blockworks.co
Prime Protocol launched on Moonbeam, Ethereum, Arbitrum and Avalanche today. It offers a cross-chain prime brokerage that seeks to eliminate the need to use token bridges, swaps or wrapped assets.
The protocol uses Axelar’s General Message Passing for interchain communication, and allows users to cross-margin their entire portfolio and borrow against all of their on-chain assets through one protocol.
Colton Conley, the project’s founder, told Blockworks that existing blockchains operate as separate islands. He noted that this can be quite capital inefficient when an investor has their on-chain portfolio spread across multiple blockchains, L1s and L2s.
“Right now the crypto ecosystem is fractionalized and it’s going to be hard to get mass adoption, especially for the kind of end-user who doesn’t want to worry about which underlying chain they are using,” Conley said. “You need a way to provide infrastructure for that user to have a seamless experience.”
Prime resolves this issue by allowing users to get instant liquidity on chain, regardless of where collateral has been locked up, according to Colney.
Any time a deposit is made, Axelar will send a message and record that deposit on Moonbeam. When a user wants to withdraw or borrow, they can request that with any chain supported by Prime protocol. Axelar then facilitates the message and distributes the tokens to the user’s chain of choice.
“By using cross-chain messaging, we keep track of your account all in one place so we don’t have to go and ping every chain you’ve deposited on before to provide you liquidity,” he said. “We have liquidity pools set up on every blockchain. So the tokens are available for you, regardless of where you’re at.”
The tokens available at launch on each blockchain include:
- ETH assets: ETH, USDC, USDC
- GLMR assets: GLMR, USDC, DOT, USDT
- AVAX assets: ETH.e, USDC, USDT
- ARB assets: USDC, ETH
Although Prime Protocol will only make a handful of tokens available on each chain at the initial launch, Conley stated that there are plans to include a large variety of collateral in the future.
“If anybody is aggregating liquidity or also working in this space, I would love to collaborate with any of those protocols. Wherever there is scope for collaboration with those kinds of players, I’m absolutely looking forward to it,” Conley said.