Cross-Chain Transfer Protocol
Cross-Chain Transfer Protocol (CCTP) is a permissionless on-chain utility that can burn native USDC on a source chain, and mint native USDC of the same amount on a destination chain. Developers can embed CCTP into their apps and provide users with the most capital efficient way to transfer USDC across chains – unifying liquidity across the ecosystem and simplifying user experience.
CCTP eliminates the need to use a conventional “lock-and-mint” bridge, which otherwise would lock native USDC on the source chain – incurring a potential security risk – and then mint a synthetic/bridged version of USDC on the destination chain, which results in fragmentation of liquidity and poor UX.
CCTP is exposed through smart contracts, which are designed to allow composability of additional functionality beyond just burning and minting native USDC. For example, a developer could build a flow where a user can transfer USDC across chains and deposit the newly-minted USDC into a DeFi protocol to begin generating yield -- which could be designed to feel like one seamless transaction to the user.
How does it work?
- Burn USDC on the source chain: A user accesses an app to initiate a transfer of USDC from one blockchain to another, and specifies the recipient wallet address on the destination chain. The app facilitates a burn of the specified amount of USDC on the source chain.
- Fetch signed attestation from Circle: Circle observes and attests to the burn event on the source chain. The app requests the attestation from Circle, which provides authorization to mint the specified amount of USDC on the destination chain.
- Mint USDC on the destination chain: The app uses the attestation to trigger the minting of USDC. The specified amount of USDC is minted on the destination chain and sent to the recipient wallet address.
Example use cases
Developers can leverage CCTP to build novel cross-chain apps that stack together the various functionalities of trading, lending, payments, NFTs, gaming and more – all while abstracting complexity away from users.
Users can perform cross-chain swaps with digital assets that live on distinct chains (e.g. ETH on Ethereum for AVAX on Avalanche). In a completely automated way, ETH can be swapped for USDC on Ethereum, routed by CCTP to Avalanche, and swapped for AVAX. Routing and execution is abstracted from the user, delivering a seamless UX.
Enable users to use USDC on Ethereum to open a position on a decentralized exchange on Avalanche. Because CCTP can route USDC across chains behind the scenes, the user never needs to switch wallets or even think about which chain they’re holding USDC on.
Purchase NFTs across chains
With one-click, a user with USDC on Avalanche can buy an Ethereum-based NFT on Uniswap and list it for sale on OpenSea. When the user initiates a transaction from their MetaMask wallet, CCTP routes their USDC from Avalanche to Ethereum to purchase the NFT from Uniswap, and then opens the listing on OpenSea.
CCTP is available today on Goerli testnet for Ethereum and Fuji testnet for Avalanche.
- Q1 2023: Ethereum mainnet and Avalanche mainnet
- 2023: Solana and additional chains
Updated 2 months ago