they sought very high TPS and faster finality, while also inheriting security for users in a trust-minimized manner.

Orbit rollups with ETH as the settlement layer delivered to meet this demand for Anime. Through Orbit rollups,  Anime was able to clock 40,000 TPS with a 250 ms blocktime. Moreover, they were also able to do gasless onboarding, transparent right management, and so on and so forth.

Reya Chain

Another project using Orbit rollup is ReyaChain, which aims at unifying the CeFi, DeFi, and Tradfi ecosystems into a single hub. Besides leveraging the common Orbit’s features like speed, scalability, and throughput, the extended customization has allowed Reya to adopt an architecture with financial logic integrated directly into the network. This enables liquidity flow to be accessible by various applications all at once.

Also, Reyachain could fulfill its requirement for a different DA, which is a hybrid DA setup. Within this, the orders and executions get posted on Celestia (external DA), and account data is pushed to the Ethereum Layer 1. For settlement, Reyachain uses Ethereum.With this support, ReyaChain is hitting 200k+ trades a week, multiple collateral & instruments for 60 markets through 100ms blocktimes, MEV-free trades, deep liquidity, high availability, and more.

2. Arbitrum AnyTrust Chains

The Arbitrum AnyTrust protocol offers an equal alternative to the traditional public rollups. These AnyTrust chains are designed to drastically reduce costs while maintaining strong security guarantees.

For AnyTrust chains, instead of posting full transaction data to Ethereum, the sequencer sends the data to a permissioned Data Availability Committee (DAC).

The members of this committee run specialized Data Availability Server (DAS) software to store the transaction data off-chain, and collectively sign a Data Availability Certificate (DACert).

I) The security model of AnyTrust is built on a ‘minimal trust assumption’.

II) The system remains secure as long as a small minority of DAC members (for example, 2 out of a committee of 20) are honest and will provide the data when requested.

III) In specific use cases, this is a significantly more robust and easier-to-satisfy assumption than the supermajority (e.g., 14 out of 20) required by conventional public rollups.

IV) However, the most interesting feature of AnyTrust is its “fallback to rollup” mechanism.

If the DAC fails to cooperate and does not produce a DACert for a batch of transactions, the protocol forces the sequencer to post the full transaction data on-chain, exactly like a standard Rollup.

V) This one security step ensures that the chain’s liveness is always preserved and that its security is ultimately tethered to Ethereum. This makes AnyTrust a “conditionally secure rollup” if we want to say so.

VI) Plus, this minimal on-chain footprint of AnyTrust enables powerful features that are difficult for Orbit Rollups to support, like the ability to use a custom ERC-20 token for gas fees and fast withdrawals that can bypass the standard 7-day challenge period.

Key Use-Cases That Can Be Considered for Building on Orbit AnyTrust Chains

AnyTrust is perfect for solutions for applications where high throughput and ultra-low transaction costs are critical for delivering a viable and engaging user experience.

The sectors below represent the largest untapped markets for Arbitrum AnyTrust and are poised to drive the next wave of adoption.

Web3 Gaming:

On-chain games often require thousands of low-value, high-frequency actions, such as minting in-game items, updating character states, or executing small moves.

The sub-cent transaction fees offered by AnyTrust make complex and immersive on-chain game logic economically feasible for gaming chains.

Consumer Facing Applications:

• Social Apps: Social apps are looking for low-fee messaging and micro content sharing in a scalable and verifiable manner. AnyTrust chains are built to deliver transactions at scale because they can use their own DAC committee for data posting and achieving near infinite scale.

• Payments & Microtransactions: For consumer payment apps, AnyTrust architecture can be a perfect fit. The ultra-low fees enable use cases like in-app purchases, tipping, and other such small-value transfers in-expensive.

DePIN & High-Frequency DeFi:

Sectors like Decentralized Physical Infrastructure Networks (DePIN), which rely on frequent micro-transactions from a large number of devices, or decentralized derivatives exchanges with high-frequency order book updates, find a perfect technical and economic fit in AnyTrust’s performance profile.

AI Agents & Web3 x AI Applications:

The rise of AI Agent uses on-chain creates an immense demand for high-frequency, low-cost transactions. These agents signal, transact, and respond hundreds of times per session. AnyTrust provides the cheap and predictable data availability needed for such AI agent markets. This makes it an ideal infrastructure for the emerging DeFAI sector, also.

Some Project That Successfully Deployed As AnyTrust Rollups

XAI Games

XAI Games wanted to solve the problem of gameplay in the Web3 space. For example, most of the games are lacking experience; rather, they delve more into economies. But with that model in mind, it is hard to onboard the AAA games, the OGs of the Web 2 gaming world. XAI games solve this by providing a ready-to-deploy environment for game builders.

They use AnyTrust chains for that because it provides lightning-fast transaction speed, as platforms like STEAM, the Web 2 gaming launchpads have 100 M users. To compete with them and onboard all of them to Web 3 as a launchpad, XAI needs lightning-fast transactions, a fully gasless experience,  seamless onboarding, and quick settlements. Orbit AnyTrust chains were purpose-built for that.

SkyNet

The core challenge of an AI economy is handling millions of microtransactions at extreme scale with predictable, low costs. Skynet is building an AI-optimized L3 Arbitrum Orbit chain with a goal to be the transactional backbone for a future where AI-agents can outnumber humans.

They choose AnyTrust model for this ‘cheap & predictable’ data availability, which is essential for such high-frequency AI agent markets.

Launched with the expertise of Zeeve Rollups-as-a-Service, Skynet chain is highly customized with features like a SKYUSD gas token for its AI-driven ops.

Learn More Here: Skynet’s New Blockchain on Arbitrum Orbit will Scale AI Agents at Warp Speed

PropFTX

PropFTX combines AI with Orbit functionalities to offer fractional ownership for real estate industry and allows users to buy, sell, and invest in tokenized shares of high-value commercial properties.

For a consumer-facing investment platform that requires frequent, low-cost interactions and a seamless UX, AnyTrust DAC model is an ideal choice. It provides the necessary scalability and affordability to make fractional investing accessible, and RaaS support from Zeeve ensures a robust and reliable infrastructure.

3. Custom Arbitrum Orbit Chains

Custom DA chains are in support of the modular thesis and allow Arbitrum Orbit chains to integrate with external, specialized data availability networks. Here, the Orbit chain’s sequencer posts transaction data directly to a third-party DA layer.

In return, it receives a cryptographic proof of publication, which is then posted to the settlement layer (like Arbitrum One) to be included in the state root.

Though this model introduces a new set of trust assumptions, as the security and liveness of the Orbit chain become coupled with the cryptoeconomic security of the external DA network’s validator set as well.

Here are some DA layers that can be integrated with the Arbitrum Orbit chains:

• Celestia: The first modular DA network to integrate with Orbit, Celestia uses Data Availability Sampling (DAS) and Namespaced Merkle Trees (NMTs) to allow light clients to verify data availability without downloading entire blocks. Its integration with Orbit relies on Blobstream to relay data commitments back to the parent chain.

• EigenDA: Eigen layers DA solution leverages Ethereum’s economic security through EigenLayer’s restaking primitive. Orbit chains using EigenDA can achieve massive throughput secured by a decentralized network of operators restaking billions of dollars worth of ETH.

• Avail DA: Originating from within Polygon, Avail focuses on validity proofs (specifically, KZG commitments) for data availability, which can offer faster finality guarantees without the need for extended challenge periods.

The choice between these providers is a strategic alignment with a specific security philosophy. It can be the independent proof-of-stake security of Celestia or the Ethereum-aligned restaking security of EigenDA, or maybe the extremely cheap cost of NEAR DA.

Read More About Data Availability Solutions Used in Layer2/ Layer3 Chains:

1. Alt DA Solutions Changing the Cost Game for L2 Rollups: Spotlight on Key Players

2. Data Availability Layer in Rollups: What is it and why do we need one?

Key Use-Cases That Can Be Considered for Building on Orbit Custom Chains

Applications here have the requirements that exceed even the high performance of AnyTrust; those who seek a greater degree of sovereignty and deeper integration with a broader modular ecosystem can look into this category.

So in one line, we could say, this category is ideal for those who are willing to accept a more complex and novel security model in exchange for ultimate flexibility and the lowest possible costs.

Fully on-chain Gaming:

For games that aim to put every action and asset on-chain, the extreme cost reduction offered by Celestia or other AltDA platforms in combination with the Nitro stack is a necessity. Because they might need a massive volume of transactions to be virtually free, this goal can only be achieved by moving data availability to a hyper-optimized additional chain.

High Value DeFi & RWAs

DeFi and RWAs are looking for high-value trade, but for that matter, they don’t want to be restricted by the limitations of storing data only on Ethereum or to a limited set of DAC nodes; rather, they want other custom economic data storage solutions, KYC, and other compliance.

Interoperability Hubs

Interops hubs unify security at a single checkpoint; as a result, they cannot operate in a trust-minimized manner. Custom rollups give them an edge to choose a DA layer that can be trusted, and at the same time, it is cost-effective as well.

Some Projects That Successfully Deployed As Custom Rollups

These categories of applications often have requirements that exceed even the high performance of AnyTrust, or they seek a greater degree of sovereignty and deeper integration with the broader modular ecosystem.

Though the custom Orbit rollup is new, it’s been adopted by some of the innovative and new-age projects, such as;

Kinto

Kinto, the modular exchange, has migrated to Arbitrum Orbit to seek a better level of security, data integrity, and regulatory compliance matching traditional finance. It uses Arbitrum Nitro Stack to operate as a rollup operating in parallel with Arbitrum One and Nova while being fully compatible with the Ethereum Virtual Machine (EVM), and settles transactions on Ethereum Mainnet.

Kinto uses Celestia as its external DA layer. The network collects all sequencer fees (gas) from network transactions, and its revenue comes from the spread between these fees and the cost of settling the batched transactions on Ethereum Mainnet. Regarding the token, Kinto uses $KINTO as its governance and utility token. With all these features, Kinto has been able to build a fully KYC-compliant L2 that can support both the modern finance and decentralized DeFi protocols.

Alpha Dune Network

Alpha Dune Network is a Layer3 solution built with an Orbit stack for ultra-fast and low-cost transactions that is integral in DeFi. Built as a custom chain, Alpha Dune has integrated Celestias as the DA layer while still using Ethereum-level security.

Other features that Orbit offers to the network are modular, on-chain scaling, and decentralized governance. Regarding the token, Alpha uses the DUNE token as its native gas token to power every transaction and interaction, including asset transfers.

Plume Network

Plume is an RWA / real-world (RWA) focused project to ensure 100% compliance in RWA activities like earning yield, trading, speculation, lending/borrowing, etc. Built as a modular & permissionless L2, Plume uses Orbit as its custom rollup stack and Celestia as an off-chain DA layer.

Plume is home to 80+ RWA (Real World Assets) and DeFi projects. Orbit’s customization features allow Plume to manage its projects and high-traction network seamlessly. Speaking about token, Plume Network utilizes PLUME for transaction fees, staking, governance, and various incentives within the ecosystem.

The ecosystem also features Plume USD (pUSD), which is a stablecoin wrapper for USDC, and Plume ETH (pETH), a liquid staking token that is pegged to Ethereum.

Which of These 3 Types of Arbitrum Orbit Chain Could See More Adoption?

First, the largest addressable markets for new blockchain applications are in consumer-facing sectors like gaming, payment, and social media, which are fundamentally incompatible with the fee structures of the Rollup model.

Second, while Custom DA chains also meet this demand, AnyTrust is a more pragmatic and lower-risk path for the majority of developers. It offers the ultra-low costs needed for consumer applications while retaining a native, battle-tested security backstop in the form of the Arbitrum protocol’s fallback mechanism.

For a new project launching in 2025, choosing this tightly integrated, in-house solution is a more conservative and predictable path to scalability than adopting an external dependency on a separate, still-maturing DA network.

Though we feel all three chains will see adoption, with the highest possibility being for AnyTrust & Custom Orbit chains.

Build Any of These 3 Types Arbitrum Orbit Solution with Zeeve RaaS

The whole explanation in this article highlights the rising demand for the Arbitrum-powered solutions. If these features align with your project requirements, Zeeve RaaS is your ideal partner to build your own sovereign, performant, and customizable chain as per your needs: Be it Orbit rollup, AnyTrust Chain, or Custom Orbit chains.

With support for AnyTrust mode, Stylus (Rust/C++), and 55+ third-party integrations, Zeeve gives you the tools to design, deploy, and evolve your Orbit chain your way. And when you’re ready to go beyond the testnet, Zeeve offers you smooth mainnet migrations with your default settings and required integrations in the fastest possible time.

Talk to our experts to discuss your requirements. We’re here 24/7 to help you go from idea to execution — faster, cheaper, and fully in control.

They kind of capture the full money movement revenue stack. JPYC’s Yen Yen-backed stablecoins, Wyoming USD-backed FRNT, and LG CNS Won-based stablecoins are making headlines at the moment due to their anticipated launches. In all this news, there’s a common name, Avalanche, ending up as the perfect battle-tested stack due to its credible 10+ stablecoin launches. A few days ago, South Korea announced its own stablecoin on an Avalanche L1.

In this article, we shall see why stablecoins are suddenly going in trend  and how  Avalanche L1s for stablecoins have provided the perfect base to build them. But before we do that, let’s give you a brief overview of Avalanche L1s

What are Avalanche L1s?

Avalanche L1s are sovereign blockchains with their own rules defining their operations, independent of the consensus layer. Due to this feature, they are ending up as the perfect choice to build not just stablecoins but different purpose-built L1s on top of them.

