What Are Blockchain Bridge : Types and Working
In the world of Web3, we’ve seen a boom in both L1 blockchains and L2 scaling solutions and ways to make them faster and more efficient. But with all these options, there’s also a growing need to move stuff, like money or data, between these blockchains.
Think of each blockchain like different kinds of islands, each with its own strengths and weaknesses. But as we’ve got more and more of these islands, there’s also a growing need to move things between them. Each blockchain as its own little island, packed with valuable stuff.
But here’s the thing: these islands can’t easily talk to each other. It’s like they’re all cut off, unable to share their treasures because they speak different languages.
That’s where blockchain bridges come in. They’re like the bridges that connect these isolated islands, making it possible for them to exchange things. Lets explore more about these bridges👇🏾😊
What Are Blockchain Bridges? 🤔
Blockchain bridges are basically software tools that allow separate blockchain networks to share information and assets. These are like digital connectors that link different blockchain networks together.
For example, let’s say you have a cryptocurrency token on one blockchain, like Ethereum, but you want to use it on another blockchain, like Binance Smart Chain, to access different services or applications. A blockchain bridge would make this possible by allowing you to transfer your cryptocurrency token between the two networks securely and efficiently.
Different Types Of blockchain Bridges
Just like bridges in the real world come in different shapes and sizes, catering to different needs and environments, blockchain bridges also vary in their types and functions. Let’s take a closer look at the main types of blockchain bridges:
1️⃣ Trusted Bridges (Centralized or Custodial): These bridges are like crossing a bridge controlled by a central authority. They focus on being easy to use and fast, making them great for beginners or quick transfers. But remember, you’re trusting this authority to hold your assets, similar to trusting a bank. Examples include Binance Bridge and Multichain.
2️⃣ Trustless Bridges (Decentralized or Non-Custodial): Think of these bridges as community-built networks, eliminating the need for a central authority. They offer more security and control, like keeping your keys under your own mattress. However, they can be more complex to use and sometimes slower. Examples include RenVM and Thorchain.
3️⃣ Federated Bridges: These bridges are governed by a group of trusted entities, balancing centralization and decentralization. They aim to offer enhanced security and scalability compared to fully decentralized options. However, trust in the consortium is crucial. An example is the Cosmos IBC protocol.
4️⃣ Hybrid Bridges: These bridges combine elements of both centralized and decentralized models, striving to achieve a balance between security, speed, and control. The Huobi Eco Chain bridge is an example of this type.
5️⃣ Layer 2 Bridges: These bridges are like separate lanes dedicated to a specific blockchain ecosystem, focusing on making transactions faster and more efficient within that environment. An example is the Polygon Bridge.
6️⃣ Interoperability Bridges: These bridges focus solely on enabling communication between different blockchains, regardless of their specific features. They prioritize breaking down communication barriers and fostering interaction between diverse blockchain ecosystems. The Cosmos IBC protocol falls into this category.
7️⃣ Liquidity Bridges: These bridges act as pools of assets, allowing users to swap tokens across different blockchains. It’s like dipping your token into one pool and getting its equivalent in another. Examples include RenBTC and WBTC.
8️⃣ Pegged Bridges: These bridges create “copies” of tokens on another blockchain, pegged to the value of the original. They offer wider accessibility but come with potential risks linked to maintaining the peg value. WBTC is an example of a pegged bridge.
9️⃣ Atomic Swaps: These bridges facilitate direct peer-to-peer exchanges, eliminating the need for intermediaries. It’s like two people directly swapping tokens across blockchains without trusting a third party. An example is AtomicDEX.
How do Blockchain Bridges Work? 🤔
Here’s a simplified explanation of how they typically operate:
👉 Initiation
- The process begins when a user initiates a transaction to transfer assets from one blockchain to another.
- The user specifies the assets they want to transfer and the recipient’s address on the destination blockchain.
👉 Locking Assets on the Original Blockchain
- To start the transfer, the user locks the assets they want to transfer on the original blockchain.
- This involves sending the assets to a specific address or smart contract controlled by the blockchain bridge.
- The locking process ensures that the assets are securely held and cannot be accessed until the transfer is completed.
👉 Confirmation and Verification
- The blockchain bridge confirms the transaction and verifies the availability of the locked assets.
- Validators or nodes on the original blockchain validate the transaction and ensure that the assets are locked and ready for transfer.
👉 Representation Creation on the Destination Blockchain
- Once the locking process is confirmed, the blockchain bridge creates a representation of the locked assets on the destination blockchain.
- This representation can take the form of tokens or other digital assets that mirror the locked assets on the original blockchain.
👉 Transfer Initiation
- With the representation of the assets established on the destination blockchain, the transfer process is initiated.
- The blockchain bridge securely transfers the representation of the assets to the recipient’s address on the destination blockchain.
👉 Verification and Consensus
- Validators or nodes on both blockchains verify the transaction and reach a consensus on its validity.
- This consensus ensures that the transfer is executed accurately and securely across both blockchains.
👉 Unlocking Assets on the Destination Blockchain
- Upon successful transfer, the recipient can unlock the representation of the assets on the destination blockchain.
- This involves confirming the receipt of the assets and unlocking them for use or further transactions on the destination blockchain.
Why We Need Blockchain Bridges? 🤔
Just as you wouldn’t want to be stuck on just one platform, blockchains also shouldn’t be isolated from each other. Right now, they’re like islands, unable to share stuff like data or assets. This lack of interoperability restricts liquidity, limits NFT reach, hinders exciting gaming experiences, and stifles innovation.
With bridges, DeFi users access diverse opportunities, NFT owners expand their reach, gamers enjoy interoperable universes, and developers build revolutionary applications. So, think of bridges not just as handy tools, but as the essential roads that lead to a more connected, efficient, and creative Web3.
Conclusion
Blockchain bridges are like magic doors that connect different blockchains together, creating a big network where they can all work together. With these bridges, it’s like breaking down walls between different blockchains, opening up lots of new ways for them to work together and grow. This makes the whole blockchain world more connected and inclusive.
Looking ahead, it’s super important to keep building and using blockchain bridges. They’re key to making blockchain development even better. By facing challenges head-on and grabbing opportunities as they come, we can make sure blockchain bridges keep driving good things like innovation and positive changes in the blockchain world.
