LayerZero
LayerZero is a cross-chain interoperability platform that enables developers to create decentralized applications (dApps) that work seamlessly across multiple blockchains through a straightforward and uncomplicated interface. LayerZero was founded by Caleb Banister, Bryan Pellegrino, and Ryan Zarick in 2021 and is headquartered in Vancouver, British Columbia, Canada. [1][2][3]
Overview
LayerZero is a messaging protocol, not a blockchain. It facilitates seamless interaction between blockchains using smart contracts on each chain, Decentralized Verifier Networks (DVNs), and Executors. Implemented on January 29th, 2024, LayerZero V2 separates message verification and execution, giving developers more control over security and execution. It also offers enhanced message throughput, programmability, and other contract-specific improvements, making it a more flexible and efficient messaging protocol. [12]
The update includes Decentralized Verification Networks (DVNs), which replace the V1 Oracle and allow any entity capable of verifying cross-chain data packets to join LayerZero, promoting decentralization. Adapters for Axelar and CCIP DVNs are available on testnet and will be on mainnet at launch, with additional adapters planned for 2024 to support various native bridges, third-party bridges, middle chains, oracles, and other verification methods, preventing vendor lock-in. The X of Y of N Verification feature provides a modular approach, enabling applications to customize their security by choosing a combination of DVNs, thus optimizing costs and security levels based on specific needs. [12]
Permissionless Execution introduces Executors, a new role that handles execution on the destination chain separately from verification, simplifying gas payments and offering customizable gas settings. Each application must configure a Security Stack comprising DVNs, Executors, chain confirmations, MessageLibraries, and chain pathways, granting full control over security settings. Increased throughput is achieved by offering lazy or strict nonce enforcement options, allowing developers to choose between in-order or out-of-order transaction execution, thereby aligning LayerZero’s throughput with the destination chain’s while maintaining censorship resistance. [12]
Enhanced programmability is facilitated by improved protocol contract interfaces, path-specific libraries, new design patterns, and horizontal composability, fostering flexibility and uninterrupted cross-chain transactions. Unified semantics ensure that applications function uniformly across all blockchains with LayerZero endpoints, including non-EVM chains. Finally, the V2 launch supports forward and backward compatibility, aiding teams building on V1. [12]
Ultra-Light Node
Ultra Light Node (ULN) is a novel cross-chain bridging and messaging approach. ULN combines the security of on-chain light nodes with the cost-effectiveness of middle chains. On-chain light nodes receive and validate every block header for each pairwise chain on the opposing chain, making it the most secure way to transmit messages between chains, but it comes with a high cost. Middle chains, on the other hand, are less secure but more cost-effective. [4]
ULN solves this dilemma by performing the same validation as an on-chain light node, but instead of keeping all block headers sequentially, block headers are streamed on demand by decentralized oracles. This eliminates the need for a node to store every block header, reducing the storage and computational overhead and making it a more cost-effective solution. The oracles are incentivized to provide accurate and reliable block headers, ensuring the security of the messages transmitted between chains. [4]
Infrastructure of LayerZero
Omnichain Mesh Network
LayerZero addresses the limitations of existing cross-chain networks, which often suffer from sparse connectivity and inconsistent communication interfaces, by providing a uniform and densely connected mesh network across all supported blockchains. An Omnichain Mesh Network allows any chain to communicate with any other chain directly using a predictable and stable interface, facilitating seamless data and value transfer across blockchains. The LayerZero protocol maintains consistent security and reliability across all connections, despite varying security semantics and design logic among individual blockchains. [15]
The network ensures uniform standards for packet delivery, reliable data transfer without censorship, and packets are delivered exactly once to their intended destinations. LayerZero's modular security model offers configurable and non-configurable security guarantees, allowing developers to choose the security and cost-efficiency models that best fit their applications. Decentralized Verifier Networks (DVNs) verify messages and can be configured by applications, while configurable block confirmations protect against block reorganizations on the source chain. Core security features, such as protection against censorship, replay attacks, and unauthorized code changes, are built into the network's immutable interfaces. [15]