Read More: How Avalanche Became the Perfect Platform to Launch 100+ L1s in 2025?

But why are stablecoins trending intensively at the moment to create a race condition among governments, institutions, and corporations to use it? Is it because of the adoption, utility, or something else? Let’s find that out.

Stablecoins: A Then Vs Now Journey Defining A Transition In Action

When you think about stablecoins, the first and foremost thing that would come to your mind is that it was an important tool for crypto traders to hedge against market volatility during their inception period. But with the changing times, their identity changed.

Now stablecoins are not just a means to hedge against market risk for traders, rather,  they are an integral financial vehicle to revolutionize modern finance because institutions and governments are integrating stablecoins to overcome some of their innate challenges like settlements, payroll, cross-border remittance, and so on and so forth.

But in this pursuit, they are indeed facing some systematic failures nonetheless when those stablecoins are launched on public blockchains. For example,  Franklin Templeton started using stablecoins like USDC developed on public blockchains to expedite settlements, but while doing that, they faced a few pressing challenges, like;

• Compulsion to keep a huge amount of USDC buffer for providing near instantly liquidity as and when required to the users.

• High dependency on ZeroHash for providing on/off ramp services, which further complicated compliance and settlement rails.

• Blockchain network performance issues arise because launching stablecoins on top of public blockchains amounts to consensus delays, downtime, and privacy issues, which have an adverse impact on share redemption. And in most cases, they had to switch to manual systems to accommodate the same.

• High Operational cost for Franklin Templeton because they had to pay for the gas of the users, as using USDC didn’t allow payment in native tokens.

• And last but not least, regularity uncertainty, tech vulnerabilities, and other risks further plagued the operations.

Citing these reasons, Circle has been thinking of a purpose-built  L1 for USDC to provide such institutions the leverage to issue their own gas tokens, control transaction costs, and keep network performance isolated from unrelated activity. But why is Circle inclined to provide a custom layer for stablecoins? Are they going to turn mainstream in 2025?

Emerging Use-Cases To Make Them Mainstream for Adoption

1. Trade Facilitation

In 2025, economies like the EU, UAE, and Hong Kong have created clear guidelines for derivative trading; thereby, attracting the interest of the institutions and retail platforms to build and expand their services.

For that matter, Stablecoins are acting as a perfect solution to move in and out of volatile assets. Stablecoins are still used for short-term holding between trades. But for institutions to use them, they should be coming up with advanced features to provide privacy controls, scale, and security.

2. National Currency Internationalization

Most of the economies are in a race to launch their own fiat-backed stablecoins. For example, China is exploring Yuan-backed stablecoins; similarly, the EU is accelerating the plan to make Euro-backed stablecoins in 2025 to compete with USD-backed stablecoins. But while doing all of these, they need to stay compliant and trade at scale.

3. Corporate and Institutional Adoption for Faster Settlements

Now, stablecoins are growing beyond speculation, with SpaceX sending back funds from Starlink sales in Argentina and Nigeria, and ScaleAI pays overseas contractors with them.

Institutions are increasingly exploring new use cases for stablecoin infrastructure, and it’s driving increased on-chain credit activity.

Institutions are also progressing to use stablecoins due to the regulatory immunity that they are going through upon showing their verifiable backing.

Some of the key names like Bank of America, Standard Chartered, PayPal, Revolut and Stripe are already exploring options to use them. But they want a great infrastructure, liquidity to make that happen.

4.The Yield Paradigm

On top of trading and payments , stablecoins are used in DeFi to earn yield:

So if stablecoin supply grows, established DeFi protocols will likely benefit from it:

– Aave/Morpho/Euler/Fluid

– Uniswap/Curve

– Maker

– Ethena

Yield is a key factor that influences stablecoin dynamics. Yet, probably the juiciest trades will come from new infra/consumer-facing/yield apps that are yet to launch. New, exciting tokens usually attract more attention.

How Avalanche L1s Could Make a Huge Difference?

If institutions,  government, and  retail want to use stablecoins, they need a few things to be resolved from the ground up, which the Avalanche L1 stack has been proposing through the following trade-offs;

1. Purpose Built Scale

When you want purpose-built scale, you need the readiness of the tech to meet any amount of scalability as and when needed.

Avalanche L1s for stablecoins are almost purpose-built because, unlike PoW/ BFT consensus engines, the Avalanche L1s use random sub-sampling. Due to this, instead of every validator having to validate for the blocks, a selected number of validators can simultaneously validate all the transactions coming. Due to this, Avalanche L1s are able to meet even 4500 TPS, almost equalling or surpassing Visa.  Moreover, Avalanche has another major trade-off that you need when launching a stablecoin: the TTF or Time To Finality. Here as well,  Avalanche L1s has left no stone unturned to end up as the perfect stack with sub-second finality due to its recent upgrades.

Extremely Economical Operations

When you are launching a stablecoin on top of a blockchain, you have to acknowledge the point that these coins are accounting for $1.48 trillion in transactions spread across DeFi, lending, and exchange platforms.   That said, the infrastructure supporting the stablecoin should be such that it can accommodate such a scale at a fraction of the cost; otherwise, the whole purpose of using stablecoins will be defeated. For example, suppose you are performing all these transactions on blockchains like Ethereum, you will have to incur $61 M in fees. But the whole equation changes when your blockchain stack has such features to optimize  massive scaling at a fraction of cost.

In this regard, Avalanche L1s make the difference because of the ACP-125 upgrade. Under ACP 125 upgrade, the fee reduction hits a critical point from 25 nAVAX to 1 nAVAX, which is like a 96% reduction in fees. So, if an institution/ government was spending supposedly $3,189 on gas fees other stack, now they will be spending $579 due to this upgrade, which is purpose-built to accommodate transactions at scale that stablecoins demand.

Subnet Architecture for Custom Chains

Like it was said in the stablecoin then vs now section, Franklin Templeton had to manage compliance using ZeroHash, on Avalanche L1s, launching a stablecoin to use for any purpose wouldn’t have to go down that road because of the subnet architecture. The subnets will provide almost a custom application deployment environment which means you can integrate KYC/ AML, access control, role-based access, auditability, verifiability and privacy controls. And the best part would be that you are doing all of that without congesting the network or putting the performance at risk.

EVM Compatibility

With Avalanche L1s, you also get EVM compatibility while launching stablecoins. Which means, you do not have to think about liquidity bottlenecks because the tech infrastructure would be such that you can easily import liquidity from other ecosystems. For that matter, the Avalanche L1s would be helping in this regard by allowing the new stablecoins issued to partner with Avalanche Native DeFi protocols like DEXes, money markets like BENQI, and Yield Yak. Moreover, there’s also provision where you can bring in bootstrapped liquidity for your stablecoins on Avalanche by deploying different mechanisms like Native Tokens Incentives and other means to attract that and since the chain will be EVM compatible, other ecosystems can also tap into these offers.

Battle Tested Security

Last but not least, when you want the freedom to move value across borders, within the country and even empower merchant level adoption using stablecoins, security should be the tipping point to acknowledge. In this regard, Avalanche L1s are purpose built because of institutional participation as validator nodes to validate for the chains. Which means, if you want to put institutions as validators for your L1 chain for stablecoins, you can go ahead and do that with the Avalanche L1.

At the moment, top names like FiFa, Deloitte and Watr Foundation are validating for the Avalanche L1 chain. This is what as an institution or a government you need that your stack should provide peak security that Avalanche L1s are delivering from the grounds up for the Stablecoin launch.

Stablecoins have a long way to go because it is expected that they will touch $2 T by 2028. So, if you want to integrate the same in your business process and want reliable support to help in this regard, Zeeve can help you.

Launch Your Stablecoin on Avalanche L1s with Zeeve

Zeeve has been helping in simplifying  the  development of your stablecoins on Avalanche L1s (Formerly known as Subnets) using a wide range of tools and its own platform. So, if you want to build your own stablecoin as per your use-cases specific requirement, from rapid node & network setup to RPC configurations to validator node settings, Zeeve would be catering to all that your  Avalanche L1 custom chain requires in a frugal manner without compelling you to undertake  heavy investments for building the infrastructure.

In addition to this, Zeeve also offers a powerful Avalanche L1 management dashboard to give you  detailed insights and a real-time view of your active L1s and their vital aspects, such as node performance, validators, account & access control configuration, as well as system-level monitoring.

With more than  30+ third-party integrations, you get everything to building your scalable stablecoin on Avalanche L1 custom chain. If you want to build your next stablecoin as soon as possible and don’t know how to get started with it, just speak to all our experts and we can help you launch your stablecoin on Avalanche for enterprise grade usage.  For more information,  Email us your queries or schedule a one-to-one call for an Avalanche L1 demo.

Avalanche L1 for Finance: Motivations Driving Different Projects To Build With this L1 Stack

From the vantage point, most of the finance-based projects often look for compliance, scalability, security, and performance in any stack for custom chains. But, new-age finance projects look for way more than this.  Avalanche L1s are delivering that to CeFi and DeFi to get motivated to choose it as a go-to layer for development. Let’s look at a few projects around the CeFi and DeFi category  to understand this;

Avalanche L1s stack is the go-to choice for world-class CeFi projects but why: A Project Oriented POV

Top CeFi companies in mainstream categories have opted Avalanche L1 as their appchain stack to build a sovereign chain that can match their changing business needs and meanwhile match with the current standards of the finance industry. Let’s dive deeper:

1.Institutional Payments:

Institutions are looking for a few things to be assured upfront while using blockchain technology like speed and settlement, programmability, global reach and interop. Avalanche L1s are purpose built for that because you can integrate access controls, specify accountability and auditability. That’s why these  CeFi players around institutional payments chose Avalanche L1s;

• Onyx by JP Morgan & Chase Co.

JP Morgan & Chase Co., the prominent global financial holding company, is using Avalanche’s custom, permissionless Evergreen subnet for their Onyx platform. The launch aims to embrace web3 strategy to streamline their repo operations & settlement. The platform is currently used by major financial institutions like Goldman Sachs, DBS Bank, and BNP Paribas. JP Morgan has picked Avalanche Subnet for the following core reasons:

• Representing all the investments as tokenized funds to standardize plus automate the funding, order execution, and settlement for both their traditional asset classes and alts required a purpose built stack for meeting best outcomes.

• Increased efficiency and scalability through deployment of smart contracts that represent discretionary portfolios that are easily programmable.

• Avalanche L1’s seamless integration with 3rd party services has allowed the chain to include Account Abstraction concepts through Biconomy’s Paymaster service. This has abstracted the complexities related to payment and transaction fee settlement

• Complete sovereignty dedicated throughout to process 100M+ annual B2B payment transactions.

• ANZ’s Subnet:

Australia and New Zealand Banking Group (ANZ), which serves over 8.5 million customers across nearly 30 markets, collaborated with Chainlink to improve the settlement of tokenized assets using an Avalanche L1. By integrating Chainlink’s Cross-Chain Interoperability Protocol (CCIP) with

Speaking about this, Anurag Soin- the Product Lead Digital Added Services at ANZ said, “Avalanche’s Evergreen Subnets have allowed ANZ to join the list of institutions exploring new use cases and business models while leveraging customizable networks like Avalanche.”

Below are the main reasons that encouraged to opt for ANZ utilized its own Avalanche L1:

Here are the reasons that encouraged ANZ to build with Avalanche:

• Smooth integration and interaction with Ethereum-based assets.

• Secure, efficient, and tailored transaction processes with permissioning and Custom Gas Token.

• Simplified cross-chain DvP settlements through atomic transactions.

• Zero backend complexities to provide a seamless frontend experience for users.

2. Asset and Investment Management:

Projects that are built for asset and investment management often face challenges such as adding fine-grained permissions in the smart contract, customizing the validator setup, ensuring secure and compliant operations, and most importantly to achieve interoperability with the legacy systems and infrastructure. Avalanche L1 stack is designed to address all these shortcomings and a number of additional benefits. Here’s how the below mentioned projects used Avalanche L1s in their best of capabilities to overcome challenges;

• Inversion Capital

Inversion Capital has been tackling one of crypto’s biggest challenges, which is adoption, by  using Avalanche’s Layer 1 (L1) capabilities. With this, Inversion aims to transition their traditional businesses onto blockchain rails, bringing its 1B+ users on-chain.

To put it in a nutshell, below are the key reasons Inversion Capital launched their own Avalanche L1:

• Avalanche enables Inversion to apply permissions across multiple levels—be it validators, smart contract deployers, or transactions.

• Avalanche’s support for wallet and transaction privacy through eERC20 standards safeguards users’ confidentiality on Inversion while maintaining the adherence to ERC standards.

• EVM compatibility helps Inversion to attract more developers and assets.

• Native Interoperability of Avalanche allows Inversion to seamlessly integrate existing systems and build critical infrastructure.

• With the Avalanche9000 network upgrade, Avalanche L1’s launch and management has been effortless and cost-efficient for Inversion; no more a 2000 AVAX compulsion to launch their own validator sets.

• With customization in gas and staking fees and tokens, Inversion gets the flexibility to creatively establish its validator set while adding real utility and value to its native token.

3. Liquidity:

Liquidity-focused projects seek to tackle key issues, such as fragmented liquidity pools spread across multiple chains, causing inefficient markets and higher slippage. High transaction fees and slow processing inhibit active trading and reduce liquidity provider motivation;thereby, deleting a lot of use cases like perps, money markets and CLOB based models. Additionally, limited access to asset classes, coupled with regulatory hurdles impacts participation, especially from institutional players. Also, security concerns impact user trust in liquidity solutions. By creating their own Avalanche Layer 1, these projects seek to unify liquidity, lower costs, increase transaction speed, enhance incentives, and ensure regulatory compliance to build deeper, more efficient, and accessible liquidity ecosystems.

