Connext is an interoperability protocol designed for rapid, non-storage-related asset transfers between blockchains, as well as contract interactions across EVM-compatible networks.

Connext addresses the liquidity gaps that can arise in L2 solutions and EVM environments. Put simply, it functions like a crosschain bridge. Shortly after launch, Connext NXTP increased main-network coverage to 9 networks, including Ethereum, Polygon, Arbitrum and Avalanche. Here are the networks it supports: Binance Smart Chain, Polygon, xDai, Fantom Opera, Arbitrum One, Avalanche, Optimism, Moonriver, Moonbeam. Additional network support is planned for Fuse, Celo, Aurora, Harmony, Evmos, Neon, Godwoken, zkSync, and StarkNet.

Transactions happen in three phases:

Auction: The user requests a preferred route. Routers answer with bids that include commitments to finalize the transfer within a specified time window and within a stated price range.

Preparation: After the auction ends, the transfer is set up. The user submits a transaction to the TransactionManager contract on the sending network, including the router’s signed bid. This locks the user’s funds on the source side. When the router observes an event carrying the signed request, it sends the same transaction to the TransactionManager on the destination network and locks the correct amount of liquidity there. The amount locked on the receiving network equals the sent amount minus the commission, so the router is compensated for completing the transfer.

Execution: once a TransactionPrepared event is detected on the receiving network, the user signs the message and transmits it to the repeater, which receives a sending fee. The repeater (typically another router) then sends a message to the Transaction Manager to complete the user’s transaction on the destination network and retrieve the funds that were locked by the router.

If the transfer is not finished within a set validity period, it is cancelled and the initiating user can revoke it. Also, a party that is owed funds on that network may cancel transactions unilaterally before they expire.

Benefits:

High level of trust: The blocking mechanism ensures routers cannot disappear with users’ assets. Connext Non-Castodial Transfer Protocol (NXTP) is the only generalized interoperability approach that depends on its own validators. Solutions using external validators are inherently less secure, since users must trust third-party verifiers regarding their methods and data.

Scalability: When bridges verify using the network’s own validator set, trust guarantees improve further. At the same time, each network pair has to be built separately, which limits how quickly new support can be rolled out compared with liquidity networks. Connext can onboard new blockchains to its ecosystem, enabling faster expansion into other environments.

Capital Efficiency: Bridges require validators to lock collateral to supply services, which is inefficient. That collateral needs to grow with the bridge’s economic bandwidth. With liquidity networks like Connext, there is no fixed ceiling on economic bandwidth that the network can safely support, because capital locking is not connected to their security model and happens directly at the sender and receiver side of the network, not at the validators.

Superior UX: Since validation occurs locally on liquidity networks, cross-network transfers complete quickly. Connext also supports real-time L2-to-L2 transfers and helps users bypass extremely high fees.

Rebalancing liquidity with arbitrage incentives

Crosschain volume is a major growth metric for liquidity networks, but large flow in one direction quickly empties liquidity on the other side.

To address this, Connext estimates liquidity through an AMM curve, behaving like stable-swap AMMs such as Curve. Asset pricing moves based on how much liquidity is available on each network. Greater imbalance leads to larger price differences and a stronger effect on the price of the resulting asset.

In other words, users pay more to receive assets from the more liquid network and pay less to receive assets from the less liquid network.

This creates attractive arbitrage opportunities for market makers that already benefit from AMM mechanics like those in Uniswap. With Connext’s virtual AMMs, cross-chain arbitrage becomes possible as well.

Connext currently has $11 million in liquidity and delivers $31 million in weekly volume.

Development using the SDK

Connext is a foundational protocol, comparable to TCP/IP, that lets you perform basic tasks such as inter-network transfers and contractual interactions. The project targets developers who can use the SDK to build their own applications. Over time, the protocol can evolve toward more advanced communication across networks, depending on what other tools are available and how different networks interoperate. The first product created with the Connext SDK is the bridge https://xpollinate.io/.