Wormhole is the leading interoperability platform powering multichain applications and bridges at scale. The platform is designed to connect different blockchains, allowing for the secure and efficient transfer of data and assets. Wormhole uses a rate-limiting mechanism — 'the Governor' — to improve security and prevent abuse. For a supported chain, the Governor enforces an upper limit on the chain's total (USD-denominated) outflow within a 24-hour window. Outgoing transfers that exceed the chain's limit are queued until the window slides and capacity is freed up again. In this way, no transfer is held longer than 24 hours.
The Need for a Flow-Canceling Governor Mechanism
Currently, several chains are frequently at nearly 100% of their Governor limits, causing delays and frustration for some users. This congestion is often due to users transferring assets in and out of the same chain, typically for arbitrage or settlement needs. Although these behaviors are not fraudulent, they can inadvertently consume Governor limits, leading to a delay of transactions during high utilization periods. With the growing adoption of Wormhole, this behavior will likely continue, which could reduce the utility of Governor limits to guard against unforeseen risks.
Flow-Canceling Design
To address this issue, Wormhole has implemented a flow-canceling Governor mechanism.
Here’s how it works:
- Measuring net flow: Instead of only considering outflows from each chain, the Governor will also account for inflows into each chain. When assets flow in, the Governor will reduce the limit utilization, effectively canceling the outbound flows, which increased it in the first place. This means only net flows (the difference between inflows and outflows) will be constrained.
- Net flow handling: When users move a fixed amount of assets in and out of a given chain, the net flow is zero. The new behavior will recognize this and prevent this flow from consuming Governor limits.
- Reputable assets: Flow-canceling is enabled for a subset of stablecoins. This allows for improved net flow across supported Wormhole chains while retaining the security benefits of the Governor limits.
Benefits of the Flow-Canceling Governor:
- Users will no longer face delays when the net flow (outflow - inflow) is below the Governor limit for a given chain.
- Wormhole can support more transaction flow in both directions without increasing Governor limits.
- The protocol reduces risks and better guards against vulnerability impacts by maintaining lower limits.
- All Wormhole participants (Guardians, Contributors, and Builders) will spend less time on governor limits and more time building the future of interoperability.
Backtesting Analysis
To evaluate the flow-canceling strategy, a mock implementation was tested against historical VAA flows. The results showed that net flows were significantly lower than a simple outbound strategy, meaning that a flow-canceling strategy will reduce the potential for user delays.
Further analysis revealed that stablecoins (like USDC and USDT) represent a large share of Governor limit utilization. By applying flow-canceling only to these tokens, Wormhole can achieve significantly more transaction volume without exposing the protocol to the volatility of other tokens.
To find more details about this analysis, refer to the following governance discussion: https://github.com/wormhole-foundation/wormhole/discussions/3783
Conclusion
The flow-canceling Governor mechanism offers a promising solution to congestion issues during high utilization. It enables Wormhole to support more transactions while maintaining security and liveness objectives. By focusing on net flows, Wormhole significantly improves the cross-chain experience and reduces delays during high utilization periods.
About Wormhole
Wormhole is the leading interoperability platform that powers multichain applications and bridges at scale. Wormhole provides developers access to liquidity and users on over 30 of the leading blockchain networks, enabling use cases that span DeFi, NFTs, governance, and more.
The wider Wormhole network is trusted and used by teams like Circle and Uniswap. To date, the platform has facilitated the transfer of over 40 billion dollars through over 1 billion cross-chain messages.