Decentralized finance is renowned for its hassle-free transfer of money without the intervention
of a
third
party or bank charges. However, when we speak about the transfer of tokens between two decentralized platforms which use different consensus
mechanisms, the
cost
of gas is astronomical. Cross-chain transactions are handled with hefty gas charges based on the
differences
in their consensus mechanism.
To tackle the issue of the high costs for gas in cross-chain transactions, bridges across chains
were
developed. These bridges are vital to boost growth across various blockchains, allowing asset
interoperability that is secure and enhanced asset rendering.
With the increasing demand for transactions between blockchains operating using different
consensus
mechanisms, bridges across chains have grown important. They facilitate the communication
between various
peer-to-peer networks at a low cost. While reducing the costs of gas and gas, the cross-chain
bridge
concentrates on increasing processing speed to enhance the interactions with cryptocurrency
assets to
provide a better user experience. In addition, it increases the capabilities of existing crypto
assets and
offers an extremely secure and private.
The Polkadot network has a range of bridging methods, such as pallets, smart contracts, smart
contracts,
and higher-order protocols. These strategies help bridge the gap in connectivity between the
different
blockchain ecosystems in a non-centralized way to guarantee economic sovereignty. This article
is a short
overview of cross-chain bridges available on the Polkadot network.
What exactly is what is a Polkadot bridge?
Polkadot was initially designed as the basic structure to implement interoperability,
scalability, and
security for the cross-chain network. It enabled different layer-1 parachains to interact within
a single
ecosystem. Polkadot is also unique in its feature, which permits a para chain and any other
non-para chain
to connect. It accomplishes this by using blockchain bridges. Since they are a part of the
Polkadot
network
was created to eliminate mediation between various P2P networks, Blockchain bridges are favored
particularly
for cross-chain trust.
Let's now explore Polkadot bridges using an illustration. Imagine a decentralized marketplace for
an
insurance firm. One approach is implementing an individualized para chain that functions as a
market for
insurers' traders. It is assumed that Polkadot owns an oracle para chain that carries external
data
onto-chain and the Internet of Things (IoT) para chain, which collects all information that is
gathered
that
comes off of IoT
devices.
Suppose you've bought the insurance for flight delays. In that case, the insurance policy can be
designed
so that it will be able to pay when the oracle's para chain proves the existence of delays in
the flight
and
the IoT para chain proves that you have arrived at the airport at the time you specified.
Suppose the
insurance's para chain gets an alert from the oracle and IoT parachains. In that case, it will
use the
blockchain bridge to start an exchange using cryptocurrency, which is transferred from the
insurance
company's account to the account of the policy's owner. This is the way bridging can facilitate
interoperability.
After we've figured out the role of bridging for parachains and non-parachains, we can see that
there is
a
framework that can be used to build both kinds of chains. The framework is called the substratum
framework.
Substrate-based parachains are linked and protected by Polkadot and Kusama Relay chain so that
they can
interact alongside other parachains. However, the standalone substrate-based and independent
chains that
are
not based on substrates, such as Ethereum, can connect and communicate with parachains through
blockchain
bridges.
To improve the quality of the substrate-based chains' connectivity, the Polkadot Parity team has
been
working on constructing an all-purpose bridge. The bridge will comprise various elements that,
when
combined, allow bi-directional and cross-chain interaction between a single chain based on a
substrate and
an additional para chain or between two independent substrate-based chains.
A concrete example of the bridge
For a concrete bridging model, you could consider the possibility of a decentralized insurance
market.
One
method to create this using Polkadot is to deploy an insurance-specific para chain that
functions as a
marketplace that serves the buyers and sellers in insurance. Consider that Polkadot also had an
Oracle
para
chain, which added external data to the chain. The Internet of Things (IoT) para chain combined
data off
the
chain IoT devices.
If you purchase insurance for flight delays, and the policy was made so that it pays out when
both the
oracle and IoT parachains confirmed that the flight was delayed. The IoT para chain verified
that you had
arrived on time to catch your flight at the airport. On-chain if the insurance got a message
from an
oracle
as well as IoT parachains, then it can make use of the Ethereum bridge that triggers a transfer
by using
an
unstable coin, like Dai or Dai, which is transferred that is deposited from the insurance
company's
account
to the account of the policy holder's. This is a straightforward example of the power of
interoperability.
Polkadot is built for this kind of future. We do not just see applications that run on one
platform and
sometimes leverage different networks for the basic transaction, but those that go further than
this can
run
across various blockchain networks with various levels of specification. The high-quality
bridging
technology will bring us one step closer to the future.
