# Ethereum Foundation Unveils Open Intents Framework

The Ethereum Foundation announced the Open Intents Framework (OIF) on February 20. This framework, developed in collaboration with over 30 teams, aims to make asset transfers between blockchains easier and more efficient. As various blockchains emerge, users face increasing inconvenience navigating between multiple networks, making this breakthrough a focal point of interest.

# Rising Importance and Necessity of Intents

Layer 2 (L2) solutions have aimed to enhance Ethereum’s scalability. However, critics argue that these have not captured Ethereum’s full value. For instance, Arbitrum, which charges a 10% fee on its L3 platform, pays only a 2% fee to the Ethereum L1 network. This exemplifies the structural issue where L2s are linked to the Ethereum network but do not contribute directly to ETH’s economic value.

A more pressing issue is the rapid growth of competing chains like Solana, which is weakening Ethereum L2’s relative position. According to L2BEAT data, major L2s saw a 5% decline in Total Value Locked (TVL) in early February 2024, indicating decreasing liquidity. If these issues remain unresolved, L2s risk being relegated to mere transaction cost-saving tools, further weakening the link to ETH value accretion.

# Intensifying Blob Competition in L2 Storage

Another challenge facing Ethereum L2 is blob storage competition. Currently, Ethereum provides only three blobs per block, and all L2s vie for this limited space. Dominant L2s like Base, Arbitrum, and Optimism occupy most of the blob space, leading to high transaction costs for new L2s.

Gauthamzzz, co-founder of polynomialfi, noted that 55% of the total blob space is being used by a few L2s. If this issue persists, the L2 ecosystem could face severe capacity issues by May 2025. The blob storage problem is exacerbating imbalances among L2s and accelerating liquidity fragmentation, highlighting the need for a solution like the Open Intents Framework.

# What is the Open Intents Framework?

The Open Intents Framework is designed to facilitate smoother blockchain transactions. Traditionally, users had to navigate multiple steps to transfer assets directly. With the OIF, users merely set an “intent,” and the system identifies and executes the optimal transaction path. For example, a user wishing to convert 100 USDC on the Base chain to 100 USDT on the Arbitrum chain can input this intent, and the system handles the trade automatically. The framework is open-source and offers various functionalities to easily integrate with blockchain developers.

## ERC-7683 Standard Support

ERC-7683 defines a standard for intent creation, execution, and settlement, improving cross-chain user experience. The Ethereum community widely supports this standard, and the OIF includes a reference implementation utilizing ERC-7683.

## Open-Source Solver Implementation

Solvers monitor on-chain events and process intents. The OIF provides an independent solver codebase, enabling flexible and non-dependent expansion of the intent system.

## Modular Smart Contracts

Pre-built smart contracts based on ERC-7683 define the intent execution and settlement logic. These contracts support limit order swaps and Hyperlane settlements by default and allow the addition of various settlement mechanisms.

## User-Friendly UI Templates

The framework offers intuitive interfaces to help users easily create and manage intents.

# ERC-7683 and Uniswap’s Role

A key technology behind the Open Intents Framework is the ERC-7683 standard, designed to simplify cross-chain transactions. This standard is actively supported by major projects like Uniswap.

Uniswap, a decentralized exchange (DEX), utilizes ERC-7683 to facilitate smoother transactions across multiple blockchains. Uniswap V4 introduces a centralized liquidity model to reduce gas costs, while Uniswap X enhances cross-chain capabilities by potentially integrating with ERC-7683.

Adopting this technology could lead to the emergence of automated market makers (AMMs) for cross-chain transactions, enabling users to trade with lower fees and higher speed.

# Challenges Ahead

Despite its potential to revolutionize cross-chain transactions, the OIF faces several challenges. Key issues include differentiating itself from existing cross-chain solutions and managing the transition to ERC-7683.

## Competition with Existing Cross-Chain Solutions

The OIF needs to offer features distinct from existing solutions like LayerZero, Axelar, and Wormhole. These existing solutions have already advanced cross-chain messaging and bridging technologies. The speed at which OIF gets adopted is crucial, as LayerZero emphasizes multi-chain connectivity while Axelar prioritizes enhanced security. To stand out, the OIF must refine transaction optimization and automated execution systems.

## Adoption and Implementation Speed of ERC-7683

While the ERC-7683 standard plays a critical role in unifying cross-chain transactions, the pace at which existing bridges and cross-chain protocols adopt it remains uncertain. Current bridges operate under their own systems; thus, without compulsory adoption, the spread of ERC-7683 could be slow. Additionally, how aggressively essential protocols besides Uniswap embrace ERC-7683 will be pivotal.

## Security and Scalability Concerns

Cross-chain transactions are inherently vulnerable to hacking and security threats. To establish a secure cross-chain environment, the OIF needs bespoke solutions for security enhancement. Achieving decentralized trustworthiness without centralized validation nodes is a key challenge.

# Collaborative Efforts are Essential

Despite these challenges, achieving a unified experience in the Ethereum ecosystem necessitates open collaboration and standardized infrastructure. Ethereum co-founder Vitalik Buterin emphasized the importance of cooperation, stating, “When we build together, we win together.” The role of the Open Intents Framework in the broader blockchain ecosystem remains a topic of keen interest.