Understanding Rubic: A Comprehensive Overview

Key Insights

• Rubic is a DEX and bridge aggregator integrated with over 70+ blockchains and 220+ DEXs and bridges. It also develops cross-chain tools for dApps, including a widget and a customized full-fledged SDK.
• Rubic boasts over $644 million in cumulative transaction volume and 270,000 unique wallets. Additionally, it features a staking program that allows users to earn extra rewards from transaction fees.
• Rubic's Best Rate Finder, launched in March, streamlines the process of selecting the most cost-efficient swap rate by integrating directly with users' MetaMask wallets.

Introduction

Interoperability remains a core challenge in the cryptocurrency ecosystem. Blockchain ecosystems, whether a major L1 or one of the many L2s lack secure and reliable connections between them. The current state of cross-chain bridges, especially for decentralized exchanges (DEXs), exemplifies how far crypto is from realizing a diverse and multifaced landscape. There is a clear need to simplify these complex layers for end users to enhance their user experience and reduce complexity.

Rubic is tackling the challenge of interoperability head-on with the goal of enabling seamless cross-protocol interactions. Rubic is a cross-chain bridge and DEX aggregator, featuring its Best Rate Finder product. With this, Rubic strives to offer the most efficient trading routes and competitive exchange rates in crypto. Rubic simplifies cross-chain transactions for applications and users, making it easier to perform swaps across various networks. By focusing on emerging chains (e.g., Blast, Linea, Scroll, etc.), Rubic aims to separate from the competition by acting as the central router in the emerging cross-chain environment.

Rubic was founded in 2020 by Vladimir Tikhomirov and Alexandra Korneva. The only funding the team received was around ~$500,000 (1,800 ETH) in 2020. Its native token, RBC, has a circulating market cap of $3.6 million as of writing.

Tokenomics

RBC’s max supply that can be minted is 1 billion RBC. However, its emission is driven purely by the project’s business needs. As of now, the total supply is 169.1 million RBC. The token distribution is seen below:

Source: Rubic

The distribution is as follows:

• 25% to ecosystem growth, which includes a grant program for Rubic’s integrators and promotion of B2B tools (locked until December 2024).
• 15.9% to pre-seed holders (i.e., holders of a prior version of the RBC token).
• 15% to potential seed investors. This emission is hard to predict timing-wise and is not currently minted.
• 14% towards treasury and marketing. In 2023, Rubic expanded its user base and plans to leverage additional user acquisition with product updates. Additionally, the team aims to launch grants for integrators. This growth emission is currently locked.
• 9% to the team.
• 7.4% for bootstrapping liquidity.
• 7% to loyalty programs, including the upcoming Swap-to-Earn program and potential new incentive mechanisms that reward consistent activity on Rubic.
• 5% for listings (potential to change based on negotiations).
• 1.7% to retro drop.

The 15.9% airdropped to pre-seed holders is favorable; 31% of the total supply will be minted in 2024, and the team has only 9% of the total supply. Rubic runs governance through Snapshot and maintains transparency regarding forthcoming reward grants and token-related events.

RBC tokens serve multiple critical functions within the Rubic network: 

• Loyalty program to encourage consistent usage.
• SDK subscriptions and platform integration service fees.
• Potential airdrops for tokenholders.
• Fee-sharing mechanism via staking.

Rubic's staking program distributes 50% of its collected fees to participants, with rewards paid in ETH. The program offers different staking periods, including a 3-month term option. The annual percentage rate (APR) varies based on several factors and increases with the duration of the staking period. Notably, staking for 6 months yields higher returns in the initial 3 months than opting for only a 3-month stake. Rewards are denominated in ETH, and the APY for 9 months was around 35%.

Security and Mechanism Design

Rubic is a front-end application that does not use external servers and routes all swaps through existing bridges and DEXs. To find the best swap deal for most cross-chain and onchain DEXs, Rubic routes to the exchange’s API and processes the data through the exchange’s services.

In 2022, Rubic experienced two hacks in two months, where an attacker stole around 34 million RBC tokens by accessing the admin wallet’s private keys in November 2022 and a $1.2 million hack in December. To address these issues, Rubic has significantly reformed its security practices.

