The ApeCoin community recently made headlines with the launch of ApeChain, a highly anticipated Arbitrum Orbit L3. In less than a month, the rollup has attracted over $90M in TVL and is growing rapidly. Many experiments are already underway on the chain, from memecoins to NFT drops and DeFi. More than just a massive validation of the rollup-centric vision for Ethereum, this launch was captivating for those of us deep in the Ethereum scalability/rollup trenches. The unique feature set underneath ApeChain combines several ‘industry firsts’ that make the network differentiated and compelling to both builders and users. In this blog, we want to give an insider look into what makes the ApeChain stack and its feature set stand out and how it may offer a roadmap for other rollup builders.

Like all Arbitrum Orbit L3s, ApeChain's underlying infrastructure was designed from the ground up to deliver high throughput and low fees. In true web3 fashion, a genuine collaboration between teams at Arbitrum, LayerZero, Caldera, Decent and Yuga Labs resulted in a one-of-a-kind feature set that will pave the way for the next generation of rollups. ApeChain introduces two industry firsts:

• Day 1 interoperability with all LayerZero-supported chains
  
  

• Automatically rebasing native yield on primary assets

Native Interoperability with LayerZero OFTs

Interoperability is crucial for all rollup networks, especially a new one. Without it, chains can feel like isolated islands, forcing users to rely on complex and costly bridging mechanisms to reach them. With ApeChain, we didn't want to let the lack or cost of bridging dissuade a user from participating in the vibrant ApeCoin ecosystem. By upgrading ApeCoin (an ERC-20 token) with LayerZero's Omnichain Fungible Token (OFT) standard, ApeCoin can now natively exist across all LayerZero-supported blockchains, ensuring smooth, low-cost cross-chain transfers and eliminating liquidity constraints from day one.

LayerZero’s integration with Arbitrum Orbit allowed us to take this one step further by enabling ApeCoin (now an OFT) to function as the native gas fee currency for ApeChain. 

To implement this, our engineering team built an OFT adaptor to wrap ApeCoin and deposit it into ApeStake whenever the OFT version is minted on any supported chain. This approach avoids liquidity requirements, which are often the biggest bottleneck in scaling interoperability solutions for a rollup. In addition, we pre-minted the OFT token to ensure full collateralization of the native bridge on ApeChain and the base chain, providing a secure and reliable bridge experience for users.  

Native Yield

Liquidity flows wherever it can earn the highest yield. The ApeCoin team recognizes this and was determined to provide users with a clear incentive to bridge to ApeChain from day one. Alongside Decent, our team at Caldera added native yield on bridged assets to achieve this. With native yield, ApeChain users can earn passive income on their assets — including ApeCoin, ETH, and stablecoins like USDC, USDT, and DAI — without lifting a finger.

Users who bridge their assets into ApeChain automatically earn yield on those assets through a rebasing mechanism. Every so often, users will notice their wallet balances growing as the yield accumulates. There’s no need for users to interact with complex DeFi protocols or manually stake their assets; native yield happens seamlessly in the background.

To implement this, the Decent engineering team built an extension of the LayerZero OFT to implement out-of-the-box native yield on stablecoins (APE-USD) and ETH (APE-ETH). These tokens are tied to vaults earning yield from sources like Lido for ETH and Sky Savings Rate for stablecoins. As these tokens automatically rebase, users see their token balances increase over time without manual intervention.

Caldera’s implementation focused on extending APE’s functionality to generate yield. By modifying Go-Ethereum (Geth), we added additional fields to the state account object to track the yield generated per account. Additionally, we created a hook that automatically distributes yield to all accounts each time a new block is mined.

This feature isn’t just a perk for users; it also benefits rollup builders. By offering built-in yield on day one, rollup chains can attract more liquidity and incentivize users to stay within their ecosystem. Additionally, DAOs like the ApeCoin DAO can use this feature to generate revenue by collecting a portion of the yield from bridged assets.

Examples: Blast and Edgeless

Other chains like Blast and Edgeless have already implemented variations of the native yield concept with great success. For instance, Blast offers a fixed APR on ETH and stablecoins, with a rebasing mechanism that adjusts token balances to reflect earned yield. Edgeless, on the other hand, uses a lottery system to redistribute yield back to users and protocol developers.

These examples demonstrate the versatility of the native yield feature and show how rollup builders can tailor it to meet their specific goals, whether it’s user retention or funding ecosystem development.

Why does this matter for rollup builders?

The combination of Arbitrum Orbit’s stack, LayerZero’s OFT standard, and Caldera and Decent’s native yield feature represents a powerful toolkit for rollup builders. By integrating these features into their rollups, builders can:

• Ensure native interoperability from day one, attracting liquidity and users without the typical friction of cross-chain transfers.
  
  

• Offer users passive yield on their assets, creating a strong incentive to deposit and hold funds on their chain.
  
  

• Tailor the yield mechanism to fit the specific needs of their chain, whether through automatic rebasing, a community pool model, or other distribution methods.

As more rollups seek to differentiate themselves in an increasingly competitive space, offering interoperability and native yield on day one is a massive advantage. By following in the footsteps of ApeChain, rollup builders can create feature-rich ecosystems that are attractive to users and developers alike.

Rollup builders looking to stand out in a crowded market should consider ApeChain’s underlying tech stack and innovative feature set. By combining these powerful tools, they can build the next generation of scalable, user-friendly blockchains that offer unparalleled utility at launch.

Interested in deploying your own rollup with Caldera? Get in touch with us.

About Decent

Decent connects your rollup to every other chain. It provides chains with out-of-the-box bridge interfaces to onboard users, and equips developers in your ecosystem with a comprehensive set of APIs and components to offer chain abstracted transactions in their apps.

About LayerZero

LayerZero is an interoperability protocol that connects blockchains (90+ and counting), allowing developers to build seamless omnichain applications, tokens, and experiences. The protocol relies on immutable onchain endpoints, a configurable security stack, and a permissionless set of executors to transfer censorship-resistant messages between chains. 

About Arbitrum

Arbitrum is a technology suite designed to scale Ethereum. Arbitrum chains can be used to do all things that are done on Ethereum - use Web3 apps, deploy smart contracts, etc., but the transactions will be cheaper and faster. Their flagship product - Arbitrum Rollup - is an optimistic rollup protocol that inherits Ethereum-level security.

About Caldera

Caldera is one of the fastest-growing rollup ecosystems on Ethereum, empowering web3 teams to launch high-performance, customizable, application-specific rollups. Dozens of leading EVM chains, including Manta, ApeChain, Kinto, Injective, RARI Chain, and Zero Network by Zerion, use our trusted Rollups-as-a-Service platform to enjoy unified connectivity with rollups across all leading frameworks. 

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