With the rise in new projects in the cryptocurrency industry, many are created to build upon existing technology to increase user adoption. However, following this direction may lead to oversaturation of the industry, with multiple projects competing for user bases and liquidity while offering the same features and products.

Amidst all this, a new Arcana Network project seeks to follow a different path. It focuses on significantly improving the user experience by providing abstraction-led features. These features include a decentralized authentication service, sponsored gasless transactions, and even the ability to send crypto via email.

What is Arcana Network?

Source: arcana.network

Arcana Network is a web3 platform tailored for developers seeking solutions to launch and scale decentralized marketplaces, social apps, and gaming ecosystems. It provides features such as instant web wallet widgets, user onboarding with emails and social login, as well as decentralized network-generated non-custodial wallets.

Arcana Network operates as a software-as-a-service solution that offers an SDK to build web3 apps seamlessly. With this platform, developers can securely authenticate users’ identities, store sensitive information, and utilize various decentralized finance (DeFi) services.

This project acts as a privacy-focused infrastructure layer for web3, offering developers a robust set of tools for building secure, scalable, and privacy-preserving dApps. This is evident in Arcana Network’s main authentication service, Arcana Auth, which is designed to overcome the limitations of conventional authentication methods.

Arcana’s primary goal is to enable developers to enhance their dApps’ user experiences by utilizing its authentication services and financial features. Instead of investing significant time in developing their own systems, developers can seamlessly integrate Arcana’s tested-and-trusted user experience into their projects. Ultimately, Arcana aims to establish itself as the leading UX and authentication provider within the web3 community.

History of Arcana Network

Arcana Network was founded in 2021 by Mayur Relekar, the CEO and co-founder, and Aravindh Kumar, an AIESEC alumnus with a background in SaaS entrepreneurship. Other key members of the team include Ajay Shetty, the Chief Operating Officer, Abhishek Chaudhary, the Chief Technology Officer, Sharan Grandigae, the Chief Design Officer; and Anirudh Venu, the Product Manager.

Since its launch, the company has partnered with over 100 organizations, such as Dappgenie, Intract, MetaOasis, and Acknoledger. Its main product (Arcana Auth) has also been deployed across over 2,000 apps, including Hashcase, Fandora, Dygnify, and Safient, and has accumulated over 21,000 SDK downloads. The project has amassed significant support from the cryptocurrency industry, raising up to $2.3 million in its seed round, led by Republic Crypto and Woodstock Fund, and featuring other investors such as Digital Currency Group (DCG), LD Capital, Paradigm Shift VC amongst others.

How Does Arcana Network Work?

Arcana Network is powered by Validium, an Ethereum scaling solution that securely stores off-chain data. This integration allows Arcana Network to handle customer data in a secure, off-chain location to speed up transaction processing and reduce gas fees. The data is then encrypted and sent back to Ethereum for verification. After the transaction is complete, Arcana’s software then sends the outcome to the appropriate dApp.

Additionally, the Arcana blockchain employs a proof-of-stake consensus mechanism, where validators are selected to propose blocks based on the amount of tokens they staked. These validators run pools that token holders can delegate tokens to in exchange for staking rewards. As a security-oriented project, Arcana uses the Istanbul Byzantine Fault Tolerant (IBFT) algorithm to reward honest validators and punish malicious nodes by slashing their staked tokens.

Account abstraction is also an integral part of Arcana Network’s structure. It involves storing crypto assets in smart contracts instead of the conventional externally owned accounts (EOAs). These EOAs usually rely on private keys for authentication and transaction signing, and as such the user’s assets will be at risk if these keys fall into the wrong hands. Using account abstraction enables better features like social login, password recovery and gasless transactions, ultimately improving user experience.

Arcana Network also features a Multi-Party Computation (MPC) network, which creates different node sets for different use cases, improving the project’s decentralization. The MPC network can also sign transactions alongside user signatures, thus increasing transaction throughput.

The project also leverages an innovative solution called Intents, which enable users to focus on the transactions they want rather than how to achieve them. For new users, navigating the crypto space might be full of technicalities that may be cumbersome to overcome. Intents solves this issue by handling the nitty-gritty of the transaction for the user.

For example, let’s say a user wants to sell ETH and buy BTC. Instead of the traditional route of selecting exchanges and reviewing the best option in terms of speed, cost, and value, the user can simply use an Intent to place their order differently. They can say, “Sell my 1 ETH so I can get at least 0.40 BTC while keeping the fees under 0.003 ETH,” while the solution handles the rest.