• Dinari Finance

Dinari Finance, the leader in offering tokenized U.S. public securities, has launched its Avalanche L1 chain to achieve omni-chain liquidity and seamless settlement for all the Dinari’s partner networks. Dinari manages 25K+ customers and 150+ assets across top 80 countries.

A sovereign L1 allows Dinari Financial Network to be compatible with diverse blockchain environments through the omni chain capability while Avalanche offers the underlying consensus layer for sub-second finality, automation of compliance, and network’s composability across various DeFi and institutional partners.

This launch represents a foundational milestone toward enabling scalable, secure, and regulated round-the-clock trading of U.S. equities. It allows investors globally to access capital markets through a unified, transparent infrastructure layer. Similar to the DTCC’s role in traditional finance, Dinari’s blockchain is designed to uphold standards and facilitate settlement via a neutral coordination layer—tailored to meet the demands of modern markets.

4. Asset Management:

Asset Management solutions are booming in finance, but at the same time, they face challenges such as scalability bottlenecks, high transaction fees, lack of interoperability, limited privacy, and rigidity in customizing blockchain parameters. Avalanche Layer 1 solves these by offering high throughput and near-instant transaction finality, reducing latency and costs critical for active asset management. Its native interoperability facilitates seamless integration with other blockchains, improving liquidity access. Let’s see how projects in asset management category have been utilizing this stack:

• IntainMarkets

Intain Inc, the global platform in structured finance and administration earlier launched its Avalanche Subnet (now Avalanche L1); IntainMarkets. Intain manages a huge ecosystem with  240K loan reviews and $23B deals onboarded on the platforms. With IntainMarkets, Intain Inc. has been able to solve complex finance-related challenges while fulfilling the regulatory and other application-specific requirements that are integral to sustain in a market that has created 2T of asset-backed and mortgage-backed securities in 2022 (as per SIFMA).

Besides the key features; compliance and customization, the major benefit that Intain gets from Avalanche is fast transaction processing. Through the traditional off-chain approach, the platform has made some sub-$100M transactions which were prohibitively expensive. Now with an on-chain platform will enable IntainMARKETS to make $8–10 million transactions while maintaining economic viability.

Avalanche L1s are Equally Suitable for DeFi Chains as well

DeFi projects that are leading in the current space; either by TVL, innovative features, unique offerings, user trust, and so on, have already opted to build with Avalanche L1 stack. Below are the top DeFi projects are thriving with this appchain stack amid the challenges in the finance industry:

1.Trading, Exchange & Investment:

Avalanche Layer 1 is an ideal stack for decentralized exchanges to achieve flexible TPS, fast finality, reduced latency and optimized trading costs critical for active markets. Its unique multi-chain architecture (X-Chain, C-Chain, P-Chain) optimizes different blockchain functions such as asset creation, smart contract execution, and staking coordination, improving efficiency. Here’s how Dexalot L1 and Watr is doing this:

• Dexalot L1

Dexalot, the popular non-custodial and omni-chain DEX that handles 964M+ transactions and $31.5B+ trades in volume, has been operating its Layer-1 chain powered by Avalanche to bring sub-second execution of trades similar to centralized exchanges but on-chain. The L1 currently has a TVL of $4.11M, 6.045 TPS, and total transactions as 359.36M. With Avalanche L1, Dexalot get the following capabilities:

• Ultrafast transaction finality.

• Intuitive UI/UX.

• Reduced Slippage.

• Full possession of assets to users.

• Integration with messaging passing protocol; LayerZero.

• Greater efficiency for cross chain operations because of Avalanche Wrap Messaging.

• Hybrid architecture to deposit assets on the Avalanche C-Chain and trade them on the L1.

• Watr

Watr; the purpose-built blockchain infrastructure with a $20 Trillion global economy has confirmed its migration to an Avalanche L1-powered sovereign chain to align with the DeFi future.

Regarding this, Maryam Ayati, the Founder and President of Watr Foundation mentioned, “Established Web3 concepts such as DeFi, Decentralized Identity, and smart contracts can address fundamental constraints in commodity financing, compliance, and trade,” said “Building with Avalanche allows us to leapfrog the development cycle and leverage its ecosystem’s size and security to decisively take on this opportunity.”

Avalanche L1 provides Watr the following abilities to make a difference across the commodities and trading industry:

• Untapped Liquidity

• Programmable smart contracts for automated trade execution and risk tackling.

• Reduced fraud through Trust-based, identity-based transactions.

• Enhanced compliance and provenance, and sustainability into trade.

• Ability to move liquid capital and finance assets moving at lightning fast speed.

2. Derivatives and Collateral Management:

Avalanche Layer 1 solves critical challenges for derivatives trading and collateral management by enabling high-speed, low-cost transactions essential for timely execution and settlement. Its multi-collateral support allows traders to use various assets as collateral, improving flexibility and risk management. Avalanche’s native multi-chain architecture optimizes transaction processing, enabling efficient leverage trading, hedging, and position management. Here’s how Blocktcity is achieving benefits from Avalanche L1:

• Blockticity

Blockticity, the blockchain platform for securing global trade operations and documents has officially launched a Layer-1 chain powered by Avalanche. By doing this, Blockticity achieves a major milestone of migrating 45K+ COAs (Certificates of Authenticity) to its dedicated Avalanche-powered chain integrated with compliance. All these digital certificates contribute to 1.2B+ in authenticated, real-world goods.

Blockticity L1 has been serving as a powerful verification layer for the protocol as it ensures documents are AI-verifiable, standards-aligned, and tamper-evident.  The L1 has 776.53K + total transactions and it offers quick transaction processing with 0.011 TPS. Also, Blockticity’s integration with LayerZero has enabled a highly composable infra for AI-native authentication of trades.

3.Loyalty & User Engagement:

Loyalty and user engagement solutions are another DeFi use  case that get impacted from issues like fragmented loyalty ecosystems, lack of transparency, limited interoperability, and inefficient reward distribution. Avalanche Layer 1 addresses these by enabling secure, scalable, and cost-efficient blockchain infrastructure that empowers brands to tokenize loyalty points and customer data. Here’s how QChain is doing this:

• QChain (by Quboid)

Quboid, the full-stack platform for loyalty, rewards, and automated campaigns has built its dedicated Layer1 for loyalty ecosystems. Powered by sovereign architecture, scalability, and speed,

QChain is designed to offer a gasless experience so that users can engage in the network without getting bothered to pay transaction fees. With Avalanche L1, the chain offers a lightning-fast, secure, and efficient TPS experience with 0.05TPS,  7.70M+ transactions, 19K+ transactions.

Plus, the sovereign chain gives Quboid the full autonomy to unlock greater potential to accelerate innovation for their business.

4. Prediction Market:

Prediction Market is a highly sensitive and volatile finance niche, where security and compliance is of utmost importance. Avalanche Layer 1 supports prediction markets by providing a high-throughput, low-latency, and cost-efficient blockchain infrastructure that ensures fast transaction finality and smooth user experience. Its scalability allows platforms to handle millions of daily on-chain transactions without congestion or high fees, critical for real-time forecasting.

• TradeXMarkets

TradeXMarkets, the leading platform designed for prediction and trading, has launched their custom prediction market on a custom chain built as Avalanche L1. TradeXMarkets utilizes this network to process its 50K+ daily on-chain transactions and it has total 2.29M+ transactions to date.

“Prediction markets have long been an untapped segment in decentralized finance (DeFi), and TradeX Markets is here to change that,” said Indrajeet Roy, Co-founder of TradeX Markets. “With a custom-built Avalanche L1, we’re providing users with a seamless, trustless experience, empowering them to forecast events with unparalleled speed and efficiency.”

Following are the key reasons that encouraged TradeXMarkets team to choose Avalanche L1:

• Quick launch and effortless management of the L1 chain through Avacloud.

• Ability to handle heavy daily transaction load (50K+).

• Instant execution and faster settlements.

• Ultra- low fee to offer fair participation for users.

• Greater scalability even during high network congestion.

• Enhanced security & compliance through customization.

If you want to launch your purpose built Avalanche l1 chain, you need the support of experts. And that’s where Zeeve’s role comes into fruition;

Planning Avalanche L1 for your finance project? Do it with Zeeve

Zeeve has a proven track record for successful launch of 15 + Avalanche L1s on its own managed infrastructure. These chains are from major industries, including DeFi, Gaming, AI, healthcare, general-purpose, and more. So, if you are planning to build your own purpose-built Avalanche L1 for finance, Zeeve can help, from rapid node & network setup to RPC configurations to validator node settings, integrations, and more.

For customization, Zeeve offers overc integration partners that we bring on Zeeve. Also, your L1 will be continuously monitored on an intuitive dashboard 24/7 to ensure performance and maintenance.

So, if you have any specific requirements that you want to integrate with your Avalanche L1 node, you can readily use them. Moreover, Cogitus will further amplify the development experience. Planning to set-up your next Avalanche L1 node, why wait? Write to us your requirements or set up a one-on-one call with our experts, where we can provide you with an Avalanche L1 demo.

PandaSea was born out of a simple provocation:  what if sports weren’t a dead-end gamble, but an investable asset class? What if every match, every performance, every league table shift could be financialized as a tradable position, liquid, transparent, and yielding value back to the community that powers it?

Today, that idea ships to production. PandaSea’s Avalanche L1 mainnet, deployed with Cogitus by Zeeve, is live, and with it comes TheSportExchange (TSE) — the first marketplace that turns live sports into a yield-generating economy.

The Problem: The Extractive Game of Sports Betting

The global sports wagering market is built on an extractive model. It thrives on opaque odds and high fees, locking fans into a cycle of short-term speculation with no possibility of building lasting value. Fan participation is reduced to a simple win-or-lose transaction, while the real financial upside is captured by intermediaries.

Meanwhile, DeFi has built immense liquidity machines, but almost none tied to cultural passion points like sports.

This mismatch created a vacuum,

• For Sports Fans: a global passion economy with no lasting instruments of ownership

• For the Crypto Ecosystem: a DeFi stack searching for relatable, real-world markets.

PandaSea was born from the realization that this model was not just inefficient; it was fundamentally unfair. The team set out to reimagine the structure from the ground up, using DeFi mechanics to convert fleeting bets into ownable, tradable assets that reward fans for their knowledge and loyalty.

What PandaSea Does Differently?

PandaSea reimagines sports not as wagers, but as programmable markets. At the center is TheSportExchange, where fans buy blockchain-based “keys” tied to real teams. These keys don’t expire at the whistle. They sit on bonding curves that guarantee liquidity, appreciate when demand rises, and accrue bonus yield from league-specific pools funded by platform turnover.

Every transaction flows through PANDA, the chain’s native token. Each trade, each key, each bonus payout contributes to automated PANDA buybacks, creating deflationary pressure directly linked to usage. Through a Hyperliquid-style mechanism, 0.56% of every transaction is directed into daily PANDA buybacks to ensure continuous, organic demand tied directly to platform activity.

The idea is bigger than sports, though. PandaSea’s architecture supports DeFi Liquidity Vaults (DLVs), programmable vaults that tokenize exposure to real-world assets like gold, energy capacity, social reputation, and make them liquid, yield-bearing, and redeemable. Sports is simply the first, most intuitive proof point. If it works where passion is highest, it can scale everywhere.

This new model creates a powerful economic flywheel:

• Own a piece of every action

• Earn real yield

• A self-sustaining economy

And the traction is already there. TheSportExchange is fully built and live with USDp, a collateralized stablecoin for transactions. Premier League and La Liga promotions are lined up. Airdrops have seeded more than 100 million PANDA into communities.

debut publicly with a gamified airdrop and $2 million presale campaign.

“We believe that value creation should equal value participation. Traditional sports markets extract value from fans, while we empower them to own it. This mainnet launch is the first step in a larger mission to build programmable, decentralized markets for all forms of real-world value.”

Stephen van Zutphen

Why Avalanche L1 Was the Only Choice?

To build a financial market for sports, you need infrastructure that can handle the pace of the game. High-frequency microtransactions, real-time price updates, and instant settlement aren’t optional—they’re essential. PandaSea needed a blockchain that delivered raw throughput without sacrificing decentralization or control.

Avalanche L1 provided the perfect foundation. Building a sovereign Layer 1 gave PandaSea its own economic zone with:

• Dedicated Throughput: Sub-second finality and low-cost micro transactions capable of supporting a high-volume consumer marketplace.

• Custom Economics: The ability to use the native PANDA token for gas fees, creating a closed-loop economy where all activity reinforces the core ecosystem.

• Full Sovereignty: The independence to build custom DeFi primitives like bonding-curve market makers and DAO governance directly into the chain level, without being constrained by a shared network.

PandaSea wanted to mirror the real-time intensity of live matches. It needed its own dedicated chain, and Avalanche provided the performance, security, and customizability to make it a reality.

What Cogitus by Zeeve Delivered?

Launching a new financial market requires more than a vision; it demands utility-grade infrastructure with zero tolerance for failure. PandaSea needed a partner who could translate their ambitious design into a production-ready, globally scalable L1. That’s where Cogitus by Zeeve came in.

Zeeve managed the end-to-end deployment and now runs the full infrastructure stack for the PandaSea Chain, ensuring it operates under pressure with institutional-grade reliability

Zeeve’s role included:

• End-to-end Avalanche L1 deployment, optimized for high-frequency marketplace flows

• Dedicated, low-latency RPC endpoints for TheSportExchange and partners

• 24×7 automated monitoring with enterprise-grade SLAs

• TraceHawk Explorer integration for real-time transparency and auditing

• Scalable node orchestration and CI/CD pipelines to upgrade without downtime

• Security architecture aligned with SOC2 and ISO27001 standards

With Zeeve managing the complexities of the underlying infrastructure, the PandaSea team

can focus on what they do best: building the future of real-world asset markets.

