About Hop Protocol (HOP)

Hop is a multi-chain asset bridge that facilitates that instant transfer of digital assets between independent layer 2 solutions, sidechains and EVM compatible blockchain networks.

The project has a native token, HOP, used to confer voting rights within the protocol’s governance-controlling DAO.

Ethereum’s high gas fees gave rise to layer- 2/sidechain solutions, such as Polygon, Optimism and Arbitrum.

While each of these projects provide an effective means of scaling the Ethereum mainnet, transferring tokens between individual layer-2s, and the applications that run on them, can be a bit of a tricky ordeal.

Imagine you’re a DeFi user interested in a new yield farming opportunity on the Polygon network but your tokens are currently staked in a Uniswap liquidity pool powered by Optimism. Usually in that case the yield-hunter would first be forced to transfer their assets off Optimisms’ layer-2 and onto the Ethereum mainnet. A weeklong waiting period would then ensue before the Ethereum-based tokens could be sent to Polygon.

Hop addresses this by leveraging a series of ‘bonders’ to instantly swap assets between scaling solutions. In exchange for a 0.02% tokenized fee, bonders front users with intermediary “h” tokens which are then immediately swapped for the canonical (native) asset on the destination chain via an automated market maker.

At a high level, the process requires users to send assets to the bonder on the source chain and the bonder to send tokens to the user on the destination chain. The bonder fronts the user with funds as the corresponding “h” tokens move through the system’s plumbing, AAX Academy explained.

According to project documentation, Hop Protocol relies on a decentralized base of dispositors to provide the liquidity needed to instantly swap “h” assets for their canonical counterparts. Like other decentralized token pools, depositors receive a cut of its transaction fees to compensate for lost liquidity.

As of June 2022, Hop Protocol was one of Ethereum’s more prolific asset bridges, with over 47,000 unique users worldwide.

When was HOP created and how much was it worth?

Hop Protocol is the brainchild of three experienced DeFi-builders,Shane Fontaine, Miguel Mota and Christopher Whinfrey, who initially devised the project in March of 2021.

The project officially went live three months later on July 12,, 2021.

 Since launch, the protocol has integrated with Optimism and Polygon among other layer-2/sidechain solutions.

Per Whinfrey’s Medium page, both he and Fontaine had previously worked together on Authereum, a since discontinued Ethereum accessibility platform.

Hop’s native asset, HOP, was first distributed via an airdrop to eligible wallet addresses on June 9th, 2022. At that time the token was valued around $0.19.

According to CoinGecko briefly hit a record high of $0.21 on June 10, 2022, before losing over 50% of its value over the next three days.

How is the price of HOP determined?

HOP is a deflationary asset with a hard cap of 1 billion tokens. According to the project’s Twitter feed, 80 million HOP – 8% of total supply – was airdropped to eligible wallet addresses in June of 2020. An additional 60.5% of supply currently resides in the Hop treasury, while some 224.5 million tokens will be dished to the project’s founders and early developers over the next three years.

Why does HOP have value?

Hop’s ability to instantly transfer assets between independent layer-2 solutions and sidechains underscores its value proposition.

Is HOP secure?

According to Publish0x.com, Hop Protocol is only as strong as its weakest sidechain/layer 2 solution it supports. Given the high-quality nature of Hop’s layer 2 partnerships, all of which are secured by the Ethereum mainnet, users should be confident in the security of their assets. 

What are the main benefits of HOP?

• Hop protocol enable funds to be transferred between independent layer- 2/sidechain scaling solutions.
• The project is one of Ethereum’s more prolific multi-chain asset bridges with 47,000 unique users globally.
• The protocol’s native token, HOP, confers voting rights in the Hop DAO.

What do the critics say about Hop?

• Steep criteria – only those who had sent more than $1,000 between chains and made more than two transactions were classified as bridge users ahead of the airdrop – filtered out many bridge users from the release.