Canopy Network is a shared security protocol that creates a network of interoperable L1s, minimizing startup costs and maximizing developers' flexibility. It introduces the first auto-scaling L1 ecosystem, featuring a self-organizing security hierarchy that adapts to evolving demands, providing unparalleled protection and flexibility. Canopy eliminates bootstrapping costs and vulnerabilities for Canopy L1 applications at the earliest stages, while fostering an environment for value capture as L1 applications mature. This ‘idea to independence’ journey made possible by Canopy creates a fertile ground for developers to quickly and simply launch new L1-based applications without the risks of bootstrapping their own independent chain or lock-in to existing systems.
In its purest form, Canopy’s protocol is an incentive layer for stakers to validate a wide variety of independent, yet interconnected blockchains. Canopy introduces incentive alignment across its ecosystem by creating a restaking layer for those blockchains. Stakers opt-in to various chains by putting their staked assets at risk of slashing across those chains with the possibility of rewards in the form of Canopy and native chain incentives.
Canopy's adaptable framework unlocks new possibilities in design and implementation. The protocol is inherently modular and minimally invasive. Incentive alignment is provided by Canopy, but not prescribed in any particular manner. We believe that incentive design is best left to the discretion of the developer and blockchain researchers. Canopy can support any number of implementations for these incentives, limited only by the creativity of the developer themselves. The attractiveness of their offering to validators will depend on the mix of risk and incentives on offer. The potential for innovation made possible by Canopy’s shared security is vast and we anticipate rapid expansion and increasing complexity in the research and development of shared security tools and primitives within our ecosystem.
When designing Canopy, there was emphasis on scalability. Canopy can provide effective shared security horizontally across hundreds of L1s. However, Canopy isn’t reliant on the limits of the size of a single block to scale thus doesn’t fall victim to scalability limitations of unichains. Its unique and flexible design allows it to scale nearly infinitely through vertically-integrated shared security where you can clone and customize the incentive layer protocol for use at multiple levels. For example, various implementations of the Canopy protocol can be interconnected to distribute the workload. This style of scaling creates various interconnected shards of the network, distributing the workload and enabling the customization of the implementation to the use case of the associated L1s. Most importantly, security association with given security roots are temporary and are a relationship of convenience. Canopy L1s can move between the various incentive layers seamlessly.
With the proliferation of independent L1s in Canopy’s ecosystem, the protocol needed to address common challenges that independent chains face. Its unique architecture separates consensus management from L1 operation, enabling chain-halt recovery. This means that even if an L1 fails due to code errors or validator issues, the security layer can take corrective measures, ensuring robustness and fault tolerance. Additionally, Canopy’s proprietary consensus protects against long-range attacks by using unique Verifiable Delay Functions to ensure that new blocks are added to the chain in a temporally consistent manner, making it infeasible for attackers to recreate the blockchain due to the significant computational resources and time required.