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ZIP-20 Standard

The ZIP-20 standard is currently in development. This section provides a high-level overview of the ZIP-20 standard and its benefits for the ZenChain ecosystem.

ZenChain introduces the ZIP-20 standard, an advanced cross-chain interoperability technology designed to facilitate seamless asset transfers between ZenChain and any external blockchain supported by the Cross-Chain Interoperability Module (CCIM). Inspired by the widely-used ERC-20 standard on Ethereum, ZIP-20 extends its capabilities to support a broader range of assets, enabling secure and efficient bridging and asset management across multiple blockchain networks.

The primary goal of the ZIP-20 standard is to provide a flexible, scalable, and secure framework for representing and managing assets from external blockchains within the ZenChain ecosystem. ZIP-20 enables the creation of tokenized versions of assets (such as Bitcoin, Ethereum, or any other blockchain-native asset) on ZenChain, facilitating advanced functionalities for asset management and cross-chain interactions.

Key Interfaces​

  • Facilitator Interface: Allows entities, known as Facilitators, to mint and burn ZIP-20 tokens (representations of external blockchain assets) in a controlled and scalable manner.

  • ZIP-20 Token Interface: Represents an ERC-20 compliant tokenized version of any external blockchain asset within the ZenChain ecosystem, enabling advanced functionalities for managing Facilitators, adjusting minting limits and ZIP-20 tokens.

Key Features​

The ZIP-20 standard is designed to support a wide range of blockchain assets and offers several innovative features to facilitate seamless cross-chain interoperability:

  • Bridge Facilitators: These Facilitators utilize a direct bridge mechanism supported by CCIM to maintain a 1:1 peg between the ZIP-20 token on ZenChain and the corresponding asset on an external blockchain. For example, zBTC - a ZIP-20 token representing Bitcoin would be pegged to actual Bitcoin held in a secure vault, with the process managed by ZenChain Validators through a multisig account. This trust-minimized bridge ensures a secure and decentralized transfer of assets, secured by the CLCM consensus of ZenChain to safeguard against collusion.

  • Custom Facilitators: Custom Facilitators allow for more flexibility by enabling different methods to maintain the peg of a ZIP-20 token. For instance, an asset not directly supported by CCIM could also be represented as a ZIP-20 token on ZenChain through over-collateralization or other financial mechanisms. These Facilitators must receive approval from ZenChain governance and are assigned specific minting limits, ensuring a regulated yet innovative approach to expanding asset options within the ZenChain ecosystem. While these assets cannot be directly bridged without CCIM integration, they can still be valuable for DeFi applications, providing new financial opportunities within the ecosystem.

  • General-Purpose Design: The ZIP-20 standard is designed to be chain-agnostic, allowing ZenChain to support any blockchain integrated through the CCIM or through alternative mechanisms like Custom Facilitators. This versatility makes ZIP-20 a powerful tool for cross-chain asset management and DeFi innovations.

By leveraging ZIP-20, ZenChain provides a standardized approach for integrating and managing assets from various external blockchains, enhancing its cross-chain interoperability and expanding its ecosystem.