ConsenSys Partners with Palm on New Bridge Feature
The Palm network is an Ethereum sidechain dedicated to selling, purchasing, and trading NFTs. The Palm NFT Studio has collaborated with artists like Damien Hirst, DC, Niftys, and Warner Brothers to mint NFTs on the Palm network. The network has low gas costs and is 99.9% more energy efficient than Proof of Work-based blockchain networks.
ConsenSys Protocol Engineering has an ongoing partnership with Palm to build and improve the official Palm bridge, which allows users to move between the Ethereum and Palm networks. An exciting thing about Palm is that in addition to moving funds, users can transfer NFTs over the bridge. As a user, I can buy an NFT on Palm and bridge it to Ethereum to sell it to a broader market.
We’re thrilled to announce an even better user experience for the Palm bridge! Our teams have collaborated to automatically update bridge fees based on market conditions, which makes bridging faster and more fair for NFT collectors and traders.
When users bridge tokens or NFTs from Palm to Ethereum, they pay a bridge fee to cover gas on Ethereum. This fee needs to be updated frequently based on two factors:
- Gas price on Ethereum, which is highly volatile.
- ETH/DAI conversion rate: The bridge fee is denominated in DAI, whereas the Ethereum gas price is in ETH. Because of this, the bridge fee needs to update based on this fluctuating conversion rate.
Before this release, updating the bridge fee was a manual process, where Palm would need to calculate and adjust the fee on a regular basis to reflect actual cost. This was a time consuming process for the Palm team, and could only be done on a weekly(ish) basis. This resulted in two problems for end users when fees weren’t updated quickly enough:
- If the bridge fee is higher than the actual cost, the user may overpay.
- If the bridge fee is lower than the actual cost, the user may underpay, which means their transaction was delayed. Palm would need to cover the additional costs to push the transaction through.
The bridge is designed to be cost neutral, so we knew we needed a more consistent and accurate way to update this fee. However, calculating the right fee is not so straightforward, as prices on Ethereum can change wildly over a very short period of time.
With automated fee updates, the bridge fee now updates every three3 hours. The fee calculation is based on the gas cost over the last 72 hours and the average ETH/DAI exchange rate over the last seven7 days, to smooth out momentary spikes that may occur. Check out Palm’s blog post for more details on the implementation, and a huge shoutout to Ricardo Silva for leading development for this feature.
Automated bridge fees have been live in production for two weeks, and we’ve seen great feedback so far. Bridge fees from Palm to Ethereum are much more fair and consistent, and transfers are less likely to get delayed. Plus, the Palm team no longer has to manually update fees or resubmit transfers that don’t have enough gas. We’re working with Palm on even more fee improvements to enable better and less expensive bridging in the future, so stay tuned.