Universal Market Access (UMA) is scaling on Polygon (previously known as Matic) by making it possible for multiple Ethereum Virtual Machine (EVM) compatible scaling solutions to be part of its ecosystem.
Ethereum Virtual Machine Craze
UMA is a protocol that allows for the creation of synthetic assets on blockchains. Originally only on Ethereum, the team announced on Friday, June 19, a plan to scale onto Polygon and boost their EVM support across multiple chains they support. The protocol has always been about growing accessibility– it is right in the name– and this step with Polygon expands their reach.
UMA is an open-source infrastructure that merges two technologies to create fast, efficient, and secure derivatives. The UMA protocol is achieved through priceless financial contract templates to create synthetic tokens and a decentralized oracle service to manage and enforce contracts on UMA. The DVM will be on the Ethereum blockchain, and the contract will live on Polygon.
DVM as Dispute Arbiter
One essential component of the UMA ecosystem is the Data Verification Mechanism (DVM). It helps ensure that contracts remain secured by playing the role of an arbiter for disputed liquidation. In short, DVM is a dispute resolution protocol as well as a regulator.
The basis of the entire interaction on UMA is to produce synthetic assets through collateralization. The system has to ensure that the position of the token sponsors remains overcollateralized to prevent liquidation. However, to avoid a wrong liquidation position, an invalid liquidation will be escalated by “Disputers” to the DVM to be resolved.
How Scaling Can Be Established
UMA has always had the dispute layer and the contract layer decoupled. The ability to maintain a decoupled dispute layer and contract layer is vital. A successful scale will allow for deployment on any EVM chain efficiently. Interaction between the two chains established through a communication channel that will bridge the two chains.
Contracts on Polygon will allow for price requests to be escalated to the DVM even though they are on the Ethereum mainnet. The cross-chain bridging happens when UMA calls on ‘Oracle Child Tunnel’ to the ‘Oracle Root Tunnel.’ The “Oracle Child Tunnel” exists only to interact with the “Oracle Root Tunnel” on the Ethereum network. The Child Tunnel is the official connection between the chains. In the tunnels, the disputes are resolved through the DVM protocol.
The price resolution from the DVM is shuffled between the corresponding smart contract and the mainnet. Conflicts are put up for resolution by proposing that the UMA token validate the asset’s price at the given timestamp. UMA voting token holders can then vote to resolve the dispute and the asset’s price. The votes are consolidated, and the price is then reported on-chain.
UMA Starts With Polygon
The two key characteristics that make the entire process scalable are that the communication across bridges is trustless and permissionless. Polygon’s arbitrary message system will allow the communication between the two tunnels to take place without the need for a centralized actor to relay the information. UMA plays the role of a trustless arbitrator.
Developers can rely on UMA’s proven mechanism to secure contracts and retain their choice of scaling solution. The UMA teams deployed the same logic on Polygon. This process will allow UMA’s contract to interact with other EVM compatible scaling solutions through the trustless communication bridge.
UMA’s developers can enjoy a seamless experience with Polygon’s full-stack scaling solution. With more than 400 Dapps available, UMA’s choice of Polygon to scale its open-source infrastructure platform positively impacts the DeFi Developers who build synthetic assets.
Multi-Chain Interoperability
Polygon is fast becoming one of the most popular scaling solutions. Its ability to exist as a sidechain to Ethereum is vital to that escalation. Polygon uses its cross-chain interoperability to become a fundamental layer in the DeFi ecosystem, with speed and costs being the most appealing factors. UMA’s protocol of governance through its DVM is a solution that can interact with multiple EVMs by building bridges enabling it to be interoperable.
Polygon is the first to be added to UMA. However, the list of scaling solutions can certainly be extended to cover other scaling solutions such as Optimism and Avalanche. This scaling can is done using the same method of deployment. Priority for escalation is given to projects that exhibit the most substantial developer interest for UMA.
What is UMA
UMA is a platform built to enable Universal Market Access for decentralized financial contracts. UMA was launched in December 2018. Since it began, it has been governed by a global community of former Google and Goldman Sachs employees plus economic advisors. They are strategic partners with names like Coinbase and Bain Capital. The protocol empowers DeFi developers to build synthetic assets on the Ethereum mainnet.
Source : bsc.news
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