Three Cross-Chain Bridges for An Interoperable Future of Blockchain Networks

[Alex077 16063]

      

The advent of Bitcoin brought the possibility of developing blockchain networks to create a decentralized payment system that could run without requiring an intermediary or a central entity. However, there was a lot more that developers could do with blockchains. It led to the creation of new blockchain networks that were more scalable than Bitcoin and allowed the development of a whole ecosystem of decentralized financial applications. 

 

However, the problem with these blockchains was they did not have a way to talk to each other. Since they could not interact, the blockchain and crypto community got divided, with each member preferring networks that worked best for them. In order to unite the crypto community and build an interoperable future of blockchains, various initiatives have been taken over the years. One of them is the blockchain bridge. 

What are Blockchain Bridges and How They Work?

A blockchain bridge connects two different blockchain networks to provide a compatible way to interoperate securely on both sides. Using these bridges, users and developers can transfer tokens or arbitrary data from one blockchain to another. In decentralized finance (DeFi) space, blockchain bridges allow users to access the perks of different blockchain networks without sacrificing the benefits of the host chain. It brings in several use cases, including cross-chain collateral, better scalability of networks, and reduced transaction fees. 

Most bridges work on a mint-and-burn protocol. It means when a token is transferred from one blockchain to another, the underlying protocol first burns the token and then mint an equivalent token on the other blockchain. Essentially, bridges are of two types: centralized and decentralized. While centralized bridges rely on an intermediary to facilitate transactions between two networks, decentralized bridges operate on their own because they run according to their smart contracts. In the case of centralized bridges, a protocol makes someone a part of an authority that manages and reviews all transactions. This process varies from project to project. 

On the other hand, decentralized bridges run through a distributed network of participants that validates the transaction. In exchange for overseeing bridge transactions, these participants are incentivized to ensure they act in the system's best interest.

Bridges in Operation 

Free Ton Bridge

Though Ethereum gas fees are not as costly as they were a few weeks ago, they are still high for most users. Free Ton solves Ethereum's gas and scalability issues since it allows users to transfer assets from the Ethereum network to its own blockchain where fees are near-zero and transactions are done at a much faster rate. 

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