ETH and USDC pools on Cronos zkEVM

ETH and USDC Pools on Cronos zkEVM This governance proposal aims to enhance cross-chain connectivity for Stargate users by creating ETH and USDC Pools on Cronos zkEVM, the layer 2 Elastic Chain launched by Cronos in the summer of 2024.

To minimize the effort by the Stargate DAO, Cronos Labs will fund the pools on Cronos zkEVM, starting with $1 million each for ETH and USDC for at least 12 months, to be upsized as needed, depending on user demand.

The proposal seeks to:

Facilitate ETH and USDC bridging: Enable seamless transfer of ETH and USDC between Cronos zkEVM and other supported chains via Stargate.

About Cronos zkEVM Cronos zkEVM is the first Elastic Chain (layer 2) launched in mainnet after ZKSync Era. It was launched in the summer of 2024 as a collaboration between Cronos and engineering teams from Matter Labs (one of the contributors to ZKsync), Crypto.com, VVS Finance, Fulcrom Finance, and Veno Finance, as well as more than 20 launch partners.

Cronos (cronos.org) is a leading blockchain ecosystem that has partnered with Crypto.com and more than 500 application developers and contributors, representing an addressable user base of more than a hundred million people worldwide. Cronos’ mission is to unlock the future of finance for everyone, making it easy and safe for communities to adopt self-custody and web3, focusing on Decentralized Finance and Gaming, and with AI agents as the new interface between users and the network.

Cronos ranks among the top 15 blockchain ecosystems, encompassing over 6 billion US dollars of user assets. Since its inception, it has securely settled more than 150 million transactions. It encompasses 3 chains:

Cronos zkEVM, a new high-performance layer 2 network secured by Ethereum, built on ZKSync technology (focus of this proposal); Cronos EVM, the leading Ethereum-compatible blockchain built on the Cosmos SDK; and Cronos POS, a top Cosmos chain for payments and NFTs. Cronos zkEVM is secured by the Ethereum mainnet. It shares a native Ethereum bridge, secured by Ethereum too, with over 10 other Elastic Chains, including ZKSync Era. All canonical tokens on Cronos zkEVM, such as ETH and USDC, are secured by Ethereum since 100% of the token supply on the layer 2 network is backed by a corresponding ETH and USDC balance locked in the ZKSync bridge contract on Ethereum (currently here).

Cronos zkEVM and Cronos EVM are both in the process of being supported by Layer Zero endpoints (mainnet and testnet).

Motivation By integrating Stargate, the Cronos ecosystem aims to enhance its end-user experience significantly in terms of cross-blockchain token bridging. It also seeks to encourage the vibrant ecosystem of dapp developers of Cronos chains to leverage the underlying Stargate technology (especially Hydra tokens) for their cross-chain use cases, even for user experiences not supported by the Stargate front end.

Cronos is deeply connected with the Cosmos SDK ecosystem, since Cronos EVM is the leading EVM-compatible blockchain built on the Cosmos SDK and compatible with IBC (Inter Blockchain Communication). As for Cronos zkEVM, it shares its bridge and zero-knowledge proof system with the aggregated liquidity of the entire Elastic Chain ecosystem (ZKSync).

This governance proposal is therefore part of a comprehensive initiative to integrate both Cronos EVM and Cronos zkEVM with Stargate, enabling cross-blockchain connectivity between the networks already supported by Stargate, the Elastic Chain ecosystem, and the Cosmos SDK ecosystem.

Proposal To facilitate end-user adoption of Stargate by Cronos users, Cronos Labs will fund the pools on Cronos zkEVM, starting with $1 million each for ETH and USDC for at least 12 months, to be upsized as needed, depending on user demand.

Cronos Labs plans to fund the pools for the foreseeable future. To manage day-to-day fluctuations, incentives should be provided to the pools as per SIP23.

From a security standpoint, it is essential to keep in mind that the supply of ETH and USDC on the Cronos zkEVM layer 2 network is backed by a corresponding ETH and USDC balance locked in the ZKSync bridge contract on Ethereum (currently here), shared by ZKSync Era, Cronos zkEVM, and more than 10 other Elastic Chains.

Thanks to the layer 2 design, holders of ETH and USDC can withdraw their assets at any time from the Cronos zkEVM network, including by signing transactions on the layer 1 network itself (Ethereum).

Marketing and Community Engagement To encourage Stargate adoption by Cronos users, and by users of partners such as Crypto.com (particularly via the self-custodial Crypto.com Onchain wallet), Cronos Labs will work with Stargate to launch a series of quests encouraging the use of Stargate for cross-chain transfers.

Stargate is already integrated with the self-custodial Crypto.com Onchain wallet.

Additionally, links to the Stargate front-end will incorporated into the official Cronos bridge portals available respectively at cronos.org/bridge for Cronos EVM and zkevm.cronos.org/bridge for Cronos zkEVM.

Additionally, Cronos Labs will encourage the developer ecosystem to use Stargate and Layer Zero technology for their cross-chain use cases.

Execution Upon community approval, the Stargate ETH and USDC pools will be deployed on Cronos zkEVM, and funded by Cronos Labs.