Blockchain is the equivalent of the Internet in the early 1980s, so what cross-chain infrastructure is worth paying attention to?

As a network, blockchain is roughly equivalent to the Internet in the 1980s. Because the ecosystem is extremely fragmented, applications, users, and funds are all separated into different network systems.

Cross-chain bridges are certainly very important solutions, but they should not become the norm. The real large-scale adoption of blockchain requires core protocols and APIs.

Ethereum founder Vitalik once summarized three cross-chain solutions: hash time lock (HTLC), notary and side chain/relay.

Hash time lock uses cryptography to achieve cross-chain transfers. The principle can be simply understood as Alipay, but the implementation method is decentralized.

The notary mechanism refers to a notary setting up an intermediate account, into which users transfer their assets. The principle is almost the same as Alipay’s inter-bank transfer, and requires the notary to issue a vToken across chains.

Since the notary acts as a bridge between blockchain networks, the transaction fees will be very low or even free. The only risk lies in whether the notary is trustworthy - not only whether he has the motivation to do evil, but also whether he is vulnerable to attack.

The third is the side chain/relay solution, which can also be called a bridge chain solution, because the relay chain is essentially a side chain shared by multiple chains, which then enables interoperability between side chains.

This common sidechain still acts as an intermediate account, but it is more secure than the notary mechanism mentioned above. Both Cosmos and Polkadot are more complete in technology and mechanism.

Among the three cross-chain solutions mentioned above, the third one is the real cross-chain interconnection. Its current development level is similar to that of the Internet in the early 1980s, that is, nothing has been established.

But on the other hand, this is also why we need to build cross-chain infrastructure.

There are currently three major cross-chain infrastructures: Polkadot, Cosmos and Axelar.

1. Polkadot

Polkadot is the cross-chain infrastructure with the largest number of developers and the largest amount of deposited funds.

On Polkadot, cross-blockchain transmission of any type of data or assets is supported, not just tokens, but Polkadot's cross-chain is homogeneous cross-chain, which means that cross-chain can only be carried out within the Polkadot ecosystem.

From a technical perspective, Polkadot's cross-chain is close to a sharding solution, and the security of the entire ecological network is maintained by the relay chain.

Therefore, Polkadot has a very close relationship with ecological projects, and the number of slots is very limited, and the staking cost is also very high. As a result, ecological projects are firmly tied to Polkadot, so it is criticized for being too centralized.

2. Cosmos

Cosmos is also a homogeneous cross-chain, and ecological projects use IBC (Inter-Blockchain Communication Protocol) to connect. This looks very similar to Polkadot, but Cosmos is not as centralized.

Polkadot's cross-chain communication is achieved through slots, while any two chains in the Cosmos ecosystem can interact freely.

This has led to the fact that there are many high-quality projects in the Cosmos ecosystem, but they are of little help to the Cosmos ecosystem, especially to the price of the ATOM currency.

In addition, Cosmos' cross-chain protocol can also partially realize heterogeneous cross-chain, such as the ability for alliance chains, public chains, and private chains to interoperate, as long as the other chain also has an IBC protocol (only some modules need to be modified).

So from the perspective of cross-chain technology alone, Cosmos is superior to Polkadot in interoperability and scalability, and can better cope with complex real-world infrastructure.

3. Axelar

Axelar is an emerging (mainnet is not online yet...) cross-chain infrastructure that can be integrated with all blockchain ecosystems.

That is to say, it can interoperate with any chain (whether L1 or L2, PoW chain or PoS chain), plug and play, and there is almost no need to integrate a new chain.

And joining a new chain to the Axelar network is permissionless and can be done by executing just a few commands.

Axelar can achieve cross-chain at the asset level, but this is not done directly in the wallet like a cross-chain bridge, but through a Dapp called Satellite.

Currently, the innovation of DeFi has begun to slow down, and the breaking point lies in composability, but this composability is on a single chain. Axelar can release the liquidity of the entire blockchain ecosystem and transfer assets from one chain to another for seamless interaction.

Axelar is expected to launch its mainnet in the near future. In the future, it will be able to enable communication between blockchain networks such as BTC, Ethereum, BSC, Avalanche, and connect to ecosystems such as Cosmos and Polkadot.

Summarize

If we refer to the development history of the Internet, cross-chain is a track with a cycle of ten years.

We have seen countless cross-chain solutions emerge, moving from simple to complex, and from upper-layer applications to infrastructure.

In any case, cross-chain bridges are a transitional phenomenon of the past, and we should turn our attention to more basic cross-chain infrastructure.