Moreover, Arcana customers can pay for transactions in fiat currency or stablecoins, with bills generated based on transparent usage logs. Payment methods include credit cards and whitelisted stablecoins. If a transaction is paid for with a credit card, Arcana uses a fiat-to-crypto on-ramp to convert the money into one of the whitelisted stablecoins.

Main Features of Arcana Network

Arcana Network is home to various innovative products. Some of these include:

Arcana Auth

Source: arcana.network/auth

Arcana Auth, launched in February 2023, is an authentication service designed for dApps to verify user identities effortlessly. It offers an SDK that seamlessly integrates with apps and facilitates user onboarding through various methods such as social login, IAM providers, and passwordless login.

Moreover, Arcana Auth provides a plug-and-play social login feature for smooth user onboarding. The main difference between a plug-and-play social login and the traditional method is that with the traditional social login, the user is redirected to the social media platform to authenticate their account, while plug-and-play login enables the user to authenticate their account directly from the application through APIs.

Arcana Auth also equips users with non-custodial wallets in the app. These wallets empower users to sign transactions and manage their digital assets within the app without the need for additional plugins.

SendIT

Source: sendit.arcana.network

SendIT is an innovative platform that simplifies the way people send and receive cryptocurrency. It allows users to send crypto via email or Twitter handles, eliminating the need for recipients to have a specific wallet address. This process is secure and gives full ownership to the recipient.

The product was made public in December 2023 and has gained massive popularity, with over 500,000 users and 3 million transactions facilitated.

When a sender confirms a crypto transaction to the recipient’s email or Twitter handle, a new wallet address is automatically created and associated with the recipient’s details. The received crypto can then be accessed using this wallet address after authentication.

To use SendIT, users need to log into the Arcana network using their Google, Twitter, or other supported authentication details. They also need to have assets in their Arcana wallet. Whitelisted users with empty wallets will receive Polygon Mumbai Testnet MATIC tokens.

Source: sendit.arcana.network/#how-does-it-work

After logging in, users can use the SendIT app to initiate crypto transactions. Once the transaction is confirmed, they can send an email to the recipient containing the SendIT link to claim the received crypto. For transactions exceeding $1 on selected mainnet chains, SendIT automatically sends an email.

To receive crypto via email or Twitter, the sender shares the SendIT link displayed in the app after confirming the transaction. The recipient is then notified of the blockchain transfer via email and can use the link to claim the crypto by logging into the SendIT app using the same email or Twitter handle.

Upon receiving crypto on SendIT, recipients are automatically whitelisted for SendIT usage and can share crypto with others using any wallet address through the Arcana wallet UI.

Gasless

Source: arcana.network/gasless

Gasless is a system created for developers to eliminate the stress of dealing with gas fees for its users. With Gasless, developers can sponsor gas fees for their dApp users, enabling them enjoy the ease of utilizing their dApp without any hassle. As such, users don’t have to hold or purchase any native tokens, complete a KYC verification process, or sign up to any particular exchange before using a blockchain application.

Gasless is easily customizable, and developers can run promotions that cover the gas fees of the first 100 buyers of a particular token to help create a sense of urgency for other users to buy the token. Developers can also have different gas tanks for different chains, enabling them cater to each chain’s users. They can also cover the gas fees for only specific types of transactions.

When the gas tank has been emptied (i.e there are no funds left to sponsor gas fees), Gasless continues allowing the users pay the gas fees themselves without any hitches. Developers can also withdraw their deposited funds at any time.

With Gasless, developers can control not only which kinds of transactions can be sponsored, but also the people who can receive the sponsorship. As such marketing budgets can be effectively tailored to reach the target audience directly.

Arcana Chain Abstraction

Source: arcana.network

Arcana Network Chain Abstraction was unveiled in June 2024 as a modular L1 architecture to enable users to send and spend any crypto token while having a unified balance across blockchains. Similar to Arcana Auth’s abstracted wallets and Gasless’ account abstraction, Arcana’s chain abstraction protocol is a user-centric protocol that will eliminate the complexities of dealing with gas fees and accounts across hundreds of blockchains.

The blockchain industry is saturated with dozens of projects competing for users and liquidity. This increase in chains leads to three major problems: user experience inefficiency, developer inexperience inefficiency, and capital inefficiencies.

