Cross-Chain Bridging - A Tangible Future Prospect of Blockchain Technology

What is now considered the bedrock of all future transactions and economic activity, blockchain first emerged in 2008 by an anonymous entity called “Satoshi Nakamoto.”

This immutable virtual ledger was initially launched to support the cryptocurrency Bitcoin but has since grown to show immaculate potential in both development and application.

Its decentralized system and impenetrable protocol have sparked interest in industries and governments alike.

Major global economies, including India, Japan, and China, have started incorporating blockchain technology in their agencies and systems.

However, technology as wide in application with a relatively new conception as blockchain leaves many aspects unaddressed.

Therefore, continuous developments and modifications are being made to introduce updates. One such addition is cross-chain bridging, which allows communication between different blockchains.

It is further discussed at length in this article.

Defining Cross-Chain Bridging

Currently, blockchain functions in an isolated system where transactional interchange or other interactions are not possible.

This creates a dysfunction of asset transfer as users have to undergo time-consuming and costly processes to transfer assets from one chain to another.

To tackle this complex but cardinal issue, cross-chain bridges have been developed.

Cross-chain bridging is a path that allows reciprocity and interoperability between two or more blockchains. It allows for data to be shared, utilized, and communicated across blockchains that would otherwise function independently in isolation from one another.

This data may include tokens, cryptocurrencies, NFTs, and more.

As blockchain technology introduces decentralization to financial transactions, the exchange that was previously made through centralized authorities like banks now requires a different model to operate. That model is Cross-chain bridging, allowing the exchange of assets and tokens to be made in an impervious, decentralized ecosystem.

Several different protocols and types of bridges can be utilized to enable transfers through the cross-chain bridging. The following includes two of the most widely adopted transfer protocols in cross-chain bridging:

Wrapped Tokens

Wrapped tokens are provided by different cross-chain bridging provider platforms. A wrapped token allows the value of one asset or token to be encapsulated or stored in another token.

Different tokens are associated with each other by smart contracts, which allow this transfer to occur. For example, a Bitcoin can be wrapped with Ethereum’s ERC-20 smart contract to form WBTC.

Liquidity Pools

A liquidity pool refers to an inventory of different tokens and coins held by the cross-chain bridge provider. Coins can be exchanged from one currency to another from this inventory without seeking token minting permission from the bridge contract. Liquidity providers facilitate this exchange.

Trust-based Bridges

Trust-based bridges, commonly referred to as federation bridges, require a central assembly of mediators. These mediators allow exchange and conversion between coins and currencies, making users reliant on them for permission.

These trust-based bridges allow for an efficient and cost-effective transfer and exchange of assets.

Trustless Bridges

Trustless bridges rely on machine algorithms to verify and facilitate transactions, providing a decentralized path for financial exchange between blockchains. Similar to blockchains, individual networks contribute to verifying transactions allowing for a secure movement of cryptocurrency.

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What Advantages Does Cross-Chain Bridging Hold?

Like blockchain technology, cross-chain bridging also comes with wide applications and multiple use cases.

With its efficient transfer of assets coupled with an impeccably secure model based on decentralization, cross-chain bridging offers numerous advantages in the transfer and exchange of digital assets. A few of these are listed as such:

Efficient and Secure Transactions

Cross-chain bridging provides an operable alternative to off-bridge transfer, which is costly and vulnerable to attacks by hackers resulting in losses.

Asset holders from one crypto ecosystem can transfer their tokens to a wider range of other networks through the secure transfer pathway that cross-chain bridges provide.

For example, Bitcoin can be transferred to ether directly via cross-chain bridging without going through a tedious process of indirect conversion.

Reduced Network Traffic

Blockchain bridges allow an even distribution of traffic amongst blockchains. They do so by taking a load off of congested blockchains, for example, the Ethereum ecosystem, and redistributing it amongst other networks. This amplifies network scalability for heavily burdened networks and maintains overall system efficiency.

Incorporating Yield Farming on Blockchain

Integrated yield farming furnished by cross-chain bridges issues users a wide overview of the blockchain landscape. This allows them to evaluate a multitude of different yield farms before situating their assets for maximum profitability prospects.

Augmented Developer Experience

Developers on blockchains, for example, those creating dApps on the Ethereum network, often find themselves in a constant dilemma caused by slow transaction processing and high gas fee, especially during peak traffic congestion periods.

This impediment results in a less agreeable developer experience on blockchains. Cross-chain bridges authorize those tokens to be processed on other blockchains at a much higher rate and lower costs resulting in increased efficiency and a better developer experience on the blockchain.

Collaboration Between Developers

Through cross-chain bridging, developers get the opportunity to work together on different blockchains to create new and innovative user platforms. This interconnection allows collaboration between different developers from a multitude of unique blockchains through cross-chain bridging.

Reduces Monopolization

Cross-chain bridging also subsidizes market stability in the blockchain arena by redistributing traffic, thus reducing monopolization from major entities.

Bitcoin and Ethereum, for example, are blockchain powerhouses that account for most of the market share.

This makes the capacity for new competition null, as companies will not have room to experiment with innovative ideas and implement their vision in a one-sided concentrated market.

Inter-chain Transaction

Every blockchain is created as an independent and segregated system with directives, regulations, and particular consensus protocols.

This results in no direct communication and transaction of assets between blockchains. Here cross-chain bridges provide an elegant solution that allows token transfer from one blockchain to another.

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The Future of Cross-Chain Bridging in Blockchain Technology

Despite the need for reciprocity amongst blockchain and the availability of operably developed bridges, cross-chain bridging still contains a few creases that need to be ironed.

Since both blockchains and cross-chain bridges come with contract specifications and particular functionary regulations, transported assets, for example, NFTs, will lose or differ in value once transported from one blockchain to another.

Once an asset is moved from its original blockchain, it is no longer credited by the blockchains regulations of credibility; this may result in NFTs losing their stamp of originality.

Furthermore, when an asset is moved from its blockchain, it is complicated and depreciating to return it to its original blockchain.

Individuals must whitelist particular assets to ensure that they are transported through the bridges with their original registration.

This poses another complication in the transmission of assets as it leaves the exchange vulnerable to the risk of human error, thus causing assets to cross bridges without their original blockchain contracts.

Therefore, there is a need to cross bridges to assess each asset to utmost perfection. However, with the current systems in place, that level of security is not provided, resulting in attacks by hackers and tampering with the ledgers.

The entire enterprise of Blockchain technology is built on its guaranteed security, which is why this level of vulnerability in the transmission process may hold the entire technology behind. Therefore, the future application of cross-chain bridging has often been questioned with these reservations in mind.

Although there is much room for improvement in cross-chain bridging, it is still a new idea going through its initial phases of development.

There is no doubt that cross-chain bridging will have to go through several iterations and alterations to become applicable. But a reasonable argument can still be made to support cross-chain bridging’s future in blockchain technology.


With the expansion in blockchain applications, latest updates and improved protocols are continuously being introduced.

Amongst them, the applicability of several is questionable; however, from its esteemed development to its vital benefits, cross-chain bridging does uphold remarkable merits.

Nonetheless, just as every modern technology has limitations and grey areas of ambiguity, cross-chain bridging is no different.

However, it is safe to say that although the current form of cross-chain bridging leaves much to be desired, with adequate iterations and further development, it may have the potential to be applicable overall.

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