Chainflip

Chainflip is a decentralised cross-chain protocol that lets people swap cryptocurrency assets between major blockchains directly, without handing custody of those assets to a third party at any point. The problem it aims to solve is the friction and counterparty risk that typically come with moving tokens from one blockchain to another, whether through centralised exchanges or conventional bridge mechanisms that rely on wrapped tokens. Its intended users are anyone who wants to exchange native assets across different networks in a single, self-custodied transaction.

Chainflip runs on its own blockchain secured by a set of 150 validators, each of whom must stake the protocol's native FLIP token to participate and earn FLIP rewards in return. Swaps are priced through a novel mechanism the project calls a Just-in-Time Automated Market Maker, or JIT AMM, which allows liquidity providers to submit quotes at the moment of each swap rather than holding passive positions. A portion of every swap automatically triggers the purchase and burning of FLIP tokens from the liquidity pool, creating a mechanical link between trading volume and the circulating supply of the token.

Fees are generated by the swap activity that flows through the protocol, with each transaction producing revenue that is returned indirectly to validators rather than distributed as a direct payment stream. A portion of every swap is used to buy and burn FLIP, which reduces supply rather than routing value to a treasury or token holders in cash form. At the point in time recorded here, the protocol held total value locked of 14,395,772.28 USD against a market capitalisation of 39,359,455 USD, producing a market-cap-to-TVL ratio of 2.73 and a fully diluted value-to-TVL ratio of 2.76, both of which reflect how the market is currently sizing the protocol relative to the assets it holds.