New York, NY, February 24th, 2025,

The latest Axelar Network upgrade marks a new era of scalable interop – including a governance-approved fee-burning mechanism and token utility that grows with each new chain connection

The Axelar Network has completed an upgrade to v1.2.1, following tokenholder approval in an on-chain governance vote. The upgrade, code-name "Cobalt," implements new AXL tokenomics that send network gas fees paid in AXL to a burn address.

The Cobalt upgrade hardens the AXL token supply to incentivize interoperability at unlimited scale. It completes a development stage that began with the Axelar Virtual Machine (VM), the only open-source programmable interop layer. Now, Axelar is an engine for permissionless new connections at global scale – and AXL utility grows with each new blockchain connection.  

“We are tokenizing interoperability,” said Georgios Vlachos, director at Axelar Foundation and co-founder of the Axelar protocol. “With this community-approved upgrade, Axelar is the only interoperability network with scalable tokenomics, powering decentralized infrastructure for a globally connected Web3.”

Blockchain interoperability demand drivers

In a post published Monday on X, Sergey Gorbunov, CEO of Interop Labs and co-founder of the Axelar protocol, described the factors driving demand for interoperability across a growing number of new blockchains: 

• Financial institutions issuing stablecoins and other tokenized assets require multiple, interconnected, private blockchains; 
• Stablecoins driving mass adoption, pushing builders away from ecosystem narratives and onto blockchains that best meet user needs; 
• AI applications requiring connectivity across specific blockchains that provide verification, compute and payment.

New blockchains arising to meet these needs will be able to connect to all chains easily using Interchain Amplifier, part of Axelar's Mobius Development Stack (MDS). Instead of adding inflation to support new connections, new integrators are required to set aside a reward pool in AXL, used to reward Verifiers that secure each new connection. This utility makes AXL an integral part of decentralized interoperability across potentially thousands of blockchains. 

AXL is the proof-of-stake utility token powering the Axelar Network: tokenholders exercise on-chain governance, and stake AXL with Validators, who run the Axelar Network's cross-chain protocol. Users pay fees in AXL. With the Cobalt upgrade now live, gas fees paid in AXL are sent to a burn address. When combining the gas burning mechanism with explicitly funding the reward pool, Axelar network has unmatched scalability properties and clear utility.

Early metrics on AXL reward pools & gas fee burns

Recent connections Sui and Flow are currently locking more than 300,000 AXL in Verifier reward pools, per month. All future blockchain integrations will be secured using Interchain Amplifier and this reward-pool mechanism. The current list of major blockchains set to integrate via Amplifier includes Monad, Solana, Stellar, TON, XRP Ledger, and dozens of other L1s, L2s and application-specific blockchains. Data on reward pool balances and fee amounts sent to burn addresses are publicly available at multichain.money.

Axelar is the only interop protocol with a utility token

Axelar Network can connect all these blockchains with the most distributed and robust liveness and security guarantee available in blockchain interoperability. Unlike comparable interop protocols, Axelar has no closed-source or custodial components. Instead, it is built on a public blockchain with a dynamic set of Validators running proof-of-stake consensus, incentivized by the AXL token. 

The Cobalt upgrade hardens the incentive power of the AXL token in this uniquely secure interoperability system. Cobalt follows the release of Axelar’s Mobius Development Stack (MDS) in October. It includes the Axelar VM, Interchain Amplifier for fast new-chain connections and the Interchain Token Service (ITS) for rapid, multichain tokenization. 

Connect & scale with Axelar

New connections to the Axelar Network are subject only to on-chain vote by AXL tokenholders and can be as simple as deploying a smart contract. 

• Learn more about the Cobalt upgrade: axelar.network/cobalt.
• Learn how Interchain Amplifier works for Verifiers and new connections: docs.axelar.dev. 
• Track AXL reward pools and gas fees: multichain.money.

Join the community of blockchain ecosystems, application builders, Validators, Verifiers and node operators in the Axelar ecosystem as it scales across Web3. 

About Axelar Network

Axelar is the Web3 interoperability platform, delivering the shortest path to scale: an open stack to connect all blockchains. Adopters include Uniswap, Microsoft and dozens of natively multichain startups with a combined total value locked (TVL) that has crossed $1 billion. Axelar supports a best-in-class developer stack on a cross-chain layer that is open, scalable and secure. Backers include Binance, Coinbase, Dragonfly, Galaxy and Polychain. Learn more: axelar.network. 

About Axelar Foundation

Axelar Foundation is a nonprofit established to support the growth and adoption of the Axelar Network, a decentralized interoperability network that connects multiple blockchain ecosystems. Learn more at axelar.foundation.

About Interop Labs

Interop Labs is a systems and product development company dedicated to enabling an open, interconnected Web. The company was founded in 2021 on the belief that open-source, heterogeneous, interconnected systems have the power to nurture innovation and creativity for the betterment of all humankind. Interop Labs builds, invests in and incubates innovative projects pushing the boundaries of blockchain interoperability, cryptography and machine learning – including as a core contributor to the Axelar Network, a leading interoperability protocol. Learn more: interoplabs.io.

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