The network recognizes that each pathway might require a different security configuration. Pathways, defined by source blockchain, source application, destination blockchain, and destination application, can be individually configured to tailor security and cost to the specific needs of each connection. This chain-agnostic approach enables developers to create Omnichain Applications (OApps) that operate seamlessly across blockchains. [15]
Endpoints
The LayerZero Endpoint is an immutable smart contract providing a standardized interface for Omnichain Applications (OApps) to manage security configurations and send and receive messages seamlessly. A LayerZero Endpoint is divided into four modules: Communicator, Validator, Network, and Libraries. The Communicator, Validator, and Network modules make up the core functionality of the endpoint, while new chains are added as additional Libraries. This design allows for easy support of new chains without modifying the core modules. [3][17]
Utility
LayerZero is a blockchain infrastructure that provides a range of utilities to developers and users. Its key features include a cross-chain decentralized exchange, multi-chain yield aggregator, and multi-chain lending. These utilities allow for seamless transfer of native assets across different chains, access to high-yield opportunities, and cost-efficient lending options. [17]
Cross-Chain Decentralized Exchange
LayerZero facilitates a cross-chain decentralized exchange (DEX) that operates solely with native assets. Unlike traditional DEX designs that use wrapped tokens or go through intermediary sidechains, LayerZero enables DEXs with liquidity pools on both chains, allowing users to deposit their native assets on one chain and withdraw native assets from another. With LayerZero's messaging capabilities, direct bridges, automated market-making, and other pricing models can be implemented. [17]
Multi-Chain Yield Aggregator
When using LayerZero for cross-chain transactions, a multi-chain yield aggregator could tap into the high-yield opportunities across multiple ecosystems, maximizing access to high-yield opportunities and allowing users to take advantage of market inefficiencies. This would be an improvement over single-chain yield aggregators that restrict their access to yield opportunities outside of their current ecosystem and instead would provide more yield opportunities to choose from. [17]
Multi-Chain Lending
Multi-chain lending on LayerZero allows users to take advantage of opportunities on different chains while consolidating their assets on their preferred chain. Through a lending protocol, users can lend their assets on their preferred chain and borrow the desired asset directly on another chain, eliminating the need for costly intermediary steps like bridge and swap fees. [17]
Omnichain Fungible Token (OFT) Standard
LayerZero's Omnichain Fungible Token (OFT) standard is a framework for creating tokens that can be transferred across multiple blockchains while maintaining a single, unified supply. [25] [26] Unlike traditional cross-chain bridges that "wrap" tokens—creating a separate, synthetic version on the destination chain—the OFT standard utilizes a burn-and-mint mechanism. When a user transfers an OFT, the token is burned on the source chain, and an equivalent amount is minted on the destination chain. This process avoids the liquidity fragmentation and security risks associated with wrapped assets. [25] [27]
The OFT standard is particularly advantageous for stablecoins, as it helps maintain their peg and ensures consistent liquidity across different ecosystems. By eliminating wrapped tokens and the need for liquidity pools in transfers, it avoids slippage and price inconsistencies between chains. [25] Issuers also retain control over their assets, as their own smart contracts manage the mint-and-burn logic. They can also configure their own security through Decentralized Verifier Networks (DVNs). [27]
A key example of this adoption is PayPal's stablecoin, PYUSD. In November 2024, PYUSD integrated the OFT standard to enable seamless transfers between Ethereum and Solana. [27] This allows PYUSD holders to move their assets between the two networks without relying on centralized platforms or third-party bridges. The cross-chain transfers are secured by a DVN chosen by the issuer, Paxos, which includes verifiers like Google Cloud and LayerZero Labs. [27] [25]
In June 2025, Skate, a project focused on creating a unified multi-chain execution ecosystem, integrated Stargate's LayerZero OFT for its native SKATE token. This integration allows the SKATE token to move across multiple blockchains, including Ethereum, Arbitrum, and Solana, enhancing its liquidity and accessibility for dApp interoperability. The use of the OFT standard ensures that transfers are cost-effective and have zero slippage. [26]