The security of cross-chain swaps is anchored in three main factors: the integrity of the underlying blockchains, the architectural robustness of the swap protocol, and the protective strategies deployed by exchange platforms. Aggregators like Rubic play a critical role in enhancing security by integrating with multiple systems, thus facilitating swaps through various providers. If a provider fails, aggregators could quickly disable its connections and reroute transactions to another operational provider. By leveraging their extensive network of bridges and DEXs, aggregators can maintain seamless and secure operations.

Rubic’s development team revamped their architecture following the hack and secured smart contract management interfaces with a multisig using Safe. Transactions were changed from third parties to Rubic contracts, and thus, fees were switched back on. As of writing, Rubic charges $2 for cross-chain swaps and $1 for onchain swaps, in addition to standard gas costs.

Smart Contract Architecture

With its multiple providers, Rubic can execute swaps and aggregate liquidity even if some providers stop operating. Rubic currently aggregates over 220 bridges and DEXs. Rubic never holds funds on its front end, and every transaction is performed via API by sending calls to the smart contracts. By not relying on external servers, Rubic significantly decreases attack vectors (e.g., DDOS). Based on this API integration, Rubic’s SDK and widget already service over 130 crypto projects.

Source: Rubic

This architecture is structured around three core SDK modules, external API providers, and the RPC node. It uses the RPC node to facilitate interaction with other blockchains. The cross-chain manager queries the provider’s API, initiating transactions through Rubic's smart contracts. These contracts, in turn, engage the contracts of cross-chain bridges and DEXs. For EVM-based swaps, Rubic's SDK utilizes 1inch, OpenOcean, ODOS, XY Finance, and other natively integrated DEXs as its primary providers.

For example, a user interacts with the Rubic front end and wants to exchange UNI on Ethereum for ETH on Optimism. Rubic checks the integrations with bridges and DEXs to find the cheapest way to bridge the assets and make the swap. If the user decides to make the exchange, Rubic executes all the transactions for the user and simply gets the x-chain swap executed. For a service like this one, Rubic would charge x in fees.

Rubic's widget allows integrated dApps to earn up to 50% of the revenue from Rubic’s transaction fees. Applications can leverage Rubic's SDK, widget, and upcoming API to enable onchain and cross-chain swaps at the best rates. These tools are easy to integrate and provide a complete cross-change solution for any pairs with providers to choose from rather than just providing a single bridge. This cross-change solution could be implemented on a website, within a mobile gaming application, or even at analytical DeFi projects. With these tools, Rubic emphasizes its user experience by way of one-click swaps, as well as by simplifying the onboarding process. With Rubic, users can bring any token from any 70+ blockchains into the dApp to onboard.

Additionally, the widget facilitates the buying and selling tokens directly on the website or application, enhancing user experience. Written in JavaScript, the widget is designed to be scalable across various devices. In Q2 2024, Rubic is also planning to release its API. A potential cross-chain API could allow dApps and developers to expand their DeFi capabilities by plugging into Rubic’s best rate finder aggregator.

Network Activity

Rubic launched two major updates for RBC holders and users. Released in April 2023, Swap-to-Earn is a rewards campaign to incentivize activity on the platform, giving users 50% of the swap fee in RBC for their first cross-chain and first onchain swap. In Q4 2023, Rubic updated its rewards policy to offer 25% for cross-chain and onchain swaps. To claim rewards, users must accumulate at least 300 RBC, equivalent to $10 USD at the time of writing. However, the Swap-to-Earn program excludes transactions that involve deflationary tokens, on-ramp swaps, or any swaps conducted outside the project's official interface. RBC rewards are now calculated as a percentage of the fees paid. Doing so makes Swap-to-Earn less susceptible to the RBC token's volatility.

Rubic's growth has remained steady, with monthly transfers averaging about $20 million, or $650,000 daily. Arbitrum, zkSync, and BSC account for 42% of all transactions, and together with Ethereum for 67% of all transaction volume on Rubic. Newer networks like Polygon zkEVM, Linea, and Base are also popular routing destinations.

