Trustless Bridges Probable Solution to Blockchain Interoperability
Crypto and blockchain advocates always feel proud of their ecosystem since it’s disrupting the financial ecosystems as we know it. However, the crypto ecosystem isn’t united since it consists of several blockchains independent of one another. Hence, this lack of interoperability is the major obstacle to the global adoption of blockchain and decentralized finance (DeFi).
This obstacle hinders the growth and application of decentralized apps (Dapps). Dapps developers remain stuck in Ethereum because they struggle to operate across multiple blockchain networks.
Most Developers Are Unhappy with The Ethereum Network
A Dapp survey reveals that Dapps running on the Ethereum network is about 60%. Despite this high number of Dapps on Ethereum, most developers there aren’t happy with the blockchain.
One leading cause of their unhappiness is the rising transaction fees; even users complain of the same problem. Also, the blockchain’s network clogs frequently despite being six years old. Its transaction speed is still around 16 transactions per second (TPS).
Hence, developers are struggling to bring their projects to life. Even the much-expected eth 2.0 upgrade didn’t provide any solution to the network’s scalability problems. The hope is that by the time the implementation of Eth2.0 is complete within the next 12 months, those scalability problems might be resolved.
Unfortunately, scalability issues don’t seem to be the network’s main priority; it appears to prioritize security upgrades and proof-of-stake migration. Since the network isn’t prioritizing what’s important to them, developers now seek options. However, these developers will prefer a collaboration of blockchains because the growth of DeFi depends more on interoperability than utilizing a single network.
Interoperability and The Concept of Decentralization
Interoperability is seen as the solution to the application of Dapps besides Ethereum because it enhances communication across multiple blockchain networks. It eliminates the current mentality of blockchain X is better than blockchain Y. There is a paradigm shift towards combining two blockchains for a specified purpose.
A prominent example of the importance of interoperability is wrapped bitcoin (wBTC). The wrapped bitcoin is similar to a blockchain bridge that makes it possible to convert bitcoin to ether. There is about 1% tokenized wBTC of BTC supply on Ether.
Another example is the ERC-20-compatible wrapped tokens. These tokens hasten bitcoin transactions and make it possible to deploy bitcoin on DeFi protocols like Aave or for various DeFi operations.
Blockchain interoperability is one other reason users can avoid Ethereum’s rising gas fees by transacting ERC-20 tokens on the Binance Smart Chain and with transactions completed almost immediately. Interoperable solutions make the introduction of several DeFi applications and products possible.
Trustless Bridges for Blockchain Interoperability
We can infer from its name (bridges) that its role is to integrate blockchains and enhance communication. Users can leverage the benefits of various blockchains via trustless bridges. Ideally, tokens cannot leave their blockchains in transactions. They will only be locked in their blockchain while an equivalent is created on another blockchain. Thus, there is a constant token supply without an increase in volatility.
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