The OFT standard has seen further adoption by major players in the stablecoin and tokenized asset space. In January 2025, Tether partnered with LayerZero to launch USDT0, a cross-chain version of its USDT stablecoin using the OFT standard. This version debuted on Kraken's layer-2 blockchain, Ink, and is designed to unify liquidity across multiple networks. [28] The standard was also adopted for tokenized Bitcoin when BitGo, the custodian for Wrapped Bitcoin (WBTC), chose LayerZero as its interoperability provider in September 2024 to expand WBTC to chains like BNB Chain and Avalanche. [29] Additionally, tokenized real-world asset protocol Ondo Finance used the OFT standard to launch its yield-bearing stablecoin, USDY, on networks including Solana in November 2024, making it fungible across different blockchain ecosystems. [30]
LayerZero Airdrop
On June 14, 2024, the LayerZero team introduced the 'LayerZero Foundation' and also, Bryan Pellegrino, the CEO of LayerZero Labs, released his calculations on the ZRO token airdrop in a tweet on X; [18]
Ok let's talk some numbers.23.8% of the supply is going directly to the community and builders. This does not include foundation, growth, etc. Directly to community. 8.5% of this is being distributed day 1 (5% core, 3% RFP, 0.5% community pool) The majority of the remainder will be given over the next 36 months with additional retroactive distribution every 12 months, along with some forward looking RFPs for builders.... - he tweeted on June 14, 2024 [13]
Per the tweet, ZRO has a supply of 1 billion, of which 23.8% is reserved for allocation to community and builders. 23.8% excludes foundation, growth, and other heads. 8.5% of the tokens allocated to the community and builders will be distributed on the first day of the airdrop; the rest will be allocated within three years. The project plans an additional allocation every 12 months, and some forward-looking Request for Proposals (RFPs) will be provided for builders in the ecosystem. [14]
LayerZero Labs also mentioned June 20 as the airdrop date for the token while asking users to determine their eligibility status via the official website. [19]
Partnerships
- Google Cloud
- Polyhedra
Funding
On April 1st, 2021, LayerZero raised $2 million as their first-ever seed funding round. [2][20]
On September 16th, 2021, LayerZero's series A funding round, led by Binance Labs and Multicoin Capital, raised $6 million. Additional investors included Sino Global Capital, Defiance, Delphi Digital, Robot Ventures, Spartan, Hypersphere Ventures, Protocol Ventures, Gen Block Capital, and Echelon Capital. [2][5]
On March 20th, 2022, LayerZero's series B funding round was led by a16z, FTX, and Sequoia, raising $135 million. Some of the main investors included Coinbase Ventures, PayPal Ventures, Tiger Global, and Uniswap Labs. [6][7]
Pudgy Penguins
On January 26, 2023, Pudgy Penguins, a hand-drawn penguin NFT collection project, partnered with LayerZero to allow the transfer of their NFT across different chains. Pudgy Penguins chose to work with Polygon, BNB Smart Chain, and Arbitrum due to their growing usage and exposure. Polygon was selected for its ability to attract new users to the Web3 community, BSC was chosen for its low gas fees and commitment to inclusivity, and Arbitrum was chosen for its suitability for DeFi development. By bridging Pudgy Penguins NFTs to any chosen chains, users will receive a SoulBound token as a commemorative souvenir tied to their wallet. This partnership between Pudgy Penguins and LayerZero enables the project to make it easy for new Web3 users to become part of the ecosystem without worrying about high gas fees, offering both "provenance and user experience". [11][21]
Initia Labs
On July 10th, 2024, LayerZero and Initia partnered to develop an interoperability standard for Cosmos, enabling Cosmos SDK-based chains to connect to LayerZero-enabled chains for omnichain interoperability. [16]
Stargate Acquisition
In August 2025, LayerZero acquired the cross-chain protocol Stargate for $110 million. [23] The acquisition followed a competitive bidding process where LayerZero's offer was chosen over proposals from several rivals. [22]
The bidding war saw interest from other major interoperability protocols. Wormhole submitted a competing bid of $120 million in USDC, which was $10 million higher than LayerZero's offer. [23] [22] Additionally, Axelar Network and Across Protocol signaled their interest in acquiring Stargate, though the process moved forward with LayerZero's proposal. [22] [24]
The acquisition was approved by the Stargate community DAO in a vote where 95% of participants favored the deal. [23] [22] Following the vote, the Stargate DAO was officially dissolved. [23] This acquisition brought Stargate, which was originally developed and launched by LayerZero in 2022, back under its control, aligning the bridge's future development with LayerZero's strategic vision. [22]
Team
Leadership Team
- Head of Research: Daniel P. Ahn
- Head of Strategy: Max Glassman
- Head of Talent: Richard Dietrich [8]
Executive Team
- Co-Founder and CEO: Bryan Pellegrino
- Co-Founder and CTO: Ryan Zarick
- COO: Ari Litan [9]
Board of Directors
- Angel Investor: Rob Sadow [10]