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04 Mar 2024

2 min read

Magpie - Case Study

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The Challenge

Bridging today is broken. Security and liquidity are fragmented across protocols and assets. This fragmentation hinders the seamless exchange of assets and information, creating inefficiencies and barriers for users and developers alike. The adverse impacts of liquidity fragmentation across chains, protocols, and wrapped assets are simply too significant to be ignored. This catalyzed a pressing need for a more secure and efficient solution for cross-chain asset swaps, leading to the advent of Magpie.

The Solution

Magpie aims to solve the security issues associated with cross-chain asset transfers by making cross-chain asset swaps fully non-custodial. Instead of locking assets on-chain, Magpie leverages cross-chain messaging powered by Wormhole to communicate asset swap signals across blockchains.

These cross-chain messages generate a Verified Action Approvals (VAA), which the Wormhole Guardians attest to. Once a quorum on a message is reached among the 19 Wormhole guardian nodes, the Magpie relayer queries Wormhole Guardian Nodes and fetches the VAA, subsequently completing the cross-chain swap upon receipt of the signed VAA.

The Results

Leveraging Wormhole’s cutting-edge cross-chain messaging technology, Magpie can provide users with a fully non-custodial and highly secure cross-chain trading experience across over 30 blockchains. Magpie allows users to easily explore the wide range of opportunities offered on different networks, expanding the user base for individual projects across these chains and fueling innovation as ideas and perspectives are shared across platforms.

By aggregating the liquidity from existing DEXs and bridging protocols, Magpie also significantly reduces liquidity fragmentation and maximizes liquidity usage, resulting in improved market depth, cost-efficiency, reduced slippage, and better asset pricing.

Wormhole’s cross-chain messaging empowers Magpie to create a more user-friendly and robust DeFi experience, enabling anyone to access and swap thousands of different tokens cross-chain, both efficiently and securely, rather than limiting swaps to a handful of native assets and stablecoins.

About Wormhole

Wormhole is the leading interoperability platform for multichain bridges and applications. 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, and to date, the platform has facilitated the transfer of over 40 billion dollars through over 1 billion cross-chain messages. 

To learn more about Wormhole, visit the Wormhole website, Twitter, Discord, or blog.

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