Dec 19, 2022
Uniting the blockchain world: The role of cross-chain bridges
How cross-chain bridges enable interoperability in Blockchain Cross-chain bridges enable seamless communication, assets, and data exchange across different blockchain networks.
When it comes to the use of data oracles, the need for a cross-chain bridge is very important, especially now that we have Blockchain classified as Layer-1 and layer-2, where layer-2 is the improvement on the layer-1 blockchain.
Cross-chain bridges are technologies used in different blockchain networks that allow the transfer of assets or data. This is essential for certain reasons which include allowing users to take advantage of the distinctive features of multiple blockchains allowing for interoperability between different blockchain-based systems.
What are the benefits of Cross-chain bridges?
Secure and trustless
The benefits associated with cross-chain bridges are numerous, especially for developers that love to build products on multiple chains. The most important benefit is that it allows users to move assets from one blockchain to another in a secure and trustless manner.
Eliminate third party
Cross-chain bridges the security of assets and also eliminates third-party through the migration process. They allow different blockchains to interact with each other by facilitating the transfer of assets between them.
This allows users to move assets from one blockchain to another without the need for a trusted third party to facilitate the transaction. By enabling direct interactions between different blockchains, cross-chain bridges can help eliminate the need for third parties and make the process of transferring assets between different blockchains more efficient and secure.
Access to new markets
Cross-chain bridges can provide a way for users to access new markets that are not available on their current blockchain network. This allows users to take advantage of different blockchain networks without having to switch between them.
Cross-chain bridges also provide a way to trade assets between different networks, allowing users to take advantage of different market opportunities. By connecting different networks, cross-chain bridges allow users to access more services, increase liquidity and create new use cases.
Increase in liquidity
Cross-chain bridges can help to increase the liquidity of assets between different blockchain networks. This can be beneficial for both users and developers, as it makes it easier to move assets between different blockchains and allows users to take advantage of different blockchain networks.
Interoperability
Communication between blockchains is important for efficiency, cross-chain bridges allow developers to transfer assets or data between various networks.
They are important because they create interoperability between different blockchains, allowing users to take advantage of the benefits of different networks without having to switch between them.
Challenges of using cross-chain bridge
Building solutions across different blockchains comes with certain level of challenges. Integrating different blockchain can be very complex, due to the various features and technical specifications associated with each blockchain. This makes seamless connection across various blockchains difficult.
A cross-chain bridge also requires consensus among parties involved. To make a cross-chain bridge work effectively, all parties must agree on the rules and protocols that will govern the transfer of assets or data.
When developing and deploying cross-chain bridges, security concerns are also important to consider. As these technologies allow assets or data to be transferred between different blockchain networks, they may be targeted by malicious actors hoping to exploit system vulnerabilities. For this reason, it is important for cross-chain bridge developers to carefully consider and address potential security threats.
How does a cross-chain bridge work?
To understand how a cross-chain bridge work is first understand what a smart contract does.
Smart contracts are programs run on the blockchain that are executed when pre-determined conditions are met. For example for an effective communication to take place between a French-speaking person and an Arabian, either of them must be proficient in one language in common. A smart contract can be termed as the language of the Blockchain.
A cross-chain bridge typically consists of two main components: a bridge contract on each blockchain that is involved in the cross-chain transfer, and a set of intermediary nodes that facilitate the transfer of assets or data between the two blockchains.
To transfer assets or data between the two blockchains, the user first initiates the transfer on the source blockchain by calling the relevant bridge contract. This contract then sends a message to the intermediary nodes, which are responsible for verifying the validity of the transfer and ensuring that all necessary conditions are met.
Once the intermediary nodes have verified the transfer, they will broadcast a corresponding transaction to the destination blockchain, which will then execute the transfer and update its state accordingly. The entire process is typically automated and occurs in near real-time, allowing for quick and efficient cross-chain transfers.
The user can then access assets or data on the other blockchain network using a wallet or other suitable software once they have been transferred. By doing this, the user can take advantage of the unique features or capabilities of the other network, while still being able to access their assets or data.
A perfect case study for Acurast
Let’s say for example, A developer whom for the sake of this article will be named “Bruno”, who is a blockchain developer and building a Decentralized application on Polkadot for example.
Bruno needs some data let’s say price feeds from Tezos, the process of being able to bring such data from Tezos and being used on Polkadot is a cross-bridge.
Overall, the purpose of a cross-chain bridge is to enable the transfer of assets or data between different blockchain networks in a seamless and secure manner.
Cross-chain problem in Web3
The web3 space can still be defined as novel and also have some challenges that are still meant to be solved, despite it being predicted as the future of technology.
One of the problems facing Web3 is interoperability. One of the solutions that is solving this problem is Acurast.
Acurast solves this by providing an infrastructure with a multi-chain first approach through its native interoperability layer. Developers gain access to a single abstraction layer that fulfills their off-chain data needs regardless of the ecosystem they develop for.
