Painting the Interchain Canvas with PICA: Explore the Multi-Chain Possibilities
Published:03. May 2024.
Composable Finance is moving the borders with its latest connection to Ethereum, and soon we could expect an IBC connection to Solana. This will bring all new possibilities and opportunities. At the centre of this is the PICA token, a catalyst that connects Cosmos, Polkadot, Ethereum and soon Solana.
This article explores the current capabilities unlocked by these connections and the forthcoming advancements on the horizon.
Disclaimer: This information is not financial advice. Its purpose is to showcase the potential applications of the PICA token and the benefits of these IBC connections. If you plan to utilize any mentioned products, conduct thorough research before proceeding.
What you can do with PICA at this moment?
PICA offers intriguing options. Stake your PICA tokens to earn additional rewards. If you’re optimistic about PICA’s potential, you can borrow more tokens. Alternatively, provide liquidity and receive a share of trading fees.
Staking PICA
By staking PICA, you secure the network and earn more tokens. The current staking APR is around 8%. Additionally, you’ll receive a portion of the fees generated from Inter-Blockchain Communication (IBC) token bridging.
Every staker receives 20% of the fees generated via bridging. Revenue from bridge transfers gets distributed to stakers once monthly. If you are unsure how to stake you can use our guide https://cogwheel.zone/how-to-buy-bridge-and-stake-pica/
Earning fees from transactions on the Decentralized Exchanges
Earning fees from trading is possible by providing assets to liquidity pools. Additionally, you may receive extra tokens if these pools offer incentives. Currently, a few decentralized exchanges (DEXes) support PICA: Osmosis, Pablo, Uniswap, and Shade.
Osmosis
Osmosis is the largest DEX within the Cosmos ecosystem, offering a diverse range of assets. It features a PICA/OSMO pool with an approximate 60% APR at the time of writing. Compared to other DEXes, Osmosis currently holds the highest liquidity for the PICA token. As for other assets that go thorugh Composable Finance on the Osmosis and their future plans we will discuss it down below more.
Pablo
Pablo is a DEX on Picasso Network which is home to both Cosmos and Polkadot assets. There are a lot of tokens paired with PICA and current APR varies a lot from 0 to 15%. While there is no currently much activity on the DEX maybe in the future we will see more activity when assets from Solana and Ethereum reaches the DEX but this is only speculation and only the time will tell how this will go.
Uniswap
PICA token has landed recently on the Ethereum Network on Uniswap DEX. And this is just the beginning. Currently, the only pool that exists is PICA/ETH. More assets will be onboarded in the future.
Shade
People who value privacy may find Shade Decentralized Exchange (DEX) attractive. Shade is a DEX built on the Secret Network. It uses the SNIP standard which enables private transactions, confidential smart contract interactions, and interoperable assets via Inter-Blockchain Communication (IBC). If these features interest you, you can put your PICA tokens to use by contributing to the SHD/PICA liquidity pool. You can earn a 20% APR in SHD tokens. For detailed steps on using this DEX, refer to their documentation: https://docs.shadeprotocol.io/shade-protocol/
Lease PICA from Nolus
Do you feel the need to borrow PICA but you do not know how to get it? It is possible by using the Nolus Protocol. Nolus is a DApp that allows you to borrow and lend assets. And you can place PICA as a down payment to get a lease for a token of your choice. Or it could go the other way around. You could place a token as a down payment and lease PICA.
What is on the horizon?
IBC to Solana
We could expect the IBC to Solana to be live soon for the public. At this moment Composable is onboarding validators. For now, you can use the restaking platform https://games.mantis.app/solana-staking/. Season 1 for Mantis is about to end with 35 million PICA, and 4 million BLAZE in rewards for the users that staked on the restaking platform, but the team has something stored for season 2. More info about this can be looked up here: https://medium.com/picasso-network/conclusion-of-mantis-games-season-1-introduction-of-mantis-credits-10c1c24febd1
Connecting Solana with IBC will bring numerous advantages. Cosmos, Polkadot, Kusama and Ethereum ecosystems will have a connection with the chain that is the fourth largest chain in terms of TVL and holds the fifth spot in the market capitalization. Solana will gain an IBC bridge which has been battle-tested multiple times and compared with many existing bridges this is trustless.
As for any current partnerships and integrations with projects on Solana, there are a couple that have been made in the past:
https://twitter.com/Picasso_Network/status/1757506709000434074
https://twitter.com/Picasso_Network/status/1752801497824293215
https://twitter.com/Picasso_Network/status/1752414144618226168
https://twitter.com/Picasso_Network/status/1757104016616575485
https://twitter.com/Picasso_Network/status/1757104016616575485
https://twitter.com/Picasso_Network/status/1755671038686306371
https://twitter.com/Picasso_Network/status/1783136199407812979
And hopefully, we can expect more integrations in the future. To learn more about IBC Solana check for more info here: https://blog.cosmos.network/ibc-is-live-on-solana-launched-as-an-avs-on-picassos-restaking-hub-c16b7d5f8ad7
Ethereum, first IBC rollup and Osmosis as a IBC Ethereum Liquidity Hub
IBC connection to Ethereum has been achieved recently and more is coming. Composable Finance and Osmosis have partnered to make Osmosis a hub for all of assets sent from Ethereum via IBC through Composable Finance.
Osmosis, the leading appchain and DeFi hub in the Cosmos ecosystem, has been chosen as the primary liquidity destination. This strategic decision leverages Osmosis’s robust and flexible liquidity pools and innovative DeFi offerings, providing Ethereum users with novel access to Cosmos’s thriving DeFi landscape — and vice versa. The integration not only enhances the liquidity of both ecosystems but also opens up new avenues for yield generation, cross-chain trading, and decentralized financial products that were previously unachievable. (https://medium.com/picasso-network/osmosis-selected-as-primary-liquidity-and-defi-hub-for-ethereum-assets-on-cosmos-7e88cd2c4714)
FRAX has partnered with Picasso to have its L2 Fraxtal which will be the first Picasso IBC rollup.
Fraxtal, the Layer 2 solution from FRAX, is advancing into the future of blockchain interoperability by becoming one of Picasso’s first IBC Rollup Partners. This move showcases FRAX’s commitment to enhancing its DeFi ecosystem through the integration with IBC, aiming to merge Fraxtal’s efficient L2 solutions with seamless cross-chain capabilities. The partnership will allow asset transfer between FRAX’s L2 and other IBC-compatible blockchains, boosting interoperability, low fees, and cross-chain liquidity. Stay tuned how this technical innovation will progress and lead to the first big steps between Ethereum L2s and IBC. (https://medium.com/picasso-network/ibc-ethereum-launch-frax-finance-4a14d7ff3eb1)
As per the partnership with Osmosis, there will be an introduction of these pools: sFRAX/USDC, sfrxETH/USDC, and FXS/OSMO.