With user experience inefficiency, sending crypto from one chain to the other would most likely require the user to convert their crypto assets to the receiving chain’s native token or sign up to an exchange that the receiving chain is partnered with before they can successfully transfer their assets. The same thing can be said for developer experience inefficiency, as developers would have to customize their dApps using different SDKs of different projects before achieving enough interoperability to scale their products.

When it comes to capital inefficiency, according to an article by Everclear, for every dollar bridged into a chain, $0.80 is bridged out. This results in greater gas fee charges and more time spent bridging funds already available. As such, there is far more liquidity than needed to be bridged into chains, and far more bridging transactions are done than are needed.

Arcana’s chain abstraction protocol will solve all three issues. It will grant the user a unified balance showing their aggregate funds across the wallets they connect. The user will also be able to spend the balance on any chain without bridging any other chain or holding gas tokens for any specific chain.

Developers can also choose blockchains based on their technology and business requirements without chasing liquidity and users across different blockchains. It will also solve capital inefficiency by providing seamless support for new chains and tokens by liquidity pools.

What is XAR?

XAR was launched on April 3rd, 2024, and is the native token powering the Arcana network ecosystem. It is an ERC-20 token serving as a governance token and a transaction fee payment. In its fundraising round, the project received up to $4 million, which, combined with its $25 million valuation, highlights its high potential and investors’ belief in its success.

Token holders can also stake their tokens to earn passive income on their assets. Users can stake their tokens for 30 days at a 40% annual percentage yield (APY), 60 days at 50% APY, and 90 days at 60% APY.

Early investors can start selling their tokens from the token generation event (TGE) in the next 18 months. This will help provide early liquidity to the market. Investors who participated in the seed and extension rounds would also be eligible to sell their tokens after the TGE, but they can only do so over 18 months.

Arcana Network’s team shares a different schedule. They won’t be able to sell tokens for the first 12 months after the TGE, but they can sell gradually over the next 36 months. This shows their commitment to the network’s long-term success.

The tokens allocated to the ecosystem will be activated at the TGE. 10% will be released immediately to support the platform’s development; the rest will be released over 24 months. Reserve tokens will be released after 12 months and distributed across 36 months to provide stability and capital for future development.

Advisors will receive their tokens immediately after the TGE to show a long-term commitment, and the distribution will end after 22 months.

XAR Tokenomics Explained

Source: arcana.network/token

XAR has a total supply of 1 billion tokens, with a current circulating supply of 89 million tokens and a market cap of $2.4 million. The token was distributed as follows:

• 2.5% was set aside for the pre-seed round
• 3.8% was allocated to the seed round
• 15.4% was reserved for private use
• 3% went to Arcana’s IDO
• 31% was allocated to incentivize ecosystem growth
• 18% was kept in the reserves
• 6.4% was distributed to advisors
• 20% was reserved for the Team

News on XAR

On July 24th, 2024, Arcana Network announced its partnership with Nubit, a Bitcoin-native data availability layer. This partnership aims to combine the expertise of both projects in chain abstraction and Bitcoin-native data availability to improve Bitcoin’s functionality and accessibility.

Nubit’s data availability involves using a Data Availability Sampling (DAS) protocol to ensure data integrity for its clients. The DAS verifies block data presence through random sampling without downloading the entire block. Repeated successful samples increase confidence in data availability and will be validated.

Specifically, Arcana’s Chain Abstraction will be made available to Nubit’s BTC L2 ecosystem of partners, enabling seamless cross-chain interactions without the need for bridging between chains.

Additionally, Arcana Auth will be integrated into user-facing Nubit products such as Bitomni, Meson.fi, and Gate Web3 Wallet via its SDK. This will offer users a seamless login experience with robust security features and various login methods, including social authentication, email, and OTP.

Arcana Network also has a few updates for the third quarter of 2024. These include its validator onboarding, Arcana Auth SDK V2 launching, Developer Grants Program, and chain abstraction wallet testnet.

Is XAR a Good Investment?

Arcana Network stands out as a breakthrough project in user identification and authentication. It also provides abstraction features for blockchains, developers, and users to ease their challenges in cryptocurrency and usher in a new era of blockchain interaction. However, it must be noted that the crypto market remains volatile. As such, users are advised always to do research or consult qualified financial personnel before investing in any project.

Take Action on XAR

XAR is available for trading on popular exchange platforms like Gate.io. Click here to view and trade your favorite pairs.

• XAR/USDT

Useful References

For the latest updates on Arcana, you can visit:

• Website
• Whitepaper
• Twitter
• LinkedIn
• Telegram