“Launching a new asset class demands an enterprise-grade foundation of trust and reliability. We engineered every component of PandaSea’s L1 for the speed, data integrity, and uptime needed to power a real-time, global sports economy. This is the kind of mission-critical infrastructure Cogitus was built to deliver.“

Dr. Ravi Chamria, Co-founder & CEO, Zeeve

Sports Was Only the Beginning!

With the core infrastructure now live, PandaSea is rolling out user-created investment pools and gamified experiences to onboard millions of mainstream fans. The roadmap extends far beyond sports, with plans to launch programmable markets for gold, energy, and social influence.

TheSportExchange is already in invite-only pre-buying mode, with public launch coming in October. The first 1000 participants can claim early access using this exclusive link.

For builders, PandaSea’s launch is proof that real economies can move on-chain when the right stack and the right infrastructure partner align. If you’re ready to transform your industry into a programmable market, Cogitus by Zeeve has already made it possible.

Talk to Zeeve. Your Avalanche L1 could be next!

But the process to revolutionize these two sectors is easier said than done. In this article, we shall see problems these two sectors are facing and how ZK proofs for Digital IDs and payments can make a difference here.

What are ZK Proofs and How Do They Work?

ZK proofs are a scalable method of proving the validity of anything without revealing anything other than the validity statement. Through the use of ZK proofs for payments and Digital IDs, it is possible to let new use-cases which are impossible on blockchains to make way and let adoption drive the future of Web 3 as demonstrated through this image shared below.

If you want to learn more about how they work and other details, you can read What are zero knowledge proofs and why are they important for blockchain here.

Problems  In Identity Management and Payments They Can Solve For Traditional Systems

In Identity Management

What are the problems in identity management that traditional systems cannot solve as of now :

1.High Cost

Identity management while using the old methods are quite costly for any economy. . For example, in the United States, the government has to incur the following;

• For Social Security Cards & Administration (SSA): $14.227 billion

• Passports: $5.1B

• Driver’s Licenses: $964.55 million

• Cybersecurity & Data Protection: $60.4 billion

• Enforcement & Compliance: $60.4 billion

Collectively the amount totals to  $141.092 billion annually which the US government has been spending to safeguard the citizens. Now, this can be easily resolved through onchain IDs because not every department has to keep a copy of the same. But the problem with this approach is that not every government body would be interested in sharing the data with others due to multiple interoperable, security and sovereignty challenges.

Identification/ Discoverability

When you are keeping all the data at a single point, it is very easy to discover and compromise the same. For example, in the year 2024, there have been more than 228,282 government imposter scams that have happened in the United States. Due to these scams, the government almost lost $126.5 million**.** When the authorities investigated the matter, it was found that this is happening because data breaches have exposed many SSNs. The crazy part was that everything was coming from a single source: Equifax. Had there been a way to mask the identity of the servers or scatter the data across multiple checkpoints or owing the data in self hosted IPFS, such a thing wouldn’t have happened in the first place.

Limited Federal-State Coordination

Federal and state relations in many economies is a real challenge when states are not ready to co-operate with the government in handling details of their citizens. For example, the Kate (Kathryn) Steinle case is a prime example to put here. In the year 2015 in San Francisco, Kate (Kathryn) Steinle was shot dead by a detainer named José Inez García Zárate . This primarily happened because of lag in data sharing where one of the departments recorded his details as 45 years  and another data showed he was in jail with the ID carrying his age to be 52 years.

Due to these discrepancies, he was allowed to walk free. A proper synchronization between state and federal would have averted this but due to autonomy, no state wants to let the federal government take control because it would lead to an attack on federalism and compromising the sovereignty of the state.

In Payments

Like the  on-chain IDs sector, the payment sectors  are also not free from  roadblock while using the existing systems in the form of ;

Overcoming the Problems in Illicit/ Terror Financing

At present, if the policy makers and the market regulators want to monitor the illicit activities happening due to the use of dollars, it is very hard to track the same when they are using dollars in cash form or the transactions are happening outside the jurisdiction of the United States. Blockchain can have a crucial role to play here because they are not confined by a specific jurisdiction, but due to their over-transparent nature, the authorities find it hard to integrate blockchains in their payment systems to completely resolve this problem.

Inefficiency In Tacking  State-level Money Transmitter Laws

In the US, there are many states which are allowing banks and other financial institutions to service digital assets for undertaking payments and other details. For that matter, the regulators are setting up many state financial services agencies to keep an eye on irregularities or any other unlawful activities that these banking institutions are conducting while servicing digital assets. And in the process, these institutions have to procure the license for the same.

But in some states, the laws might not be there to keep an  eye on such activities. And if new laws are proposed and passed to tackle inefficiencies, they might take months and excessive investment to enforce and integrate with the existing system for such banks and financial institutions. For example, when the New York State Department of Financial Services created a law for the same, it led to uncertainty for those applying for the licensing because the process was very complex, extensive and costly when mixing traditional systems with on-chain monitoring and management.

Inability To Make Real Assets Highly Liquid For Payments

At the moment, the traditional financial systems are not aligned to bring many assets onchain like gold, bonds and other for near instant gratification. This is happening because there’s no way out where traditional systems can overcome their old bottlenecks in making multiple asset kinds more liquid without diluting compliance in the process to meet loopholes in their treasury.

The need of a traditional system is to ensure that tokenization can turn compliant, verifiable and secure which can drive in a lot of liquidity but the process would demand interoperable collateral pools, instantaneous atomic settlements, unified market and programmable transactions. Now, if this has to happen, the traditional systems must be designed in such a manner where it is futuristic and compliant at the same time.

How is ZKsync Planning To Resolve the Same?

ZKsync has made a giant leap in resolving the same through the use of blockchain technology. So far, government authorities refrained from using blockchain technology due to its fundamental flaws where everything is public and open to all. But ZKsync Elastic Chains have ended as an amenable solution and the latest products of ZKsync Quark IDs and Prividum are solving some of the innate problems in ID management and payments to emerge as a gold standard. Have a look at the solutions they have provided to help some of the emerging use-cases to receive mainstream adoption.

Quark IDs

QuarkIDs are solving the innate problem of interoperability, data silos and standardization because right at this moment, there’s no means to standardize ID verification cross chain across different blockchain protocols. Due to this, though we may say that ideally one should evolve from the Web 2→ Web 3 world, the problem of fragmentation, and data silos remain the same with the Web 3 world.

With the Quark IDs, this problem is getting resolved from the grounds up due to the use of ZK proofs which can standardize the verification system for quicker adaptability. The efficiency of delivering on-demand, market ready solutions for standardizing On chain ID has been such by Quarks that Buenos Aires has already integrated this in their system making  3.6 million IDs move on chain with interoperability and cross-border operations without government intervention.

Prividum

Prividum is another solution proposed by ZKsync to take payments to the next level of adoption because right now there’s a lot of challenge when you are going for payments onchain like compliance, access controls using  blockchains, quickly bringing RWAs onchain . But with the help of the ZKsync Prividum, which is using ZK-proofs for payments and settlements, all these problems are getting resolved. Moreover, Prividum also provides some of the advanced features like:

• Access Control: Allowing regulators to view, analyze and even censor every payment happening on-chain despite using blockchains.

• Private RPC: ensuring that while pushing for compliance, you do not end up making everything public through Private RPC points assigned to only authorized entities for access

• Private Blockchain Explorer: Not allowing anyone to see any data like payments and settlements coming to and from different accounts

• Ethereum Security: Ethereum is the gold standard in security and when enterprises or banks are trusting a payment system to either upgrade or replace their legacy system, they want assurance that it would be battle tested. ZK proofs for payments allow all Priviodium transactions to be settled on Ethereum using ZK-Tech.  This allows any application hosted on top of the Prividum chain for payments to inherit almost Ethereum equivalent security.

These trade offs are such that governments and institutions can also now use blockchains without drawbacks. At the moment, Deutsche Bank has already used ZKsync Prividium to deploy project DAMA in association with the Memeto Blockchain and Zeeve playing a pivotal role in setting up the infrastructure for the project. The Trump administration wants to  scrap the Biden Administration Operation ChokePoint to make the US the crypto hub of the world. In this pursuit, they have acknowledged the efficacy of ZK-Proofs in making the difference.

With ZKsync being the  front runner in this ZK Proofs so far and their battle tested market presence, if you want to build  something around on-chain IDs and revolutionizing payments, this could be a stack due to its Elastic Chain(s)interface where you do not just get one ZK ecosystem but access to all the ecosystem using ZK proofs as the tech to interoperate, share liquidity and function.  Zeeve has helped many projects in integrating  ZK-Tech with Dama for the Memento blockchain being the latest. You can read the use-case here to understand Zeeve’s contribution in this transformation. If you want to undertake digital transformation, Zeeve can help you.

Build Your ZKsync  Chain for On-Chain ID or Payments Network  with Zeeve

Zeeve has a battle tested track record of deploying your own purpose built ZKSync chain using ZK proofs for payments and digital IDs.  So far, Zeeve has been instrumental in helping some of the big names like Memento, Syscoin’s zkSYS, and many others to launch their ZK chains using the ZK Proofs as an underlying validation technology. If you want to build your own application to support on-chain ID management or streamline payments systems, Zeeve, by harnessing more than 40+ integration partners can help you in this pursuit. To take this forward and launch your ZKsync using ZK-Proofs for payments and digital IDs., our experts are just a click away to help you in all possible ways.

Hard to say because there’s no black and white while choosing a technology stack, because no stack is like a silver bullet solving all the problems.  In this blog, we shall find where you should go as a project owner by mapping a comparison war between : Avalanche L1s vs   layer 2 rollups.

But before we do that, let’s start from the very beginning;

A Recap of Avalanche L1s and L2 Rollups

Avalanche L1s are sovereign blockchains with their own defining rules regarding operations like deciding the tokenomics, membership of validators, and other custom specifications. That being said, if you want your application to match with near instant settlements, Avalanche L1s are perfect. But in case you are wondering that having to decide tokenomics, validator sets, and customization would make all L1s on Avalanche as separate islands, such is not the case due to Avalanche Warp Messaging.

Layer 2 Rollups, on the other hand,  are like a second layer to blockchain, which is responsible for addressing the scalability barrier of Layer 1s only and you also have to deal with some limitations while using a rollup like bridging complexities, dual fees and security dependency. So, how do you decide which way to go while going on a stack war with Avalanche L1s vs Layer 2 Rollups? Let’s find that out below by looking at few of the parameters;

Key Factors To Consider When Deciding To Choose Avalanche L1 vs a Layer2 Rollup

1.Flexibility / Sovereignty

When considering a blockchain to build your solution on top of it, if you are looking forward to;

• The ability to setup a  custom VM

• Decide your own gas token

• Set up validator level control

• Define custom governance logic

• Setup open participation

These are certain things that you cannot get while using a rollup because they are tied to their supportive  L1s chain for security, operations and  governance. But despite the limitations, if you still want to deploy on top of a  rollup and build from the very scratch, it would demand: (i) incurring the building cost (ii) taking security responsibility (iii) bootstrapping trust (iv) managing interop challenges (v) dealing with liquidity fragmentation and (vi) complying with regulatory scrutiny

But this is where Avalanche L1s abstract all of these  because these L1s   support custom VM logic, gas token optimization, and open participation at the protocol level, no additional build up needed. Due to this, applications launching on top of Avalanche L1s are getting flexibility on their own terms without having to face any chain limitations;

2.Transaction Fees

Transaction fees are the make or break element while  choosing a technology stack. For example, suppose  you are doing a 100$ swap across protocol and for the same, you have to pay $5 dollars in fees. Now, to skip these odds, layer 2s were created to help you bundle transactions on top of a rollup and pay almost negligible fees for the same. But in the process, while  using a layer 2, they exposed a few key bottlenecks/barriers;

• Interop

• Liquidity fragmentation

• High fees for settlements / if Layer 1 is clogged or going through extreme network activity as shown from the image below.

But Avalanche L1s have resolved this through a series of upgrades. For example,  ACP-125 upgrade has made structural adjustments that have significantly reduced the Avalanche transaction fee in 2025. And due to this upgrade, more than 80% of transactions are operating near the base fees on the Avalanche L1 as shown in the chart below. How is such a lower fee reduction happening? Because these L1s are using the C-chain for public data and a reduction of fees on C-chain has concurrently reduced the fees on the Avalanche L1s by as high as 96 with fragmenting liquidity or interoperability.

As a result of this, layer 2s which were known for providing the lowest fees could only compete with  Avalanche L1s and not outsmart it as shown in the table below;

3.Time to Finality

Often the rhetoric revolves around having those magical numbers like 5,000 TPS, 10,000 TPs or at maximum 50,000 TPS on your blockchain. But TPS is incomplete with TTF or Time To Finality. Why?  Because you might have 50,000 TPS, but if the latency is very high, it would delete a lot of use-cases from existence. Now, with rollups, there’s a 2-3 second window for soft finality and 10 minutes for a hard finality, which means, you get the assurance that your transaction is through. That being said, suppose you need very low latency like micro-seconds for finality, rollups might not be suitable for the same for hosting use cases like;

• Cross-chain Swaps or Bridging

• Real-time Games / On-chain Gaming

• High-frequency Trading / DeFi Arbitrage

• Tokenized Real-World Assets (RWA)

But with Avalanche L1s, it is possible to achieve sub second finality  with the time span of less than <1s required for the above use-cases. As per the Messari Report , so far Avalanche has outsmarted most of the blockchains in clocking  TTF to give rise to advanced use-cases to be built on top of it.

