Chain Fusion technology from the Internet Computer (ICP) brings a suite of powerful capabilities to the Ethereum ecosystem. By integrating ICP's unique features, Ethereum smart contracts can now leverage threshold signing services, oracles, decentralized autonomous organization (DAO) frameworks, privacy tools, passkey authentication, smart contract wallets, and reverse gas fees. This integration allows developers to augment existing Ethereum decentralized applications (dapps) and build seamless multichain solutions for decentralized finance (DeFi), non-fungible token (NFT) trading, payments, SocialFi, and more.
Full support for Ethereum and other Ethereum Virtual Machine (EVM) chains is now live. This enables ICP smart contracts to enhance EVM-based smart contracts with new functionalities, transfer tokens across different blockchains, and interact with smart contracts on EVM networks efficiently.
Extending Ethereum with Advanced ICP Features
Ethereum remains the leading blockchain for DeFi, with billions of dollars in total value locked (TVL). By integrating with the Internet Computer, Ethereum gains access to cross-chain benefits such as increased asset liquidity, broader market access, and significantly improved scalability and transaction throughput. Additionally, developers can utilize ICP’s standout capabilities.
Fully On-Chain Web3 Infrastructure
Decentralize your Ethereum dapp entirely by hosting both frontend and backend data directly on the Internet Computer. This eliminates reliance on centralized servers and enhances security.
Gasless Token Swaps
With chain-key tokens like ckETH and ckERC-20, users can swap tokens for just a few cents, completely eliminating gas fees. This makes micro-transactions and everyday crypto interactions economically feasible.
Web2 and Real-World Data Integration
ICP smart contracts can fetch real-time data from external Web2 sources, such as price feeds and APIs. This bridges the gap between blockchain and traditional web services, enabling more dynamic and responsive dapps.
Enhancing Multichain DeFi with Chain-Key Tokens
High transaction fees on Ethereum have often made small-value swaps impractical. For example, in May 2024, the average transaction fees for USDC and USDT were $6.66 and $9.93, respectively. The integration of ICP with Ethereum introduces chain-key tokens like ckETH and ckERC-20 to the Internet Computer environment.
These tokens allow users to send and receive ETH-based value on ICP decentralized exchanges (DEXs) with minimal cost—only a few cents per transaction—and achieve finality within one to two seconds, all without gas fees. Moreover, ckETH and ckERC-20 comply with ICRC-1 and ICRC-2 token standards, making it easy for ICP wallets to support them. The total value of ckETH is fully backed 1:1 by ETH, and users can verify reserves at any time through on-chain dashboards and metrics.
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EVM Integration on the Internet Computer
The Ethereum Virtual Machine (EVM) is now available on the Internet Computer, thanks to Bitfinity—a development team within the ICP community. Bitfinity offers a turn-key solution that allows developers to run Ethereum dapps on ICP using Solidity. This integration brings ICP’s rapid finality (1-2 seconds) and near-zero transaction fees to established Ethereum applications, offering a highly efficient scaling solution.
How Ethereum Integration Works on ICP
EVM RPC Canister
The EVM RPC canister is an ICP smart contract that enables communication with Ethereum and other EVM blockchains via an on-chain API. It introduces methods that greatly simplify the developer experience. The current Tritium milestone supports interactions with Ethereum, Arbitrum, Optimism, and Base. Expanding interoperability to other networks is as straightforward as adding additional API keys.
Chain-Key Signatures
ICP nodes work together to generate threshold-ECDSA signatures, allowing canister smart contracts to sign Ethereum transactions. By utilizing the EVM RPC canister, these transactions can be executed on EVM chains. Chain-key signatures also enable the derivation of Ethereum addresses, empowering ICP smart contracts to read, write, and hold ETH.
Understanding Chain Fusion Technology
Chain Fusion is the underlying technology that powers cross-chain interoperability between ICP and Ethereum. It combines threshold cryptography, decentralized oracle networks, and advanced smart contract capabilities to create a seamless multichain experience. This allows developers to build dapps that leverage the strengths of multiple blockchains without compromising on security or decentralization.
Innovative Projects Building on Ethereum and ICP
A growing number of projects are leveraging the integration of Ethereum and ICP to create innovative use cases. Below are some notable examples:
Bitfinity
A high-performance EVM that enables the deployment of Solidity-based smart contracts on the Internet Computer.
MSQ
A MetaMask Snap-compatible wallet that supports ICRC-1 token payments for smooth cross-chain transactions.
zCloak
Developing a chain abstraction-based zero-knowledge co-processor on ICP to enhance privacy and scalability.
SIWE (Sign-In With Ethereum)
A set of support libraries and template dapps that simplify EIP-4361 standard authentication for Ethereum developers.
Helix
A hybrid spot orderbook DEX built on ICP, offering advanced trading features with minimal fees.
Orally
A decentralized oracle provider making real-world and digital asset data accessible on-chain.
Chainsight
A data processing layer that helps developers create dapps using historical, real-time, and cross-chain data.
NFID Vaults
An omni-chain smart wallet protocol designed to protect digital assets from theft, loss, and fraud.
Frequently Asked Questions
What are chain-key tokens?
Chain-key tokens such as ckETH and ckERC-20 are representations of Ethereum-based assets on the Internet Computer. They are fully backed 1:1 by their underlying assets and allow for fast, low-cost transactions without gas fees.
How does ICP improve Ethereum scalability?
By leveraging ICP’s high throughput and low transaction costs, developers can offload resource-intensive operations to the Internet Computer while maintaining seamless connectivity with Ethereum.
What is threshold ECDSA?
Threshold ECDSA is a cryptographic method that allows multiple parties to collaboratively generate signatures. This enables ICP smart contracts to securely sign transactions on behalf of Ethereum addresses.
Can I use my existing Ethereum wallet with ICP?
Yes, through projects like MSQ and wallets that support ICRC tokens, users can interact with both Ethereum and ICP ecosystems using familiar tools.
What kinds of dapps benefit most from this integration?
DeFi protocols, NFT marketplaces, cross-chain payment systems, and SocialFi platforms can all benefit from enhanced scalability, lower costs, and improved user experience.
Is the Internet Computer fully decentralized?
Yes, the Internet Computer is a decentralized blockchain network that operates using a network of independently owned nodes around the world.
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Stay updated with the latest developments in Ethereum and Internet Computer integration by following official channels and community announcements.