Gotta bridge them all
[ - by moon]
Hi friends, I’m moon. You may remember me from such X threads as:
“How to Hack the IOTA Coordinator with a Raspberry Pi”
“How to Make Your Own Shimmer NFTs Using MS Paint”
“How to skip IOTA 2.0 and start with 3.0 instead”
Today I’m writing about a more serious topic: the ShimmerEVM bridge.
Let’s GO
Disclaimer: Always conduct your own research.. This post is not investment advice.
We are back baby
Crypto winter was long and cold. It’s still cold outside, I know (unless you live in Australia), but we can now say the bull market has started.
So what happened?
Bitcoin ETFs have been approved and the halving event is getting closer and closer. To be honest, the approval hasn’t started a real rally yet. Keep in mind that ETFs will bring more institutional money into crypto, as they offer a more convenient and regulated way to invest in Bitcoin.
This event is a long-term play, so the real BIG pumps should come from time to time.
As a non-BTC maxi, I care more about altcoins like IOTA and Shimmer, especially since the launch of the ShimmerEVM. We can see DeFi use cases growing, and with it, the whole ecosystem.
You don’t know what EVM is or does? I will explain:
Shimmer EVM
A crypto token without smart contracts is like french fries without ketchup: incomplete. (This post is not sponsored by McDonald's.)
Shimmer does not have SC (smart contract) on its Layer 1 yet. So EVM (Ethereum virtual machine) has to be our ketchup.
ShimmerEVM is the first application layer anchored to the Shimmer network. So it is a Layer 2 solution. It allows the execution of Ethereum based smart contracts in a fast and secure way. Without Smart contracts Usecases like DeFi wouldn’t be possible on the Shimmer network. Thanks to the EVM, the Shimmer ecosystem is growing rapidly especially in the DeFi sector.
Smart contracts facilitate transactions within a dApp, enabling the exchange of value, such as tokens or data, between parties without the need for a third player. It might sound like one of those 'cut the middleman' scenarios, but I swear it is true and legit.
Computer power is necessary to calculate and execute a smart contract, for example, to provide liquidity in a pool. DApps like ShimmerSea, Nakama Labs portfolio, and Tangleswap are the OGs in this scene.
Other use cases, such as minting and swapping NFTs, as well as verifying ownership, depend on smart contracts. By the way, CHECK OUT Soonaverse for your NFT needs.
“It seems legit, but why do we need a bridge?"
Gotta bridge em all
Are you tired of only using Ethereum-based chains? It's time for a change. Shimmer now has a bridge, and it's been in operation for +1 Month.
So we have Stuff like DeFi running already on ShimmerEVM. What benefit does the bridge bring?
Have you ever played one of the first Pokemon editions on the Game Boy? No WLAN, no Bluetooth, no infrared laser stuff, and no internet. So you could do everything on your own device (blockchain) but cannot connect to other devices... unless you were one of the cool guys with rich parents who bought you a "link cable" (bridge). This cable, bridge, whatever enabled your Game Boy to connect to another device to trade your Pokemon.
Well, the same goes within the crypto world. Without a bridge a blockchain would operate in isolation, limiting the scope of dApps and smart contracts to their native blockchain.
Assets like BTC, ETH, and stablecoins like USDT can now be smoothly transferred to the ShimmerEVM network without a hassle. This brings in some fresh cash from outside the bubble, to the Shimmer ecosystem.
Use shimmerbridge.org/bridge for easy transfer between different chains
Powered by LayerZero
One of the most OG bridges is LayerZero. A protocol that helps different blockchains interact with each other. It allows data and value to be transferred across many chains (cross-chain).
It is especially useful when a dApp or a smart contract needs to work on several
blockchains.
This bad boy connects over 50+ blockchains with each other and as of the latest data, LayerZero has transferred over 90 million messages across supported blockchains, with a total value transferred exceeding $50 billion. Not bad!
So where do we stand now?
EVM is ready
Bridge is ready
How can we measure the success of Shimmer?
TVL!
TVL stands for Total Value Locked. It is the number #1 metric to measure DeFi dApps success in a chain. So more TVL means more popularity and trustworthiness. It also shows liquidity and availability.
For example, if you deposit 1 $SMR into a DeFi platform like ShimmerSea on ShimmerEVM, the TVL of that platform increases by the current market value of 1 $SMR. If the user borrows 100 LUM from the same platform, the TVL does not change, because the borrowed LUM is still backed by the deposited SMR. However, if the user uses the borrowed LUM to buy more SMR and deposit it back to the platform, the TVL increases by the value of the newly deposited SMR. I hope this makes sense to you. It is easier to understand if you try it yourself.
Let's check out the numbers for our boy Shimmer, as per DeFiLlama:
The TVL of ShimmerEVM has seen a big rise in recent weeks, going from $4-$5 million to around $13 million.
There are 7 registered DeFi dApps, and ShimmerSea is numero uno with a TVL of $5.7+ million.
As of writing, ShimmerEVM holds the 73th place among all chains.
Overall, Shimmer had a good start. We have to keep in mind that the IOTA ecosystem missed the DeFi hype train 2 years ago. But now, we are back. The ecosystem is established and working. Other narratives like real-world assets and AI are taking over. But hey, the narratives are always rotating, and I believe we will see DeFi coming back very strong again. Especially when Degens who made a big chunk in the bull market want the tastiest yield. Also, there are Bitcoin L2 Dapps forming, but that's another topic for another rainy day.