Open Intents: Can ERC-7683 be the 'Walmart' supermarket for inter-chain intent coordination on the Ethereum network?

Original author: YBB Capital Researcher Ac-Core

1. How to solve the problem of Ethereum fragmentation

! [Open Intents: Can ERC-7683 Become a “Walmart” supermarket for Ethereum chains that intend to collaborate?] ](https://img.gateio.im/social/moments-ba400a893395f4694a76821a8d41f242)

Image source: @ethereumfndn

With the rise of various L2 and DeFi ecosystems, the liquidity fragmentation issue of Ethereum has gradually become apparent, mainly manifested as the difficulty in unifying asset liquidity within the ecosystem, which has been segmented into multiple small pieces by L1 and various L2 solutions. Different L2 solutions compete for TVL, leading to assets and transactions being dispersed across multiple decentralized platforms and protocols. However, these platforms lack effective connections and interoperability, and liquidity on each chain can only operate within its own independent “circle,” exacerbating the overall fragmentation cost of Ethereum.

In 2024 alone, more than 100+ new Ethereum chains will be launched, which is like entering a shopping mall, and we look at a dazzling array of goods, but they all need to be settled in different countries’ currencies. On February 20 of this year, the Ethereum Foundation announced the opening of the Open Intents Framework, allowing Ethereum to have a “single-chain” seamless transaction experience, and achieved support from more than 50 protocols in just a few days.

As explained in openintents.xyz, the Open Intents Framework consists of three core components (see extension link 1):

1. Open Solver: The framework provides an open solver written in TypeScript, which can monitor on-chain events and process intentions. Unlike solvers that depend on specific infrastructure, it shares the reference solver’s protocol independence, supports indexing, transaction submission, rebalancing, and other functions. Developers can customize and adjust it according to their own needs.
2. Composable Smart Contracts: The framework provides a range of pre-built smart contracts, but these contracts are based on the ERC-7683 standard, which defines the logic of how to interpret, execute, and settle intents. By default, limit order trading and Hyperlane ISM settlement are supported;
3. UI Templates: The framework also provides a pre-built, customizable user interface template designed to make the Intent product more accessible to end users.

2. The core ERC-7683 of the Open Intents Framework

Can ERC-7683 of Open Intents become the ‘Walmart’ supermarket of Ethereum cross-chain intent coordination?(https://img.gateio.im/social/moments-ab9b1904f190fb35905bf2467cb3a1e2)

Source: @KanishkKhurana_

ERC-7683 is a common standard for cross-chain intents on Ethereum, led by Across (@AcrossProtocol) and Uniswap Labs (@Uniswap) to achieve intents by standardizing cross-chains. It aims to provide a unified, standardized framework for Ethereum and other blockchains to express and execute cross-chain operations, especially between multiple L2 solutions and sidechains.

The core content and components of ERC-7683:

1. CrossChainOrder Structure: Defines the format of cross-chain orders to ensure consistency across different blockchains and platforms. It regulates the composition of cross-chain transactions, so that operations on different chains can be interoperable;
2. ISettlementContract interface: Standardize the way the settlement process is handled. ERC-7683 defines how to handle the settlement of transactions between different chains through this interface, allowing cross-chain transactions to flexibly perform settlements between different platforms, and supporting customized transaction processes.
3. Fulfil: ERC-7683 introduces the “Fulfil” mechanism, allowing participants to compete to fulfill cross-chain intentions in a shared network. Participants reduce costs and improve efficiency by providing services (such as executing orders) in these networks, making cross-chain transactions more efficient and optimizing user experience;
4. Fill deadline: This is a Uni X timestamp that marks the expiration time of the cross-chain intent. If the intent is not completed within the specified time, it will expire, thereby avoiding long periods of waiting for invalid transactions;
5. Order data type (orderDataType): Use EIP-712 type hash to specify the structure and format of intent data. Through this type hash, developers and platforms can clearly define how data is formatted for transmission and interpretation across different chains;
6. Order Data (orderData): Order data contains the core parameters of cross-chain transactions (such as tokens, quantities, chains, recipients), which define the expected results of cross-chain transactions. It ensures that transaction participants can accurately understand and execute cross-chain operations.

One of the biggest advantages of ERC-7683 is its ability to achieve seamless cross-chain interaction. By standardizing the expression of cross-chain intentions, users can execute operations between different blockchains without complex settings, such as token exchange or NFT transfer. This simplifies the standardized framework of the operation process, greatly reduces the technical threshold of cross-chain operations, and allows users to conduct cross-chain transactions more conveniently.

Second, ERC-7683 also enhances governance. It simplifies the governance process between different blockchains, especially for decentralized autonomous organizations (DAOs), making it easier to manage proposals and decisions across multiple chains. The uniformity of ERC-7683 makes DAO more efficient for cross-chain governance across multiple platforms, increasing the flexibility and transparency of governance.