Rubic aims to attract new users by focusing on emerging chains like Scroll and Blast. The overall share of transactions to L2 networks in Rubic’s cross-chain transactions has already reached 62%. Its user base surged to over 270,000 wallets, and 2023 showed a 311% increase from 2022. Furthermore, onchain transactions on Rubic also grew significantly, hitting 826,000 transactions since the start of the project and growing 218% in 2023.

March saw Rubic’s highest transaction volume ever, totaling $40 million, with $8.4 million on Binance Smart Chain, which also facilitated 30% of transactions in March. November 2023 set a new record for the number of transactions facilitated (107,000). The introduction of the Swap-to-Earn program, launched in April 2023, and mainnet launches of L2s and its promotions (e.g., zkSync, Manta, Linea, and Polygon zkEVM) helped catalyze this growth. 

In June 2023, Rubic staking went live on the Arbitrum network. Users are required to stake either 3, 6, 9, or 12 months and can join multiple periods multiple times. Currently offering 33% APR, staking rewards are derived from 50% of all fees earned on swaps. The APR varies based on factors such as pool share, the amount of RBC staked, token price, Rubic's revenue, and the length of the staking period. Rewards are calculated every second for those in the staking pool, proportional to their pool share, and paid out in ETH tokens on Arbitrum.

After depositing RBC, users receive an NFT containing information about the amount of tokens deposited and the period length. While rewards can be withdrawn anytime, the initial deposit must remain locked until the chosen staking period ends. Currently, 35 million RBC, or 21% of the circulating supply, is staked, amounting to $1.3 million locked in the pool. This results in an estimated weekly yield of 2.15 ETH.

Roadmap

Along with staking, Rubic is looking to attract users by adding additional chains and NFT bridge integrations and bringing all cross-chain tools under one SDK umbrella. The team recently integrated an MEV bot protection widget by Bloxroute. It also introduced its BestRateFinder, built for crypto traders looking for the best swap rates. This tool compares users' trades against over 200 DEXs in real-time, ensuring the most favorable rates without having to search each DEX manually. Because Rubic is integrated directly with the MetaMask wallet, it simplifies the trading experience by aggregating data from over 15,000 tokens across 70 networks into a single, easily accessible platform. This setup enhances the swapping experience by providing a more efficient and cost-effective way to navigate the complex landscape of DEXs.

Rubic recently integrated with Blast mainnet, Horizon EON, Rootstock, Merlin, and Kroma.  Additionally, the platform aims to integrate two new blockchains: zkFair and Mode.

Source: Rubic

Rubic’s main competitors are LI.FI, XY Finance, Bungee, and Rango. While the majority of Rubic transactions are EVM-based, the exchange is also capable of handling non-EVM. A key differentiator for Rubic is its integration with LI.FI, XY, and Rango, significantly expanding the ecosystem accessible to its users.

Source: https://docs.rubic.finance/

Throughout 2024, Rubic plans to cement its place amongst the first cross-chain providers for the new networks, develop a mobile application, and improve its cross-chain services for dApps via a dedicated API.

Conclusion

Rubic is an aggregator in the cross-chain and onchain swap space. It leverages an architecture that outsources reliance on external servers, routing all transactions through existing bridges and APIs. Rubic can directly engage with providers' APIs for optimal swap deals and has remained committed to robust security measures following a significant security breach in November 2022.

Rubic’s main offering is its ability to aggregate liquidity and find the best rates for swaps across 220 bridges and DEXs. Rubic's smart contract-centric operations, API-driven SDK, and user-friendly widget offer developers and users a versatile tool for navigating the cross-chain terrain. This system enhances transaction security by minimizing reliance on potentially vulnerable external servers.

Rubic's engagement strategy, notably through the Swap-to-Earn program and its staking initiatives, aims to bolster platform activity and user participation. Between overall growth, strategic updates, and the broadening of its service offerings signal a clear path toward expanding its user base and solidifying its position in the market. Looking forward, Rubic's roadmap focuses on integrating new blockchain networks, enhancing cross-chain messaging, consolidating its tooling, and positioning the platform to potentially capture a larger share of the cross-chain swap market in the evolving blockchain landscape.

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