4. Unlimited Scalability

With new advanced narratives dominating the crypto space like RWAs, DePin, DeFi, Clob models and more, the desire for scaling has been a tipping point of discussion in the Web 3 space. But at present, when you are building on top of a rollup for meeting unlimited scaling, there are multiple fronts on which rollups need to evolve  like;

• Complexity in managing overheads, maintenance, monitoring and inter rollup communication for horizontal scaling

• Load balancing and latency bottlenecks

• Data synchronization and mitigating security vulnerabilities

• Optimizing cost of operations.

Avalanche L1s   utilizes the subnet architecture to abstract load across multiple blockchains to overall amplify the network capacity for meeting near hyper scalability. So, due to this set-up, despite the influx of activity on its chain, it is possible to delegate  tasks to different blockchains to meet the speed without bloating the primary blockchain in the process.

Avalanche isn’t just scaling… it’s multiplying!!!Have you ever wondered why apps on @avax don’t fight for blockspace?It's because Avalanche doesn’t scale up it scales out.Let’s break down how the C-Chain + custom L1s + cross-chain messaging combo unlocks serious firepower.… pic.twitter.com/GkvY3gR3mU

— Horlu.btc (@Horlu8) July 31, 2025

Now, it is not like layer 2 rollups are bad after reading this far, and Avalanche L1 is a magic bullet, because it is not wise to look at things from a black and white perspective. Rather every stack has a different purpose to serve because there are apps which might be okay with partial customization or they don’t need very low fees or super quick TTF.

In its place, they want robust security of a growing ecosystem like Ethereum and its network effects. For such projects, there’s no better choice than a Layer 2 rollup. But if you have a different requirement where you want to launch a CLOB based DEX, or super scalable gaming application where you need instant finality, unlimited scalability, simple interop and absolute custom specs, Avalanche l1s could be a right pick here. And if you have such a requirement and you want a reliable partner to help you launch your application, Zeeve can be a reliable choice.

Build Your Avalanche L1 Chain with Zeeve

Zeeve takes pride in providing the best blockchain ecosystem  critical for the success of any project. By using the  core analysis of Avalanche L1s (Formerly known as Subnets) vs Layer-2 solutions, Zeeve can help you in choosing the blockchain that can best fit into your requirement. We  Zeeve offers all the things needed for seamless launch of L1s (Formerly known as Subnets) and L2s, such as scalable nodes, white-labeled explorers, testnet faucets, data indexers, and plug-n-pay development tools.

In addition to this, our services include security and reliability with ISO 27001 and SOC 2 Type 2 compliance and enterprise-level SLA. For more information on how Zeeve is simplifying the launch of L1s(Formerly known as Subnets), Rollups, appchains, and all the other layer-2 scaling solutions, connect with us. Drop us your queries via email or schedule a one-to-one call for detailed discussion.

Major financial players are launching their own sovereign L1s by choosing the Cosmos Stack. The recently announced Arc by Circle, which is a purpose-built L1 for stablecoin native finance, has a clear Cosmos lineage. Lombard Finance, Stable, Ondo, Provenance, Mantra, Noble, Coreum, Plume, Nillion, and a dozen more are building on Cosmos SDK for RWA Tokenization.

But what’s making Cosmos SDK the top choice for RWA projects is making them jump to this stack. In order to understand that, you need to first understand the top problems plaguing the RWA space and what Cosmos SDK has done to solve these from the ground up.

The Biggest Challenges of RWA Projects Below are some of the critical challenges in RWA that hinder its overall growth and adoption for businesses:

• Limited Customization at compliance level: What’s needed is programmable compliance—the ability to encode jurisdiction-specific rules, KYC/AML checks, and governance frameworks directly at the protocol layer. Without this, platforms cannot provide the confidence and real-time auditability that regulated institutions demand.

• Pervasive Security & Bridge Risks: While generic security concerns like private key manipulation and all do exist, the single most critical vulnerability for RWAs has been cross-chain bridges. The conventional “lock, mint, & burn” model used by third-party bridges creates systemic risks. As per research, RWA protocol exploits have reached $14.6M in H1 2025 alone. These bridges often rely on small, trusted multisigs, creating a centralized point of failure for assets that are supposed to be on a decentralized ledger.

• Inflexible Validator Setup: Be it a permissioned, permissionless, or hybrid RWA chain, the network must be given flexibility to set up validators as per their real-time transaction load. Or else, the platform will end up incurring high operational costs while also keeping security at stake.

• Inefficiency in Tracking & Management: Without rich on-chain metadata capabilities, proving the link between a digital token and its underlying real-world asset becomes opaque. This increases the risk of fraud and makes auditing incredibly difficult. Ineffective tracking makes it very much difficult to prove the actual ownership of a token, leading to disputes among the holders of the asset.

• Fragmenting Liquidity: When an RWA is tokenized on a single chain, its liquidity is trapped. While bridges exist, they create fragmented versions of the same asset (e.g., bridgeUSDC vs. nativeUSDC), increasing risk and complexity for users. Fragmented ecosystems without powerful communication protocols cause asset lockups, trading delays, and reduced economic efficiency.

• The EVM Incompatibility Dilemma Most of the existing DeFi liquidity, developer tooling, and user base reside within the EVM ecosystem. RWA projects face a difficult choice: build on an EVM chain and sacrifice sovereignty and customizability, or build a custom chain and risk being isolated from this critical ecosystem. Both impact the liquidity and usability of tokenized assets.

• Volatile Transaction Fees Volatile or high transaction fees create a barrier to entry for institutional investors and key players in the RWA ecosystem. High, unpredictable fees make frequent trading, rebalancing, and settlement of tokenized assets economically unviable, hence impacting the widespread adoption.

• Complex User Experience Delayed transactions, the need to acquire and hold a separate volatile gas token, failed checkout, and lack of interoperability – all these appchain-level issues, when combined with a confusing UI, discourage users from joining the RWA network, which is a serious issue.

How does Cosmos SDK solve these problems?

Enough of the problems. Let’s now move on to the solutions that Cosmos already offers for RWA projects.  Cosmos SDK is powered by capabilities that are highly suitable for customized RWA chains. All the problems that we discussed in the above section have already been tackled by Cosmos SDK.

Let’s understand these solutions and also validate the claims through the Cosmos SDK RWA chains utilizing them:

1.Extended customization with  v0.53.0 to match specific compliance needs requirements:

Given that compliance is critical in RWA projects, Cosmos SDK enables extensive customization for network-level permissioning, governance frameworks, and capital flows so that regulatory adherence must be there across jurisdictions. With the release of v0.53.0, builders have greater modularity, the ability to push new features, and seamless legacy upgrades.

Also, recent updates across the stack also bring ABCI 2.0 compatibility (vote extensions, mempool optimizations) and stronger IBC improvements— from v8 to v2. This is useful for asset issuers who need send-restriction hooks and for appchain devs who want cleaner connectivity and upgradability.

Cosmos SDK already supports robust on-chain governance, where native token holders can vote and propose changes through a one-to-one voting system. Capital flows can also be tightly managed using the SDK’s core modules—bank, authz, group, feegrant, governance, and custom middleware—to codify programmable compliance such as role-based transfers, jurisdictional allowlists, asset freeze/unfreeze rules, and real-time reporting.

All the leading RWA chains, including Mantra, Provenance, Noble, Ondo Chain, have been utilizing the customization benefit of Cosmos SDK to maintain compliance for their network.

2. Aggregated Liquidity through cross-L1 Interoperability:

RWA chains in the Cosmos ecosystem benefit from unified liquidity through the IBC-enabled cross-chain connectivity. That means assets issued on any RWA tokenization chain can seamlessly and securely flow across 100+ IBC-enabled chains. Hence, users will be able to access the assets and tokens all across these chains.

Similar to compliance, aggregated liquidity and cross-chain interactions is the reason for all the RWA chains to opt for Cosmos.

Here’s what Coreum says:

IBC has evolved a lot, too. IBC v2, launched in March 2025, simplifies the protocol, removes complex handshakes, and uses ZK-enabled verification to lower the cost of connecting to expensive execution environments like Ethereum. The Solana integration is also on the roadmap.

The roadmap also includes IBC Attestations, a solution designed to connect with optimistic rollups and other chains that lack light clients. This will ensure the Cosmos ecosystem remains connected to the entire Web3 stack.

Let’s take the example of Novastro. It’s an RWAFi project that enables seamless RWA custody and liquidity by bridging assets from Ethereum via Axelar or Gravity Bridge, routing them through Osmosis AMMs for low-fee swaps, and using CosmWasm smart contracts to integrate oracle feeds, compliance controls, and asset logic.

This kind of complex bridging flow with borderless liquidity and policy control is possible only in Cosmos SDK. And that’s a reusable pattern.

3.Solving the EVM Dilemma:

​Founders no longer have to choose between the Cosmos stack and the EVM ecosystem. Chains built with the Cosmos SDK can be fully EVM-compatible.

Let’s take MANTRA Chain for example. They are the “first purpose-built RWA chain that is both EVM-compatible and self-sovereign,” and allow developers to deploy dApps with all the EVM opcodes they know while leveraging MANTRA’s unique compliance infrastructure.

Realio Network, another L1 ecosystem for RWAs, has also gained EVM compatibility by integrating evmOS.

4. Strong security guarantees-

Sovereign, application-specific RWA chains built with Cosmos SDK will have strong security enabled through CometBFT and the Inter-Blockchain Communication (IBC) protocol.

Further, to solve critical security issues like bridging attacks, Cosmos is launching The Gravity Bridge where the bridge needs the validator set to be updated on the Ethereum smart contract by calling the ‘updateValset’ method at least once within each unbounding period, typically every 14-days period.

Read more about the bridge, its mechanism and value addition to Cosmos SDK here.

And, to take this security another level, Cosmos SDK has introduced specific security implications for chain builders where they get to implement ABCI++,  Object-Capability Model (Ocap),  AnteHandler, Chain  Ecosystem Interdependencies and Inherited Risk. These features give developers more granular control over how security is enforced at the protocol level.

Today, many Cosmos RWA chains pair CometBFT finality with IBC Classic → IBC v2 migration paths. It ensures they can scale their security model as interchain connectivity expands. For ecosystems that don’t run Cosmos-style light clients, such as Base, Arbitrum, or Solana, Cosmos is enabling attestation-based IBC clients and conditional clients as mentioned above. These approaches combine data-availability proofs with rollup-state attestations, offering multiple verification models. The result is a flexible balance between speed and security, ensuring that institutional RWA flows can operate with confidence while keeping user experience smooth.

5. Faster time-to-cash:

RWA tokenization chains built with Cosmos SDK benefit from faster time-to-cash, driven by the CometBFT consensus engine and recent performance upgrades.

By design, Cosmos chains are account-based, and with ABCI 2.0 which includes optimized mempools and vote extensions, they deliver lower latency and higher throughput.

For institutions, this translates directly into quicker issuance, redemption, and secondary trading, alongside uninterrupted 24/7 global market access.

The most powerful example of this is Figure Technology, which built the Provenance blockchain using the Cosmos Stack.

• ​Figure has become the largest non-bank HELOC lender in the US, processing over 200,000 loans.

• ​By using Digital Asset Registration Technology (DART) on-chain instead of legacy systems, they offer loan approvals in minutes.

In its public filing, Figure reported $191 million in revenue and $29 million in profit for the first half of 2025. This demonstrates the immense efficiency gains of a purpose-built blockchain.

Another example could be Ondo.

Ondo Finance, with over $1.39B TVL, built Ondo Chain to access faster settlement and programmable compliance for tokenized U.S. Treasuries and lending platforms.

• Its Ondo GM platform ties tokenized assets directly to public exchange liquidity, enabling instant redemptions and preventing the dislocations seen in early tokenized equities.

• In 2025, Ondo moved ~$95M OUSG collateral into BlackRock’s BUIDL, allowing 24/7 redemptions compared to the traditional T+2 settlement cycle, and is now rolling out tokenized ETF access through its Cosmos-based stack.

These examples highlight how Cosmos SDK’s consensus and execution model enable institutional-grade settlement speed, and position RWA chains to operate at the pace of modern capital markets.

6. Custom validator setup:

Cosmos SDK chains to overcome static or rigid validator setup where on-chain governance allows the chain to include a certain number of validators (depending on the project) to bootstrap your AppChain network and allow it to validate the transactions on the network. With ecosystem expansion, the network must allow more validators to participate in the consensus and help AppChain to ensure security.

Here’s Provenance reiterating the same thesis

Take Ondo, as another example again. They choose to build on Cosmos precisely for this reason. They have permissioned validator sets, with staking secured by tokenized RWAs rather than volatile crypto assets. This design lets Ondo align with institutional risk management standards, reduce exposure to risks like front-running, and enforce compliance measures directly at the protocol layer. Gas fees on Ondo Chain can also be paid using tokenized assets. This further reduces volatility and aligns with the expectations of financial institutions.

7. Impressive UX for accelerated adoption:

Since the start, Cosmos SDK has been a lot focused on improving the UX. The support for native USD issuance and multiple innovative features with leap wallet is a solid example for this.

While these components are widely popular across all niches, Noble; the RWA chain that has issued $435.1M assets, has been enabling Issuance of native USD to its 6 Blue-chip issuers.

To make this accessible, Noble integrates directly with the Cosmos specific Leap Wallet, and allows users to onboard and transact with simplified flows, familiar UX patterns, and support for multiple issuers. All without needing to navigate through any kind of technical complexity. This ensures that RWA participation feels as seamless as interacting with familiar fintech products.

