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Digging Deeper Into The World of Wormhole Protocol?

What is a Wormhole in the world of Crypto and Blockchain?

What’s the problems statement?

There are multiple blockchain platforms like Ethereum, BSC smart chain, Polygon, Terram Solana, Avalanche, Oasis, etc, and they need to often communicate with each other to leverage each other's capabilities and token swapping, etc, but cross-chain communication is complicated and need a standardized protocol to facilitate the same seamlessly. How to achieve that?

Here is “Wormhole”! At your service.

What Is Wormhole?

“Wormhole is a generic message passing protocol that connects to multiple chains including Ethereum, Solana, Terra, Binance Smart Chain, Polygon, Avalanche, Oasis, and Fantom.”

What problem Does Wormhole Solve?

There are two very common problems that limit blockchains to thrive

  1. The tokens are carved out of different blockchain platforms using a different set of smart-contract rules. Often these tokens need to move between these blockchains without relying on CEXes(Centralized exchanges ) for executing functionalities like swapping and bridging, which may expose users to counterparty risks
  2. Interoperability between DApps and Smart-contract platforms is a challenge

Wormhole protocol has been designed to overcome these key limitations

How Does It Work?

It utilizes the power of “Wormhole Token Bridge ” that facilitates the trustless, permissionless transfer of crypto assets between multiple Layer 1 blockchain platforms like

  • Ethereum
  • Solana
  • BSC: Binance Smart Chain
  • Terra
  • Polygon
  • Avalanche

But how does it secure such transfers?

Well, it makes use of Guardian Node.

Guardians are set of hand-picked validator nodes monitoring activity on the chains.

Wormhole relies upon a set of distributed nodes that monitor state on several blockchains. In Wormhole, these nodes are referred to as Guardians. The current guardian set can be seen in the Wormhole Explorer.

Explain Guardians With Examples?

Some of the best known and popularly used Guardians are

  • Everstake
  • 01node
  • ChainLayer
  • DokiaCapital
  • Certus One (They developed Wormhole)

To know more about such Guardians visit;

Why Wormhole, What’s Unique About It?

  • It supports a wide range of Popular blockchains to facilitate cross-chain communication and interoperability
  • It has an awesome Wormhole NFT bridge that allows ERC721 and SPL NFTs to be transferred between Ethereum, Binance Smart Chain, Polygon, Avalanche, Oasis, Fantom, and Solana.
  • It allows DApps to be built natively across all popular blockchains.

For instance, one can develop an app that may opt for Solana to confirm transactions because of its low transaction fees but choose Ethereum as its final settlement layer because of Ethereum’s security.

Summary:

The wormhole has made life easy for many blockchain developers and aspiring projects who were struggling to enable cross-chain transactions which was the need of an hour. Wormhole has seen massive adoption to facilitate bridging and interoperability and it continues to grow fast as a messaging protocol.

Soon we will see massive DApps and DeFi features being built because of the Wormhole protocol to make our blockchain ecosystem healthy wealthy and wise.

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Well researched educational content for the crypto enthusiast

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@pramodAIML

@pramodAIML

Passionate Blogger & Tech Entrepreneur | Founder of FinTech Startup | Write about AIML, DevOps, Product Mgmt & Crypto

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