Mission Statement

What are the meanings of meta-transaction and cross-layer agent and what is the role of Nether on future Ethereum vision?

Nether believes in Ethereum and EVM (Ethereum Virtual Machine) and its decentralization value regarding other L1s in the blockchain ecosystem, and is aware of the importance of ETH as a medium of exchange in the upcoming era. Being the Schelling Point through the concept of world computer makes Ethereum, the most valuable and trustless chain, in parallel we believe it could become too scarce to be used as gas cost to execute transactions across underlying layers.

Unfortunately, the high submission of Ethereum Network usage, increases gas cost and makes the native chain inaccessible for greater amount of late web3 users. The cost of a transaction to write down data on chain becomes beyond reach for mass adoption. Hence, it brings a highly promising solution called roll-ups or L2s to overcome to the problem of high gas costs and accelerate mass adaption to complete Ethereum’s narrative to stepping up as the "World Computer".

The term of Layer 2 is a collective term for solutions designed to help scale decentralized applications by handling transactions off the Ethereum Mainnet (Layer 1) while taking advantage of the robust decentralized security model of Mainnet. Security is the most crucial variable when comparing decentralization and trust, between the other alternatives in the blockchain ecosystem.

Currently, Ethereum Network uses POW (Proof of Work) as a consensus layer and ensures its high-level security, but in the near future, Ethereum migrates itself to POS (Proof of Stake) as a consensus layer to ensure security and decrease the computational power of the network that is being used to execute on-chain transactions.

As Nether Team, we believe that, while staking native ETH coins on the Mainnet will determine the network security, there is going to be an ETH scarcity in the long run and it brings an unprojected problem for L2s that utilize ETH to execute network transactions. To give a boost to the Mainnet security, Nether’s protocols provide synthetic and algorithmic token called NETH to substitute of the native coin and to serve as the cross-layer liquidity solution of the entire L2 ecosystem, via implementing bridge function to the token itself for meta-transaction.

In short; A meta-transaction is a regular Ethereum transaction which contains another transaction, the actual transaction. The actual transaction is signed by a user and then sent to an operator or something similar; no gas and blockchain interaction required. Nether takes this signed transaction and submits it to the blockchain paying for the fees himself. The forwarding smart contract ensures there is a valid signature on the actual transaction and then executes it for the user’s behalf.

One of the primary shortcomings of past algorithmic tokens has been a lack of use cases for users who want to use or hold them. In order to successfully maintain the peg, in the long run, the Nether Team will maintain a focus on partnerships and collaborations for being used as a transaction token for the entire L2 ecosystem.