8.Specialized modules for Asset Tracking and Token Transparency:

Cosmos SDK offers production-grade modules that RWA chains can use to enable high level systems for metadata management and ownership tracking. With complete transparency, it’s easier for users as well as investors to participate in the network without any confusion or doubt for its sustainability.

Provenance (we already mentioned) that has $42b+ in transactions,  $16.9b+ in active loan TVL,  79% of the private credit market in Web3, and 65+ Network Validators, has employed these Cosmos SDK-powered modules for metadata and ownership tracking. This is critical for loans and mortgage assets and adds trust and transparency to its ecosystem.

Though we’ve highlighted specific Cosmos SDK RWA chains for each feature/RWA solution, the names are not of course not limited to these. Other innovative RWA chains that are building and thriving with this appchain stack includes Neutron, Figure, Swift, Japan, Europe, The U.S., Joltify Finance, Injective, Commercio, Network, Titan, Stargaze (NFTs and social tokens), Chihuahua (community-driven NFTs). Plus, a lot of projects are on its way to launch on the Cosmos ecosystem in 2025 & beyond.

Ready to thrive with your RWA chain? Do it with Zeeve’s AppChain Infra

Now that you have a clear picture about what challenges Cosmos SDK has been tackling and why so many RWA chains have chosen this appchain stack, your next step will probably be to plan your chain. On this step, Zeeve helps RWA projects to deploy and scale it to meet enterprise-grade standards.

As the leading AppChain-as-a-Service provider, Zeeve engineered and deployed both the testnet and mainnet infrastructure for multiple CDK chains—ensuring stability, high availability, and zero-friction onboarding for developers and businesses alike. Here’s a snapshot of what Zeeve Provides:

• Fully managed testnet deployment.

• High-availability infra.

• TraceHawk Explorer integration.

• Future-ready mainnet scaling.

For more information on our services and appchain support, connect with our experts and get a detailed walkthrough.

But getting there requires breaking real barriers: achieving 40,000–100,000 TPS and <100ms blocktimes and logical executions ;  without compromising decentralization.

That’s no small ask for a maturing technology. After all, 40% of U.S. retail equity relies on Centralized Order Book (CLOB) models  that suffer from slow T+2 settlement, no real-time ownership transfer, and throughput without true finality.

What if DeFi could bring CLOBs on-chain and fix all those flaws? Wouldn’t that be a financial game-changer, maybe even a “Make Nasdaq Sweat Again” moment.

Through CLOB-specific L2s built on ZK tech, this will change.

In this blog, we shall explore how these Clob Specific L2s  work and what problems they are going to solve to bring Wall Street performance on-chain and how ZkSync is already winning this race.

What are Clob Based Layer 2 Rollups and How Do They Work?

These are not any specific type of a layer 2, in its stead, simple rollup tech but purpose built to cater to the Centralized Order Book Model demand. For that matter, they operate  offchain to perform custom executions not possible with AMM/ DEX now  like matching buyers, sellers, price, volume on a real time basis using  ZK proofs for near instant settlements and executions. In this way, they make way for even CLOB operations or Centralized Order Book Models highly prevalent on traditional exchanges like Binance and Coinbase to be replicated on top of a DEX. How is this achieved if you may ask? Or put simply,

How do they work?

Through fragmenting every segment as a separate layer  and later on assembling them all together through ZK proof for validation in the following ways to meet the desired outcomes;

(i) The Execution Layer

There is a separate execution layer offchain where all the operations are executed. For example, traders are posting their orders with exact prices and the amount they need.

(ii)The Matching Layer

There’s a matching layer designated with the task to use the matching engine purpose built to follow a FIFO order. Or the first in first out model. Using this model, the orders are matched and it creates a trade history of the order book.

(iii) The Data Layer

The data layer is designated the task to store all the above mentioned data on a separate sector with a self destruct feature to match the speed and efficiency of a traditional clob based model.

(iv) The Settlement Layer

Once all these transactions are injected into the system, arranged accordingly,  matched and executed, the offchain engine creates a ZK-Proof of the same and pushes the same which validates:

• Correct Matching

• Order Book Integrity

• Balance transitions ( No extra or deprived liquidity)

To put that flow in  nutshell, this is how the Clob specific L2 on Zksync  would work;

• Traders are broadcasting the  orders →

• The orders are getting aggregated off-chain →

• Blobs are created to validate for the execution →

• Off-chain Matching Engine: High performance CLOB matches orders instantly →

• ZK  Proof generation triggered after each batch. This off chain  engine creates a ZK proof confirming correct matches, order book accuracy, and proper balances to be posted on the settlement layer →

• On-chain verification follows: Ethereum checks the proof in one transaction, settles balances without trust, and blobs keep all data open for anyone to verify for a short period until destroyed.

When this is done, the Clob specific L2s will ensure users are getting;

• Trades executed at their own preferred prices

• They can access volume

• Sort orders based on price

• Simplified UX

Why Are They Needed and How They Can Suprecharge DeFi ?

Clob Specific L2s are needed  because you cannot let a single concept define the future of a sector. For example, at the moment, the DeFi  has been majorly driven by a few use-cases  like swaps, flash loans, arbitrages, lending and  borrowing due to the technological limitations of the general purpose L2s.  But like it was said in the very beginning of this blog that 40% of U.S. wall street is defined by CLOB and almost the global financial market based on Traffic operates on top of the Clob or Central Limit Order Book model where buyers and sellers are submitting limit orders.   For DeFi to dominate or become the next gen financial model, it must be ready to leap  from  DeFi 1.0 → DeFi 2.0 by mirroring the CLOB model onchain.

But in order to do that, the existing systems must be innovated, engineered, remodelled  to host new use cases extensively in use in TradFi like equity trading, derivatives, ETF arbitrage and more  . Clob Specific L2s  can help do that because they can make room for DeFi for institutional-grade market makers, fully on-Chain spot exchanges CEX-grade UX, derivatives and options markets,  prediction markets & event derivatives protocols to get  hosted  Onchain  by matching the performance of TradFi level CLOB execution but at an onchain level through;

High Performance Execution Layer

If DeFi has to introduce ultra scalable use cases like perps, prediction markets , institutional-grade market makers, fully on-Chain spot exchanges CEX-grade UX, it is important to get single slot or block finality which no general purpose L2 can guarantee because they are dependent on the L1s for settlement. But when you are going for a custom based Clob Specific L2s, they can easily match <200 ms blocktime. In addition to this, there’s also deterministic execution to help eliminate front running on these L2s.

Both of them have different tactical approaches. However, they share the same core traits, which involve Ethereum settlement and data availability.

So where does the difference lie? It lies in their architectural foundation. Optimism strictly aligns with the Ethereum network, using ETH as its gas token. Arbitrum, on the other hand, has a more flexible approach, rooted in chain-specific optimization.

So, in essence, both are innovating, but they take different approaches to custom stack innovation. With Arbitrum, the focus is on fast withdrawals and L3 strategy. However, Optimism’s vision is deeply entrenched in Superchain integration. This has led them to take different paths to evolution.

And when you consider the popularity, among the top 10 Ethereum L2 projects, six use OP Stack. As for the Arbitrum ecosystem, there were over 50 Arbitrum chains in development in 2024, a number that continues to increase. Now the question is: which one is better?

Should one stick to the OP Stack that adheres to the standard Ethereum approach, or choose Arbitrum, an ecosystem trying to establish more freedom thanks to its L3 chains?

A Look into Optimistic Rollup

Before this deep dive, let us get the fundamentals straight. Optimistic rollup is an L2 scaling solution for Ethereum that relies on optimistic assumptions. An optimistic assumption, in this sense, means assuming transactions are valid as long as no one objects to them for 7 days.

For instance, if someone objects to them using fraud proofs, the system is sent into a fault-proof mode. This results in the specific transaction being rerun, followed by result verification. Result matching happens afterward. If fraud in the transaction is proven, the fraudulent transaction batch is rejected, rewarding the challenger and penalizing the one who initiated the transactions.

They are very dissimilar to ZK rollups. In ZK rollups, validity proofs focus on mathematical guarantees, and withdrawal times are instant. Overall, they are faster than optimistic rollups.

Still, optimistic rollups are chosen due to the maturity of the ecosystem, EVM compatibility (ZK rollups are close to becoming compatible too), and fraud proofs, which are less computationally intensive than ZK rollups.

Optimistic rollup is what’s adopted by both Arbitrum Orbit and OP Stack.

What is OP Stack?

OP Stack is a set of software powering Optimism and is geared towards the concept of Superchains, which is a vision to create a shared, open-source ecosystem for L2 blockchains.

Therefore, it can be said that the task of the OP Stack goes far beyond creating an L2 blockchain, meaning it will evolve to provide new use cases.

The current iteration of OP Stack: Optimism Bedrock. Optimism Bedrock provides tools for launching an Optimism rollup blockchain, and the APIs are tightly coupled with this rollup configuration.

Bedrock is another initiative towards developing the Superchain, which is a proposed network of L2s that share a common development stack, communication layer, and security features.

Is there a difference between OP Stack chains and Ethereum? Yes. There are four core differences:

• Bridging: Due to this, deposit transactions exist in L2 but not in L1, and withdrawal transactions prove the L2 rollup to the L1.

• Transaction Fee: Transactions on OP Stack pay for an L1 data fee on top of the standard execution gas fee, and transactions are computed via the EIP-1559 mechanism.

• Mempool Roles: OP Stack does not feature a public mempool. The one it does have is only visible to the sequencer.

Chain Finality: OP Stack contains unsafe, safe, and finalized heads indicating the finality of the L2 block.

Components of OP Stack

Here are the core layers of an OP Stack:

Data Availability Layer

Defines where the raw inputs of a chain based on OP Stack are published. It has a significant impact on the security model, as chain syncing could be impossible if a certain piece of data is not accessible from the data availability layer. Ethereum is a widely used DA module on OP Stack, and it contains Ethereum calldata, events, and EIP-4844 data blobs.

Sequencing Layer

It collects user transactions from the OP Stack chain and publishes them to the data availability layer. Transactions are handled by a single sequencer in a default rollup, which features a dedicated actor with the ability to act as sequencer. The other type of sequencer is the multiple sequencer model, where the sequencer is selected from a predefined set of possible actors.

Derivation Layer

The derivation layer defines how the raw data in the data availability layer is formed before being sent to the execution layer. It uses the current system state and derives Engine API inputs via the rollup module.

The rollup module derives Engine API inputs from Ethereum block data, deposited transaction events, and sequencer transaction batches. Another module is the indexer module, which also derives Engine API inputs, but does so when transactions are sent to, events are emitted by, or storage is modified in specific smart contracts on the data availability layer.

Execution Layer

The execution layer defines the state transition function that mutates the state. The state transitions are triggered when inputs are received from the derivation layer via the Engine API.

Settlement Layer

The settlement layer defines how OP Stack chains are represented on external blockchains. It is read-only, meaning third-party chains can observe and make decisions based on OP Stack’s state but cannot alter it directly. The layer supports attestation-based fault proofs, where specific entities propose a view of the chain’s state. If no one challenges it within the allowed time, the proposal is accepted as valid.

In more advanced configurations, the multisig model is replaced by a permissionless fault-proving process, which shifts trust to the design of the proof system itself. OP Stack also supports validity proof settlement, where mathematical proofs confirm the correctness of the proposed state. This layered approach allows OP Stack to interoperate securely with other ecosystems while supporting both optimistic and cryptographic verification methods.

Governance Layer

The governance layer features a general set of tools and processes to manage upgrades, system configuration, and design decisions. Simply put, it is a relatively abstract layer containing multiple mechanisms that can target the OP Stack chain and third-party chains that impact other layers.

OP Stack Transaction Mechanics

Here is the complete breakdown of the OP Stack transaction mechanics.

OP Stack Transaction Flow

The flow starts with the transaction being written on L1, which is done using OP-Batcher. However, this step can be bypassed, as any user can send an L1 transaction to submit an L2 transaction. During execution, the transaction modifies the state, which is handled by OP-Geth. Once a transaction is written on L1, the OP proposer writes a commitment to post the transaction state on L1.

Writing a Transaction on L1

Writing a transaction requires OP-Batcher, which compresses the transaction into batches and then posts those batches to L1 to ensure integrity and availability. For compression, OP-Batcher aggregates sequencer batches into channels. When the channel is full or times out, it is compressed. Once a channel’s compressed size equals the L1 transaction size, it is considered full. Whether or not it is full is determined by the L1 transaction size and the compression ratio.

State Processing

Once a transaction is written, it is processed in two steps. The first step involves applying transactions from the old state to produce a new state, which OP-Geth handles. And in the second step, the OP proposer then creates a new Merkle root.

OP Stack Transaction Finality

Finality on OP Stack mirrors Ethereum’s progression through unsafe, safe, and finalized states. Once a user submits a transaction, the sequencer includes it in a block and shares it across the P2P network. At this stage, the transaction is still considered unsafe. It becomes safe once the data is posted to Ethereum, either as calldata or blob data. Full finality is reached when the Ethereum block containing the transaction is finalized, which is typically after two epochs, or about 12.8 minutes from the original submission.

OP Stack Fault Proof System

Fault proofs are a core part of OP Stack, letting users freely propose and challenge the L2 chain’s state, especially for proving withdrawals. Introduced on June 10, 2024, this upgrade pushed decentralization forward by removing the need for trusted third parties and enabling L2-to-L1 messaging. It also brought a modular design, making it easier to plug in new proving mechanisms over time. The system runs on three key components that support secure, trustless bridging without any central fallback.