Where is the end of the abstraction of Intent and DeFAI

! [Open Intents: Can ERC-7683 Become a “Walmart” supermarket for Ethereum chains that intend to collaborate?] ](https://img.gateio.im/social/moments-606118516b8e4469cbb31cc67925ff7f)

Source: Homemade

Whether it is Intent or DeFAI, it is essentially a derivative of the financial attributes of DeFi, but there are only two problems that DeFi really needs to solve, scalability and liquidity. Intent seems more practical to aggregate liquidity through UNI and ERC-7683, while DeFAI is even more interesting with the wave of AI storytelling and the automated AI trading that Hey has Anon(@HeyAnonai) achieved. Intent and DeFAI’s respective solutions focus on improving the user experience of DeFi, optimizing transaction execution, and enhancing the stability and security of the protocol, but there are also differences:

The core goal of Intent is to simplify user interaction through an “intent-driven transaction” mechanism. The user can set the intention and strategy of the transaction, and the system will execute it automatically, without the need for the user to manually intervene in each step. This not only improves the ease of use of DeFi, but also optimizes strategy execution and increases trading efficiency. In addition, intent may also solve liquidity bottlenecks in DeFi through cross-chain technology. By enhancing cross-chain liquidity, Intents help break down barriers between different chains and optimize liquidity pools, thereby increasing the market depth and trading efficiency of decentralized exchanges.

DeFAI, as an AI-based decentralized finance protocol, focuses on solving compliance and risk control issues in DeFi. DeFAI uses AI technology to analyze and predict market trends to help protocols identify potential risks, thereby reducing operational risks while maintaining protocol stability. AI can process large amounts of market data to provide users with more accurate decision-making support, optimize market operations and risk management.

To solve the problem of fragmented liquidity, from account abstraction, chain abstraction to intention and DeFAI, in the final analysis, abstraction is endless, and the needs of technology and the market are also driving the birth of more abstraction levels. We need abstraction, but we also need moderation. The problem of fragmented liquidity itself is more like an ‘ecosystem integration problem’, which not only depends on the increase of abstraction levels, but more on how to optimize existing protocols.

Fourth, why only Uniswap can really drive the development of ERC-7683

! [Open Intents: Can ERC-7683 Become a “Walmart” supermarket for Ethereum chains that intend to collaborate?] ](https://img.gateio.im/social/moments-93d9a0b721767b84fbb4fb2fa0008298)

Source: @Uniswap

While “intent” is a grand narrative concept, from my personal point of view, the core support of ERC-7683 can only be driven by Uniswap. The reason is that both Intent and DeFAI are essentially about better serving DeFi, and the key element to maintain the healthy development of DeFi is the liquidity of the market, and this dependency needs to be built on the two conditions of “efficient liquidity supply” and “deeply integrated liquidity”.

1. Uniswap V4’s Liquidity Advantage

The introduction of Uniswap V4 makes liquidity pool management more flexible and efficient, especially for centralized liquidity provision across different price ranges. This mechanism optimizes capital efficiency and makes cross-chain transactions smoother, in V3 each new pool needs to deploy a separate smart contract, resulting in high gas fees, V4 replaces this with a single PoolManager contract, reducing the deployment cost of centralized management of all mining pools by 99% and lower exchange costs, while Hooks also allows the development of customized AMM pools, so that the ERC-7683 protocol can be adjusted according to different market needs, Better match different trading pairs and asset liquidity.

2. The potential of Uniswap X

Uni X is expected to further enhance cross-chain interoperability by adding a new cross-chain bridging mechanism or deep integration with ERC-7683 to provide a more efficient cross-chain asset exchange channel. If Uni X is able to provide a cross-chain liquidity solution, it will become an important platform for ERC-7683 to execute cross-chain intent. As a result, ERC-7683 is able to enable seamless cross-chain transactions on a larger scale by leveraging Uni X’s liquidity pools and technology optimizations.

3. Cross-chain protocol implementation dependencies

Since ERC-7683 relies on a standardized cross-chain transaction structure and settlement mechanism, Uniswap has a significant presence among decentralized exchanges. The protocol is likely to rely on the liquidity pools, automated market making, and cross-chain trading capabilities provided by Uniswap, especially the support of Uniswap X and Unichain, which not only supports the efficient execution of ERC-7683, but most importantly, ensures the stability and security of its cross-chain and multi-asset transactions.

V. What is the actual meaning of intent

When we set aside the abstract definition of ‘intent’, it can actually be understood as a clear trading objective or driving force. The concept of intent can be traced back to the article ‘Intent-Based Architectures and Their Risks’ published by Paradigm on June 1, 23 years ago, which elaborated on the concept of intent. However, it has always been in the conceptual stage, and issues regarding fragmented liquidity and solver solution paths have not been resolved. Nevertheless, the introduction of ERC-7683 seems to shed light on a better solution to the problem of fragmented liquidity.

The ultimate goal is to breathe new life into Uniswap, hoping that Uniswap will trigger a new round of DeFi boom. So the intent and ERC-7683 are not just to continue L2 scaling, but to achieve more efficient transactions, create richer features and stronger cross-chain interoperability through Uniswap, and even introduce new incentives or trading models to attract more users and liquidity.

If Uniswap V4 or Uniswap X introduces some new smart contract logic or transaction models at the protocol level, through ERC-7683, Uniswap can further improve cross-chain liquidity, reduce transaction costs, and add more trading pairs and liquidity pools on top of the existing AMM model, which will make Uniswap no longer just a liquidity decentralized AMM, and these improvements will also become an important part of the “intent”.

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