Signifiance of Cross-chain
When blockchains were first being built, they were envisioned as being able to provide a ‘one size fits all’ solution, meaning that all transactions, smart contracts, or anything else is performed on a single chain. However, it’s clear now that such a system isn’t so practical, especially when there are scalability limits and innovation constraints.
What is cross-chain?
A cross-chain is the interoperability between two relatively independent blockchains. In other words, it allows blockchains to speak to one another because they’re built in a standardized way. Cross-chain implementation is mainly represented by asset swap and asset transfer, which is both an important part of the blockchain world and a key research direction of PPIO. With cross-chains, the limitations of a single chain can be avoided. Today we will explore the logical structure of the Cosmos crosschain protocol, one of the most promising cross-chain platforms.
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Cross-chain interaction can be divided into isomorphic crosschains and heterogeneous crosschains according to the different underlying technology. For isomorphic chains, the security mechanism, consensus algorithm, network topology, and block generation verification logic are consistent and the crosschain interaction between them is relatively simple.
On the other hand, the cross-chain interaction of heterogeneous chains is relatively complex and includes technology such as the PoW algorithm for Bitcoin and PBFT consensus algorithm for Tendermint. The block composition and the deterministic guarantee mechanism are quite different, therefore a direct cross-chain interaction mechanism is not easy to design. Cross-chain interaction between heterogeneous chains generally requires third-party ancillary services.
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What is Interoperaebility?
Every blockchain network represents an entirely new set of records and hosts different applications. They use different consensus protocols and take a unique approach toward blockchain, creating separate ecosystems not ready to interoperate with others.
Separate systems is true for every major blockchain, including Bitcoin and Ethereum. But thankfully, we have solutions such as the Harmony blockchain that help these blockchain networks interoperate. This ability of blockchain networks to communicate and share data with each other is what we call blockchain interoperability.
Even in offering better features, these projects miss one critical point, i.e., without interoperability, the adoption of blockchain will be highly segregated and restricted.
The best example is to think of the two biggest blockchain networks — Bitcoin and Ethereum. The first supports the most widely used cryptocurrency, BTC. The second supports the most number of decentralized applications (dApps) and a majority of the decentralized finance (DeFi) ecosystem worth billions of dollars.