Fault proof program

It runs the rollup state transition to verify an L2 output from L1 inputs and contains both parts of the protocol: op-node and op-geth, in a single process. Its purpose is to retrieve data via the preimage Oracle API.

Fault proof virtual machine

The Fault Proof VM is designed for modularity and composability. It runs independently from the fault proof program, so it’s unaffected by changes in Ethereum’s protocol. When updates happen, the FPP simply imports the new logic.

The VM handles low-level instruction execution with minimal requirements, following a simple read-interpret-execute cycle much like a CPU thread. To support data verification, it interacts with the preimage Oracle through specific system calls, letting programs request hashes and read preimage data in small chunks as needed.

Dispute Game Protocol

The Dispute Game Protocol, powered by Cannon (the default fault-proof machine in OP Stack), functions like a turn-based courtroom where two parties face off. The Challenger believes the submitted state is invalid, while the Defender maintains it is correct. After the sequencer submits a batch of transactions and its resulting state root to Ethereum, a 7-day challenge window opens for anyone to dispute the state.

The process is interactive and progresses in rounds. Through a binary search approach, each party presents the state before and after specific transactions to pinpoint the disagreement. Once the exact disputed step is found, it is executed on Ethereum L1. If fraud is detected, the batch is reverted and the sequencer is penalized. If not, the sequencer is cleared and the Challenger risks losing their bond.

Optimism Superchain

Optimism’s long-term vision is to create a network of interoperable L2 chains known as the Superchain. The tools to create it will have a common infrastructure and common governance, which the OP Stack provides.

All Superchain members use the same core stack (Optimism Bedrock), which enables shared upgrades, coordinated governance, and seamless developer migration across chains.

One of the core use attributes of the Superchain, which is still in development, is cross-chain communication. It means supporting native, trust-minimized messaging between Superchain members without the need for any third-party bridges. Full Superchain interoperability is still under development but remains a core roadmap priority.

In the future, the plans are to implement a shared sequencing system and collective governance model to further the decentralization agenda regarding control over the rollup network.

The chains in the Superchain ecosystem contribute to and benefit from Optimism’s Retroactive Public Goods Funding (RPGF) model — a funding system that rewards contributors after impact is proven.

Among the many emerging ecosystems following this paradigm is Worldcoin. On April 24, 2024, Worldcoin announced its migration to the OP Stack, committing to help scale and support the Superchain ecosystem.

This endorsement, which was helmed by Sam Altman, showcased institutional confidence in OP Stack’s long-term modularity and scalability. Furthermore, this migration signaled real-world adoption.

When it comes to the core components of the Superchain, it integrates Ethereum’s Prague (Pectra) features into the OP Stack for full L1 alignment while embedding withdrawal roots in block headers, improving fault-proof transparency and security.

It also introduces a new operator fee model to support Alt-DA and future ZK rollup modes. Additional improvements include the standardization of the dispute game deployment for chains using permissionless fault proofs.

This upgrade was activated in May 2025 on mainnet, as part of the OP Stack’s 48-hour sync with Ethereum upgrades. What followed was a Superchain withdrawal pause test on May 14.

Additional Perks of the OP Stack

Here are some of the other additional elements of OP Stack:

OP Flashblocks

Flashblocks divide each block into four smaller parts and stream them every 250 ms for near-instant confirmations. As these partial blocks arrive, clients execute them immediately without waiting for full block finalization, which significantly reduces latency. Once all partials are in, the system computes the state root just once and applies it across the full block, enabling efficient live-streamed execution.

OP altDA

OP altDA offers off-chain data availability with on-chain guarantees by letting chains post batch data to alternative DA layers, while only submitting a cryptographic proof to Ethereum. It’s an experimental feature under MTR license, currently for testing and feedback. While cost-effective and compatible with various DA layers, it introduces a new trust layer, relying on operators to correctly post and reference data.

OP Succinct

OP Succinct is a combination of SP1, which is a general-purpose zkVM, and OP Stack. It is designed to upgrade any OP Stack chain within an hour. It features fast finality that is secured by ZKP’s proving latency, which can be completed in tens of minutes. Cost-effective as it reduces transaction costs by a factor of 10, it is considered excellent for rollup teams due to its high level of customization and easy maintainability.

Custom VM Diagnostic Dispute Resolution

This feature from OP Labs is part of the Dispute Game Framework and helps test how modular fraud proofs can work with different virtual machines. It’s mainly a debugging tool that traces how a custom VM reached a disputed state, though it’s not yet used in live dispute resolution. Its goal is to verify if custom VM logic is ready for broader integration into OP Stack’s fault-proof system. Ultimately, it pushes OP Stack toward supporting multi-VM L2 rollups, allowing developers to build ZK or fault-compatible chains that still connect to Optimism’s dispute system.

No Custom Token

One notable trade-off with OP Stack is the lack of support for custom tokens. That is by design, as OP Stack treats itself as neutral public infrastructure rather than a platform tied to any specific token economy. As a result, ETH remains the native token. Still, it stays community-focused through Retroactive Public Goods Funding (RPGF), a model that rewards valuable contributions after the fact and keeps the ecosystem aligned with shared impact over individual incentives.

What is Arbitrum Orbit?

Arbitrum Orbit is a framework for building customizable L2 and L3 chains on the Arbitrum Nitro architecture. It supports sovereign governance, custom gas tokens, and modular data availability. Orbit chains can operate in Rollup mode (settling on Ethereum) or AnyTrust mode (using DA committees for lower cost), and they inherit performance benefits from Nitro.

What are the Components of Arbitrum Orbit?

To better compare OP Stack with Arbitrum Orbit, it is important to visualize it in a similar fashion because that’s how the difference emerges.

Data Availability Layer

With Orbit chains, users have support for multiple DA options. They can choose the Rollup Mode, which publishes transaction data to Ethereum directly using calldata or EIP-4844 blobs. With the AnyTrust mode, users get a system that involves a Data Availability Committee (DAC) that posts only a certificate on-chain, reducing cost.

Finally, third-party DA integration is also allowed on Arbitrum Orbit. Enabled using a pluggable DA interface, Arbitrum Orbit can merge with Celestia, Avail, NEAR, or others.

Sequencing Layer

For this layer, Orbit chains use a sequencer node to order, compress, and broadcast user transactions. It supports soft finality through a real-time sequencer feed and implements elastic block times, meaning blocks are only created when needed. This decreases overhead during low activity.

Derivation Layer

Thanks to being built on Arbitrum Nitro architecture, Orbit chains derive their internal state from transaction batches posted to the DA layer. It inherits Nitro’s parsing, batching, and pre-processing logic to enable smooth transaction handling.

Execution Layer

Within the execution layer, Orbit chains run on Nitro’s WASM-based VM, integrating a modified version of Geth for compatibility.

The EVM+ execution is supported through Stylus, which lets developers write smart contracts in Solidity or Rust.

Settlement Layer

There are two ways for Orbit chains to settle a transaction. The first approach is to settle directly to Ethereum (L2 behavior), or settle to an existing L2 like Arbitrum One or Nova (L3 behavior), which leads to the creation of multi-layered rollup hierarchies.

AnyTrust chains, however, have a different approach, settling using DAC certificates and including fallback mechanisms in case of failure.

Governance Layer

How is Arbitrum Orbit governed? The Orbit chains are fully sovereign and customizable. Developers have the power to define their own governance mechanisms, permissioning systems, upgrade rules, and native fee tokens. There is no underlying DAO—every Orbit chain is its own entity and governs according to its own core rules.

Fraud-Proof and Dispute Resolution

For fault-proof and dispute resolution, Orbit chains inherit interactive fraud-proof mechanisms from Nitro. This streamlined approach resolves disputes by narrowing down to a specific state transition step using a binary search-style challenge process.

Customization and Isolation

Modularity is the core attribute of Orbit chains. They let users choose their own gas token and define throughput limits, privacy features, pre-compiles, and permission settings. This level of modularity enhances the usability factor of Arbitrum Orbit, enabling the design of use cases like DeFi, gaming, NFTs, and app-specific rollups, which could be L2 or L3 chains.

Arbitrum Orbit Transaction Mechanism

Below is the complete transaction flow within Arbitrum Orbit.

User Sends Transaction to Sequencer

Users broadcast transactions to the Orbit chain’s sequencer, which can happen directly or through a frontend dApp. The sequencer then collects transactions into a mempool, prioritizing them based on fees or custom logic.

Sequencer Orders and Batches Transactions

Once the sequencer receives the transactions, it orders, compresses, and batches them into Layer 2 blocks. These batches are formatted according to Arbitrum Nitro’s specification, because the next step is to transfer them to a Nitro Virtual Machine.

Execution by Nitro VM

Once batches are passed to the Nitro VM (WebAssembly-based), each transaction is replayed, applies changes to the L2 state, and ensures validity and consistency using the EVM-compatible engine. Orbit chains can optionally use Stylus to execute contracts written in Rust or C++.

Posting to the Data Availability Layer

After execution, transaction data is posted to the Data Availability layer, which can be Ethereum, a DAC, or third-party DA chains like Celestia or Avail.

State Commitments Posted On-Chain

A state root commitment, which is the post-transaction state, is posted to Ethereum or the parent L2. The commitment includes the block hash, state hash, and accumulator updates.

Fraud-Proof Window

If the fraud-proof window is enabled, then in Rollup mode, state commitments are subject to challenge using interactive fraud proofs. Validators can submit challenges to prove that a given batch or state transition is invalid. If the challenge succeeds, the state is reverted and the sequencer is penalized.

Finalization

After the challenge window expires, which is generally 7 days, and if no disputes are raised, the block and state transitions are considered finalized on Layer 1. In AnyTrust mode, finality depends on DAC quorum and fallback mechanisms.

L3 Variant

If Orbit chains are deployed as an L3 chain, they settle to an L2 like Arbitrum One or Nova, post batches and state commitments to the parent L2 instead of Ethereum, and inherit the L2’s finality and data availability logic.

Arbitrum Fault Proof System

Arbitrum’s fraud proof system is fully built into the Nitro stack, using WASM for efficient execution and a modular setup for flexibility. It follows an optimistic model where all state assertions are treated as valid unless challenged.

Binary Bisection Protocol

Disputes are resolved through a binary bisection process that narrows the disagreement down to a single computation step. This is where the challenger submits a one-step fraud proof directly on-chain, and Ethereum smart contracts handle the verification. Validators must stake collateral to participate. If the challenge is valid, the batch is reverted and the incorrect party is slashed. If not, the assertion stands and the challenger may lose their bond. This structure keeps participation honest and permissionless.

Challenge Window and Finality

Once a validator posts a state assertion to Ethereum, a 7-day challenge window opens. If no challenge is raised or the dispute is resolved, the assertion is finalized. In Rollup mode, this provides full Ethereum-level security. In AnyTrust mode, finality depends on DAC behavior unless recovery mode is triggered.

BoLD Protocol

Introduced in February 2025, BoLD (Bounding Liquidity Delay) made the system fully permissionless and time-bounded. It sets a strict window that involves two challenge periods plus two extra days, around 16 days total, for anyone to submit or contest a claim. With BoLD, fraud proofs are enforced entirely through smart contracts, removing the need for external validators and making the system truly decentralized.

BoLD is now live on mainnet and is a major milestone in Arbitrum’s move toward Stage 2 rollup status. It reinforces the network’s commitment to decentralization, trust minimization, and a fully open dispute resolution process.

Additional Perks of Arbitrum Orbit’s Ecosystem

Arbitrum Stylus

Stylus is Arbitrum’s WebAssembly-based execution environment that runs in parallel with the EVM, enabling developers to write smart contracts in Rust, C, and C++ alongside Solidity. It offers 10–100x cheaper execution by leveraging Nitro’s optimized VM stack and provides greater memory and compute resources, making it ideal for high-performance dApps like AI, games, and simulations. Stylus supports familiar systems programming toolchains and ensures memory safety, strong typing, and smooth integration with existing EVM contracts.

Arbitrum Orbit Rollup Operation Mode

In Rollup mode, Arbitrum chains post all transaction data and state roots directly to Ethereum L1, ensuring maximum security and enabling independent state reconstruction. While this approach provides full trustlessness and censorship resistance through fraud proofs and canonical chain rules, it comes with higher gas costs. Any user can run a node, challenge invalid assertions within a 7-day window, and contribute to validating the chain’s correctness, as seen in Arbitrum One.

Arbitrum AnyTrust Mode

AnyTrust mode reduces costs by posting only lightweight DA certificates to Ethereum, relying on a small Data Availability Committee (DAC) to hold actual data. While this lowers trust assumptions slightly, a fallback mechanism ensures full data recovery by halting the chain and reverting to Rollup-level security if needed. This mode supports faster finality and is best suited for high-volume, lower-security applications like games and social apps, with fraud proofs still available to maintain correctness. Arbitrum Nova operates using this mode.

Arbitrum L3 Chains

Arbitrum L3 chains are blockchains that settle on Arbitrum L2s (like Arbitrum One or Nova) instead of Ethereum directly. As part of the Orbit framework, they inherit Ethereum’s security and L2 performance, forming a layered model: Ethereum acts as L1, Arbitrum One/Nova as L2, and Orbit chains as L3. While structurally similar to L2s, L3s differ by settling and executing through L2 intermediaries, creating security and operational distinctions. Data availability and consensus are still rooted in Ethereum, but L3 chains must route withdrawals through their L2 parent before reaching Ethereum.

