Key Takeaways: Unichain aims to be the ultimate DeFi liquidity hub across all chains, while a super app is being developed to capture the value generated by the protocol itself.

Built on the OP Stack, Unichain offers three major innovations:

• Verifiable Block Building: Developed with Flashbots, this feature enables faster transaction processing, minimizes MEV risks, and safeguards user transactions.
• Unichain Verification Network: Solves the centralization risk of a single sequencer by introducing “verifiable sequencing” and quicker economic finality.
• Intent-Driven Interaction Model: Users only need to focus on their intentions. The system will automatically choose the best route for cross-chain transactions, eliminating the complexity of cross-chain execution.
• This super app enables tokens to capture the protocol’s unique value through the creation of an application chain.

Research Report

1/5 · Verifiable Block Building

Unichain’s Verifiable Block Building process relies on Rollup-Boost, developed in cooperation with Flashbots. It mainly addresses three issues:

• Reducing MEV risk
• Increasing transaction speed
• Offering rollback protection to prevent users from paying high fees for failed transactions

How It Works

1. Unichain separates the roles of block construction and sequencing. The Verifiable Block Builder, running in a secure Trusted Execution Environment (TEE), is responsible for building blocks. TEE is a protected hardware environment that ensures programs can be executed without revealing internal data while providing verifiable proof that the rules have been followed. This allows anyone to verify that block building is legitimate.
2. The Flashblocks pre-confirmation mechanism ensures that a set of transactions is pre-confirmed before being included in a block. Each block is divided into smaller Flashblocks, which reduces block processing time to 200-250 milliseconds—much faster than most current rollups. Transaction ordering within each Flashblock is enforced in the TEE, meaning users and applications can see the execution order transparently, reducing unfair advantages caused by MEV.
3. TEE also provides Trustless Revert Protection by simulating transactions during the block-building process. This detects and removes transactions likely to fail, preventing users from paying fees for failed transactions.

In summary, Unichain enhances verifiability by separating block building from sequencing and using a transparent TEE environment. It also improves transaction efficiency and reduces MEV risks. Additionally, the introduction of a pre-confirmation mechanism allows users and applications to know in advance which transactions will be included in the block, followed by final confirmation after the pre-confirmation window passes.

Pre-confirmation accelerates the block confirmation process, but it is not the same as final confirmation. It means that before transactions are packaged into the final block, users can know in advance that these transactions will be included, which helps reduce transaction latency.

The whitepaper mentions that the expected block time for Flashblocks is 200-250 milliseconds. This means that Flashblocks can pre-confirm transactions within this timeframe. However, the actual final confirmation takes more time, as the blocks will eventually need to be merged with other blocks and undergo state updates and submissions to ensure the consistency of the entire chain’s state.

Therefore, the pre-confirmation window is theoretically manageable, and its length directly impacts the user’s transaction experience and the risk management of liquidity providers. A shorter time window means faster transaction confirmation, but it may also lead to higher technical requirements and network pressure. Overall, the pre-confirmation window is designed to balance transaction speed and network security.

2/5 · Unichain Validation Network

UVN (Unichain Validation Network) is Unichain’s decentralized validation system, designed to solve the potential risks of a single-sequencer architecture. It combines Flashblocks and Trusted Execution Environments (TEE) to achieve “verifiable sequencing.”

How It Works

1. Validators are node operators in the UVN system, and they need to stake UNI to become validators. Each validator is entitled to participate in the validation process and receive rewards based on the amount of UNI staked.
2. Unichain blocks are divided into fixed-length epochs. At the beginning of each epoch, a snapshot is taken of the total amount staked by all validators, and rewards are calculated based on the staked tokens. Validators with the highest UNI stake weight are selected into the active validator set, and these validators have the right to participate in block validation during the current epoch.
3. Active validators must stay online to verify blocks proposed by the sequencer.
4. Validators verify each proposed block, generate a hash signature for the block, and publish it to the UVN’s service smart contract, which verifies these signatures and distributes rewards based on the validator’s stake weight. If a validator fails to validate a block within an epoch or signs an invalid block, they will lose their rewards for that epoch and may face penalties on their staked tokens.

In summary, the risk of a single sequencer is mainly reflected in block uncertainty, unfair transaction ordering, and the negative impact on network security and fairness due to centralization.