Bridging Substrate-based Chains
The Substrate is a Substrate blockchain-building framework that could be used to create
parachains (when
integrated with Cumulus) Cumulus algorithm for consensus) as well as solo blockchain technology
that come with
their security and consensus. While parachains, connected to and protected by those of the
Polkadot and
Kusama Relay Chain, are first-class members of the ecosystem, Solo chains built on Substrate can
connect
and
interact with parachains in the ecosystem via bridges.
A generic bridge to connect Substrate-based chains is being developed through members of the
Parity team.
This bridge comprises several elements that enable bidirectional communication between a
separate
Substrate-based chain and a para chain called Polkadot or between two separate Substrate-based
chains.
Particularly this bridge will allow interconnection between Polkadot and the Kusama networks.
The progress
of Parity's trusted bridge can be tracked on the Parity Bridges repository.
Bridges supported through Web3 Foundation Grants
The Web3 Foundation grants programs have helped to build a variety of ways to connect to the
Polkadot
ecosystem, such as those listed below:
- Interlay is building a trusted bridge that connects Bitcoin into Polkadot. The beta test net
stage
will
allow users to create 1:1 Bitcoin-backed assets on Polkadot in the form of PolkaBTC.
PolkaBTC can be
utilized in conjunction with any other application or para chain in the Polkadot ecosystem
in the same
way
as it is a native asset, which will allow BTC liquidity for DeFi of Polkadot's. Under the
hood, PolkaBTC
implements the XCLAIM protocol, which makes the bridge financially trustless,
permissionless, and
censorship-resistant. The PolkaBTC is a reward-based Beta testnet launched in the middle of
February and
has undergone a massive UX redesign. Parallel to this, PolkaBTC is being audited by the NCC,
and
Interlay
is beginning to incorporate PolkaBTC and the other Parachains that are part of Rococo.
- Snow for is working on an all-purpose bridge between Ethereum and Polkadot. This will permit
ETH
transfer to and from Ethereum to Polkadot as well as ERC20-related assets and any other
data. Beyond
asset
transfers, the bridge could be used for more complex interactions like cross-chain smart
contracts. For
instance, any application developed on Polkadot could use the bridge to transfer Dai across
accounts
through Ethereum. Ethereum blockchain.
- Darwinia is creating an unrestricted, non-custodial bridge that is not cus with a low-cost,
efficient
decentralization of cross-chain tokens and non-fungible token (NFT) transfers and other
cross-chain
transactions. The Darwinia bridge combines technologies, including extremely light clients
with zero
knowledge and reliable verification methods. Darwinia has already announced their bridge for
Ethereum
and
is planning to launch additional bridges shortly connecting major heterogeneous blockchains
like BSC,
Tron, Filecoin, etc.
- Centrifuge worked with ChainSafe to develop a modular asset-agnostic multidirectional bridge
that
connects Substrate-based blockchains and Ethereum. ChainBridge is a bridge that allows
ChainBridge to
let
Centrifuge move fungible NFTs across chains, which enables the financing of real assets
through a
variety
types of DeFi products. Because it is an open-source project, ChainBridge also enables other
teams in
the
community to create bridges to their projects.
- ChainX is an asset gateway for crypto planning bridges with multiple networks. They have
also
developed
the BTC substrate bridge. The bridge is controlled by validators invested by ChainX's Proof
of Stake
consensus, managing the BTC Multi-Sig wallet.
- Bifrost has created its EOS network bridge, which enables the transfer of assets across
secure chains
through the use of on-chain light nodes that have Merkle tree verifiability. The third
testnet version,
Bifrost Asgard CC3, was released recently. Shortly, Bitfrost plans to work to integrate with
EOS
contracts.
The Future of Web 3.0 is now in the hands of HTML0. of Web 3.0
Blockchain's future infrastructure is in the ability of everyone to work together in the spirit
of
collaboration. We're committed to connecting groups to Substrate and Polkadot ecosystems. We aim
to create
reusable development components which make it easy to create bridges and connect to other
blockchains.
Conclusion
As the industry continues to evolve, the DeFi industry crossing-chain bridges have emerged as the
most
popular method for trading and transacting opposed to traditional exchanges. They offer
interoperability
and
integration of
Polkadot App Development Company to help diversify investors and blockchains, which
address the
issue
of capital flows by cutting down on transaction costs for users. Bridges also compensate for the
differences
between ecosystems to ensure that the exchange of information between traders and the expansion
of trading
isn't limited to a single substrate chain or a para chain.