Architecture, Tooling & Roadmap

Orbit L3 chains are built on Nitro and support Stylus, allowing developers to use EVM, WASM, and high-performance languages like Rust and C++. These chains are highly customizable. Developers can define gas tokens, governance rules, precompiles, and DA sources (e.g., Ethereum, Celestia). Upcoming features include BoLD support for permissionless dispute resolution, faster exits using validator committees, and new bridging methods for direct Ethereum-to-L3 onboarding, eliminating L2 as a necessary intermediary.

Arbitrum’s Universal Intents Engine

In the first quarter of 2025, a universal intents engine was introduced to enable sub-3-second chain swaps and transfers across chains. Essentially, it allowed users to express outcomes without specifying the execution steps.

This was introduced as a way to bring interoperability for Arbitrum and Ethereum. It has four core attributes. The first one is the message standard, which defines how to encode user intents consistently (e.g., ERC‑7683/7786). Then comes the broadcast standard, which secures contracts for relaying intents across chains. The third perk is fast settlement, which involves using fast withdrawals, bridges, and potentially native ZK proofs. And the final part is the intents dissemination feed, where users publish intents and solvers monitor them.

It Uses a Solver Competition Model

When a broadcaster issues an intent, such as transferring 2,000 USDC from L2 to L3, it is shared publicly for Solvers to see. These independent Solvers compete to find the most efficient way to execute it. The winner is reimbursed through bonded funds or escrow, depending on the setup. While the process is abstracted from the user, the execution remains verifiable and trust-minimized, built on top of Arbitrum’s core security model.

Difference in the Fault Proof System of OP Stack and Arbitrum

OP Stack’s fault-proof system is modular and permissionless, featuring three components: the Fault Proof Program (FPP) for executing full node logic, the protocol-independent Fault Proof VM, and the Cannon-powered Dispute Game Protocol, which uses on-chain binary search for resolving disputes. It is designed for multi-VM compatibility.

In contrast, Arbitrum Orbit employs Nitro’s WASM-based binary bisection model, culminating in one-step proofs verified on Ethereum. With the BoLD protocol, Arbitrum’s system is now fully decentralized, permissionless, and time-bounded, focusing more on performance and decentralization than OP Stack’s flexibility and modularity.

Node Infrastructure Difference Between OP Stack and Arbitrum

OP Stack is built using OP-Geth for execution and op-node for rollup logic, with a private sequencer mempool and a finality system featuring unsafe, safe, and finalized heads. Tools like OP Flashblocks enhance responsiveness by streaming partial blocks.

Arbitrum Orbit runs on Nitro, combining Geth and WASM with elastic block timing, L2/L3 support, and Stylus for enhanced validation. While OP Stack aims for a structured, unified Superchain vision, Arbitrum favors decentralized flexibility with support for custom infra, third-party DA, and WASM-native execution.

VM Architecture

OP Stack relies on OP-Geth, a lightly modified Ethereum EVM supporting only Solidity, but with future extensibility via diagnostic tools for custom VMs.

Arbitrum Orbit, powered by Nitro and Stylus, supports Solidity, Rust, C, and C++, offering faster, cheaper execution through WASM, parallel processing, and extended hardware control. The contrast lies in ethos: OP Stack prioritizes compatibility and standardization, while Arbitrum embraces multi-language, high-performance execution for advanced dApps.

Which One to Choose?

If you’re aiming for a streamlined, Ethereum-aligned build with predictable rules and a growing shared ecosystem, OP Stack is the way to go. It’s built for teams that value long-term structure, modular upgrades, and simpler governance under the Superchain vision. Projects like Worldcoin choosing OP Stack show real-world confidence in that roadmap. Plus, its permissionless fault-proof system and clear finality model make it a strong fit for developers who want a clean, standards-driven experience without surprises.

But if your focus is flexibility, experimentation, and building something outside the norm, Arbitrum Orbit gives you more creative freedom. With custom gas tokens, full control over governance, WASM execution through Stylus, and full L3 support, it’s designed for developers who want to push boundaries. Its Universal Intents Engine simplifies cross-chain actions, and with BoLD live, it offers one of the most decentralized fraud-proof setups today. For high-performance or app-specific chains, Orbit hands you the entire toolkit.

FAQs

What is the core difference between OP Stack and Arbitrum Orbit?

OP Stack follows a standardized, Ethereum-aligned architecture while focused on building a Superchain. Arbitrum Orbit, on the other hand, focuses on chain sovereignty, modular tooling, and support for custom L2 and L3 chains.

**Can I use a custom gas token on OP Stack or Arbitrum Orbit?**Only Arbitrum Orbit supports custom gas tokens. OP Stack enforces ETH-only gas to maintain uniformity and ETH neutrality across the Superchain.

**What programming languages are supported on both platforms?**OP Stack supports Solidity only. Arbitrum Orbit, with Stylus, supports Solidity, Rust, C, and C++, allowing more versatile smart contracts.

**Which platform supports L3 chains?**Only Arbitrum Orbit supports L3 chains that settle on L2s like Arbitrum One or Nova. OP Stack does not currently support L3 deployments.

**How do fault proofs work on each platform?**OP Stack uses a modular, multi-VM dispute system powered by Cannon. Arbitrum Orbit uses Nitro’s binary fraud proof system, recently upgraded with the BoLD protocol for full decentralization.

**Is data availability more flexible on one platform over the other?**es, Arbitrum Orbit supports Ethereum, AnyTrust DACs, and third-party DA layers like Celestia. OP Stack supports Ethereum DA by default, with Alt-DA in early stages.

**What is the Universal Intents Engine in Arbitrum?**It allows users to express cross-chain intents without detailing execution paths. Solvers compete to fulfill these intents efficiently within seconds.

**Which is better for developers building high-performance apps?**Arbitrum Orbit is better for high-performance dApps due to WASM execution, Stylus support, and flexible L3 design. OP Stack is more suitable for Ethereum-aligned dApps seeking stability.

Now on an average, to set-up such payment rails using a blockchain infra, there’s roughly $3M to $15 M  in investments that these private institutions must undertake to build their infra. That said, no private financial institution would risk modernizing their systems unless they’re certain that  they won’t be facing the same fate as Signature or Silicon Valley Bank due to inefficient  blockchain  infrastructure.

And that’s where the role of a robust, matured and battle-tested blockchain infra begins that can help them undertake smooth transition without risks involved.

ZKsync’s Prividium is going to do that, ensuring private institutions get that on their own terms. In this blog, we shall see how Prividium would make that happen for the private financial institutions, some other benefits, a case study of a live Prividium chain, and a lot more.

What is  ZKsync Prividium

ZKsync Prividium, as an  enterprise-ready blockchain solution, has been  designed to help organizations meet mission critical needs of private finance  like compliance, privacy, speed, security, and interoperability all occurring at once.

Due to this trade off, Prividium supports a wide range of financial use cases, from settlements and treasury management to asset tokenization.

But the interesting part every enterprise would love at first glance is allowing them to do all of that with existing  infrastructure, without the need to rebuild systems from scratch.

But, with Prividum,  this setup might  mirror a rollup architecture which might bring some new vulnerabilities is something private financial institutions might think. And due to that, concern for institutions who might have tried a rollup before would be popping up in their head like  MEV, front running. But such is not the case when you know how Prividum differs from rollups.

How does ZKsync Prividium Works?

There are a lot of checklists to acknowledge when you want a private institution app to have full control over their environment without the need to create an infrastructure from the ground up . And that’s where Zksync Prividium appeals to enterprises through an interface that might look like a public blockchain from a vantage point but look closer, and you find everything hybrid;

• Access Control Powered by YAML

• Private RPC Proxy through DMZ / API Gateway

• Private Subnet / Application Tier for verifiability , anonymity and camouflage.

• ZK Porters for proof submissions

The Benefits of ZKsync Prividium Chains:

Here are what private financial institutions will get from its design principles:

1. Complete Privacy and Control

Financial institutions have sensitive data with them like client identities, trade information, and even fund positions. When they are  exposing the same to others using a public chain, it exposes multiple issues. For example, from the standpoint of a direct attack, it could be wallet compromise, ransom, fishing attacks and so on. And from an infrastructural drawback, a public chain can expose MEV risks. But since ZKsync Prividium would be giving a selective disclosure to the application,  it can protect users from such exploits. ZKsync claims applications can have full control over the data and logic to ensure that privacy and control stay with institutions despite using public blockchains  as mentioned in the tweet below;

2. Compliance Ready Chain

Private financial institutions refrain from allowing anyone to participate in their chain and meddle with their operations. Due to ZKsync Prividium’s on-chain identity traceability, enterprise applications hosted using  Prividium  can experience compliance by design but in the process, having full sovereignty to do things in the manner that would best to bake their own logic into the system. Due to this, despite using a public chain like Ethereum for security, banks, asset managers and other verticals can easily operate on top of the stack allowing them complete control.

3. Battle Tested Security

Security is paramount for the users and any instances of frauds or deceit should be easily auditable and traceable. Since with private blockchains, everything is highly siloed, it creates information/ accountability barriers. For anchoring the trust, private financial institutions need where they can verify and validate doubts but in the process, do not end up revealing data.

Through cryptographic proof generation that settles to Ethereum, the private financial institutions would be providing the security that users are seeking while using the financial application but at the same time, they can also protect chain snooping of sensitive data while doing the same. Alex Cardova, the CEO of Tradable lauds ZKsync for its robust security and Prividum using the ZK Stack inherits the same security levels.

4. Interoperability by Design

At the moment, private financial institutions need to build bridges/ relayers with the partner networks when they are looking to interoperate. But in the process, they put security of the chain under risk. But with ZKsync Prividium, now private financial institutions can use the ZkSync chain architecture to set up smooth interoperability with the partner ecosystems making the stack suitable for those applications that are looking forward to launching multi-asset strategies and international operations.

The Target Use Cases Of Zksync Prividium Infrastructure:

1.Collateral Mobility:

At the moment, mobility of the collaterals are not expansive to accommodate borderless operations for TradFi. For context, the banks involved in the collateral exchange might face auditability and accountability loopholes  because of different geographical locations, regulations and information blockade. But with Zksync Prividium, now banks/ financial institutions can easily exchange value despite being offshore in a real-time automated manner using smart-contracts. And while doing the same, they can even comply with regulatory checklists.

2.Wholesale Cross Border Payments:

At the moment, while undertaking cross border payments, banks have to settle for a check and balance mechanism, wherein, the receiver account will settle for the native fiat currency in exchange for foreign currency by verifying the source but different payment rails, time zone settlements  create synchronicity among these systems. .With provable Zk-verified systems, now these lags could be mitigated for instant payment settlements, allowing traditional financial institutions to experience near instantaneous settlement and access global liquidity without any risk.

3. Global Payroll:

At the moment, if private financial institutions want to integrate a globalized system of payments for their enterprise clients, they face major roadblocks because employees might have to be paid in different currencies. In addition to that, there’s regulatory compliances to meet like tax laws, reporting and so forth. All of these make global payroll a headache for enterprises that they cannot cross due to lack of technological infrastructure. With ZKsync Prividium, this is getting resolved from the ground up.

4.Token Asset Issuance & Servicing:

At the moment, private financial institutions like banks, asset managers and even economies are issuing tokens against assets like government securities. But in the process, they create a barrier when regulation is involved. Moreover, network non synchrony creates real hassle to settle in real time. ZKsync Prividium allows role based controls and regulatory visibility without diluting the security to help make asset based issuance via tokens simple and fortified.

A Case Study of The First ZKsync Prividium Chain: Memento’s ZK Chain by Zeeve RaaS

Memento blockchain became the first real world experience  to check the market readiness of   ZKsync Prividium  for  launching Institutional DeFi Infrastructure for Project DAMA. Deutsche Bank wanted to modernize fund management in Singapore through project DAMA. But in pursuit of this, they faced pressing challenges like;

• High Cost

• Slow fund deployment

• Limited Liquidity

• Regulatory constraints.

Zksync Prividium chain allowed the Memento blockchain to validate funds coming from multiple sources that required permissions from multiple custodians, administrators, and intermediaries to launch Project DAMA. Due to this advantage, what could have otherwise taken months for Deutsche Bank was completed in a few  days only with low fees, private-permissioned infrastructure and multichain readiness.

But this transition wasn’t simple because multiple aspects were to be considered, improvised and delivered like logo bricks.  For example;

• ZK Stack Deployment

• Private Explorers and RPCs

• ACL for Smart Contract Deployment

• ACL for Contract Interaction

• Custom L1→L2 Messaging ACL

For assembling all of these  together, Zeeve played a pivotal role for the Memento blockchain  to launch its first Institutional DeFi Infrastructure helping with : (i) Technical improvisations (ii) Security & governance (iii) Scalability & Future Readiness (iv) DevOps Automation (v) Enterprise Support (vi) Zero Trust Principles (vii) Custom L1→L2 Filtering Smart Contract.

Read the use cases  here to know how the process was expedited to launch the chain in days and not months or years.

Due to such a quick leap in such a short time, in May , Cointelegraph Magazine featured Memento ZK Chain alongside leading RWA and institutional infra players like Securitize, Tradeable, Ant Digital, and Ethena.

Build Your ZkSync Prividium  Chain with Zeeve

Zeeve, as a trusted partner can help you launch a ZK rollup or ZKsync Prividium chain purpose built for your application. So far, Zeeve has been instrumental in helping some of the big names like Memento, Syscoin’s zkSYS, and many others to launch their ZK chains. If you want to build your own private financial application and you are looking for a Private financial infrastructure for moving your financial application onchain, Zeeve’s valuable integration partners, and fully managed ZKsync infrastructure-as-a-Service could provide the necessary support that you are seeking.

For further assistance to launch your custom ZKsync Prividum finance app or chain, our experts are just a click away to help you in all possible ways.