The market has seen solutions like introducing decentralized sequencers with incentive and penalty mechanisms, such as Metis. Unichain, on the other hand, combines decentralized validation (UVN) and transparent sequencing (verifiable block building) to offer both validation capability and public transparency in sequencing, mitigating the problems caused by centralization. Each approach has its characteristics, with trade-offs in terms of efficiency, cost, and security.

One common issue is that a single sequencer has control over transaction ordering and can decide which transactions are packaged into blocks first. This power allows the sequencer to extract maximum extractable value (MEV), by reordering transactions or inserting their own transactions to profit from others’ transactions.

3/5 · Intent-Driven Interaction Model

The whitepaper mentions an intent-driven cross-chain interaction model (ERC-7683: Cross Chain Intents), where users’ transaction needs are converted into executable “intents,” and the system automatically selects the optimal path to execute these intents, without users having to manually operate across multiple blockchains.

For example, a user can submit an intent to transfer 100 USDC from Unichain to the Ethereum mainnet to buy an NFT. The intent-driven model will automatically recognize this intent and choose the best path to complete the cross-chain interaction. This design allows the cross-chain process to be automated and decentralized without relying on trusted intermediaries, reducing the risk of third-party dependency and manual operations. It also achieves the ultimate goal of chain abstraction – separating blockchain complexity from the user experience. Users only need to focus on their own needs and intents, solving the problems of liquidity fragmentation and disjointed cross-chain interaction experiences.

4/5 · Ultimate Goal – Becoming the DeFi Liquidity Hub

Unichain has chosen the OP Stack ecosystem, leveraging the native interoperability of Superchain to deeply integrate with mainstream L2s like Base, Mode, OP Mainnet, etc. Within these chains, Unichain can easily utilize the intent-driven model.

For chains outside the OP ecosystem, the standardized design of ERC-7683 allows Unichain’s intent-driven model to interact with other non-OP Stack chains. This is achieved through standardized interfaces and smart contract structures (such as the CrossChainOrder and ISettlementContract interfaces). As long as different chains follow this standard, or certain cross-chain bridges are compatible with this standard, they can parse and process cross-chain intents and participate in Unichain’s cross-chain order execution process.

Ultimately, Unichain aims to become a crucial connection point in the all-chain DeFi ecosystem, providing users with broad and fast liquidity access.

5/5 · UNI’s Value Capture

Based on current information, $UNI will serve as the collateral for validators in the UVN validation network and will be rewarded. Its value capture may come from several aspects:

1. Potential activation of transaction fees (this has been a long-debated topic and has yet to be activated, facing regulatory pressures among others)
2. Blockchain node staking rewards (validators complete node validation and receive block rewards)
3. MEV capture and distribution: Unichain, based on the UVN validation network and verifiable block building, has control over transaction sequencing, enabling significant MEV capture. This also includes MEV generated by intent-driven cross-chain transactions (for example, by optimizing the execution path of cross-chain orders to ensure orders are completed at the lowest cost and highest return). These MEV values are distributable, potentially rewarding users or being shared among validators staking UNI.
4. Cross-chain interaction fee capture: Unichain’s ultimate goal is to become the DeFi liquidity hub, and the key to achieving this goal is ERC-7683. It enables seamless interaction between multiple chains’ liquidity, approaching the effect intended by chain abstraction. The cross-chain transactions and intent-driven interaction model require the participation of fillers and validators to complete transactions. These roles can earn revenue from order fees or settlement fees when processing cross-chain orders and settlements.

ERC-7683

Compared to regular L2s, Unichain’s additional value capture lies in points 3 and 4. Before Unichain’s launch, MEV generated by Uniswap was captured by Ethereum validators and L2 sequencers. With the launch of Unichain, this value will shift to Unichain. Cross-chain interaction fees will depend on Uniswap’s transaction volume across chains, and whether the smooth interoperability of multi-chain transactions can lead to growth in trading volumes. Fees previously incurred through cross-chain bridges will now flow directly into Unichain itself. (Of course, the above does not take into account potential governance value and future ecosystem growth, which are unpredictable factors.) This is a unique way for a super app to recapture the value created by the protocol itself by building an application chain.

Disclaimer:

1. This article is reposted from @cmdefi. Copyright belongs to the original author [@cmdefi]. If there are any objections to this repost, please contact the Gate Learn Team, and the team will handle it as quickly as possible according to the relevant process.
2. Disclaimer: The views and opinions expressed in this article are solely those of the author and do not constitute any investment advice.
3. Other language versions of this article were translated by the Gate Learn team. Without mentioning Gate.io, no translated articles may be copied, distributed, or plagiarized.