Axelar: Everything to Know

By  Beluga Research August 15, 2023

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  • Axelar is a decentralized protocol connecting blockchain networks, enabling seamless cross-chain communication and interoperability
  • It was founded in 2019 to address the need for a protocol connecting different blockchains and gained funding from prominent venture capital firms
  • The Axelar Network Routing Protocol (ANRP) enables seamless interoperability between blockchains, ensuring secure and efficient transactions
  • It faces challenges such as complexity, security risks, adoption hurdles and performance considerations.


Axelar is a decentralized protocol connecting blockchain networks, enabling seamless cross-chain communication and interoperability. It is a blockchain-agnostic network designed to enable seamless communication and interoperability across multiple blockchain platforms. Its primary objective is to address the fragmentation and lack of interoperability that exist in the current blockchain ecosystem. By facilitating cross-chain communication, Axelar aims to unlock the full potential of decentralized applications (dapps) and enable a more connected and efficient blockchain ecosystem.

A Brief History

Axelar was founded in 2019 by Sergey Gorbunov and Shahan Khatchadourian, who recognized the need for a protocol that could effectively connect different blockchains. The project quickly gained attention and secured funding from prominent venture capital firms, including Polychain Capital and Initialized Capital.

Axelar: Everything to Know

At its core, Axelar utilizes a unique technology called the Axelar Network Routing Protocol (ANRP) to enable interoperability between disparate blockchain networks. ANRP acts as a bridge, allowing different blockchains to communicate and transfer value seamlessly. This protocol ensures that transactions are executed securely, reliably and efficiently.

Axelar's network is powered by a native utility token called AXR. The token serves as a means of exchange within the ecosystem and provides incentives for network participants. AXR holders can stake their tokens to secure the network, participate in consensus and earn rewards.

One of the key features of Axelar is its decentralized application (dapp) infrastructure. Developers can leverage Axelar's tools and APIs to build cross-chain applications that can interact with multiple blockchain networks simultaneously. This opens up a world of possibilities for developers, enabling them to create innovative solutions that were previously hindered by the lack of interoperability.

Axelar also prioritizes security and privacy. The platform employs various cryptographic techniques to ensure the confidentiality and integrity of transactions and data. By leveraging zero-knowledge proofs and other privacy-enhancing technologies, Axelar enables users to transact with confidence while maintaining their privacy.

Moreover, Axelar aims to provide a seamless user experience by abstracting the complexity of interacting with different blockchains. Users can easily transfer assets between different networks without having to worry about the underlying technical details. This user-friendly approach is crucial in driving mass adoption and making blockchain technology more accessible to the general public.

Getting Started

To get started with Axelar, users can interact with the protocol through its native token, AXR. AXR serves as a utility token within the Axelar network, facilitating various functions such as governance, staking, and securing the network. Users can acquire AXR tokens through cryptocurrency exchanges or participate in the network's token distribution events.

To utilize Axelar's cross-chain capabilities, developers can integrate the protocol's software development kit (SDK) into their applications. The SDK provides a set of tools and libraries that enable seamless interaction with different blockchain networks. By leveraging the SDK, developers can access a wide range of cross-chain functionalities, including asset transfers, data sharing, and smart contract execution across multiple blockchains.

Unique Aspects

Axelar offers several unique aspects that differentiate it from other cross-chain solutions. Firstly, the protocol employs a decentralized delegation model, allowing users to delegate their assets and transactions to validators who secure the network. This approach enhances the overall security and decentralization of the protocol, as it relies on a distributed network of validators rather than a single central authority.

Furthermore, Axelar utilizes a novel technology called "inter-chain messaging protocol" (IXP) to enable secure and efficient communication between different blockchains. IXP ensures that messages are delivered reliably and in a verifiable manner, facilitating the seamless transfer of assets and data across disparate blockchain networks. This technology is designed to be blockchain-agnostic, meaning it can be implemented on various blockchain platforms, making Axelar compatible with a wide range of networks.

Axelar also incorporates a unique economic model that incentivizes participants to contribute to the network's security and stability. Validators are rewarded with AXR tokens for their role in validating transactions and securing the network, while users who delegate their assets to validators can earn a share of the rewards. This incentivization mechanism encourages active participation and ensures the integrity of the network.


  • Enhanced Interoperability: Axelar provides a standardized framework for interoperability between various blockchains, allowing assets and data to flow seamlessly. This enables developers and users to leverage the strengths of different blockchain networks without being limited to a single platform.
  • Scalability: The protocol's design incorporates a scalable and efficient architecture, ensuring that interoperability can be achieved at a large scale. By utilizing a decentralized network of validators, Axelar can handle a significant volume of transactions while maintaining security and reliability.
  • Cross-Chain Asset Transfers: Axelar facilitates the transfer of assets across different blockchain networks. This capability opens up new possibilities for decentralized finance (DeFi), allowing users to access and utilize assets from various chains in a trustless manner. It also enables the creation of more complex applications that span multiple blockchains.
  • Decentralized Governance: Axelar employs a decentralized governance model where stakeholders can participate in decision-making processes. This ensures that the protocol evolves in a transparent and community-driven manner, reducing the risks associated with centralized control.
  • Privacy and Security: Axelar prioritizes privacy and security by utilizing advanced cryptographic techniques. It enables secure communication and asset transfers while preserving the confidentiality of sensitive information. This aspect is crucial, especially when dealing with cross-chain transactions involving multiple parties.


  • Complexity: Interoperability protocols like Axelar involve intricate technical mechanisms, making them more complex to understand and implement than single-chain solutions. This complexity may pose challenges for developers who need to integrate the protocol into their applications. Additionally, it may require a higher level of technical expertise to operate and maintain the infrastructure supporting the protocol.
  • Potential Security Risks: While Axelar aims to enhance security, any protocol that enables cross-chain communication introduces potential security risks. The interaction between different blockchain networks may expose vulnerabilities that could be exploited by malicious actors. Continuous security audits and robust testing are essential to mitigate these risks effectively.
  • Adoption Challenges: Like any new technology, Axelar may face adoption challenges as it strives to gain traction in the cryptocurrency and blockchain space. Widespread adoption requires collaboration and integration with existing blockchain networks, which may be hesitant to embrace interoperability solutions due to concerns about compatibility, security, or competition. Overcoming these challenges will be crucial for Axelar's long-term success.
  • Performance Considerations: Interoperability protocols often introduce additional layers of complexity that can impact performance. The need to validate transactions across different chains and maintain consensus may result in slower transaction processing times compared to single-chain solutions. Balancing performance and interoperability will be a key challenge for Axelar and similar protocols.