The future of blockchain is interchain interoperability.
As Columbia University Blockchain Accelerator advisor Art Malkov wrote in Forbes:
“Blockchain networks, the building blocks of Web3, are continuing to grow and introduce unique innovations, but they currently lack the capacity to easily integrate with one another. Since each blockchain has its own capabilities and specialties, it is becoming increasingly clear that a mature version of Web3 will depend on integrating all chains, allowing for mutual growth and ease of accessibility for users.”
Many blockchain ecosystems are responding to the challenge of interoperability by developing unique interchain bridging solutions. The ICON network is no exception, with work underway on the Blockchain Transmission Protocol (BTP), its chain-agnostic, scalable, and secure interoperability protocol.
In this post, we’ll compare BTP with three similar interoperability solutions, namely:
- Cosmos IBC: the light client-based solution of the Cosmos ecosystem
- Wormhole: the chain-agnostic but permissioned solution of the Solana network
- RenVM: a decentralized interchain solution that attempts to keep trust to a minimum.
Cosmos IBC
BTP is often compared to Cosmos IBC (Inter-Blockchain Communication protocol), the interoperability solution of the Cosmos ecosystem. Both Cosmos and ICON are interoperability-focused blockchain ecosystems, though how they go about this differs.
Cosmos is a layer 0 technology, meaning it is a technology used to build blockchains (i.e., layer 1 blockchains), something akin to the way that Polkadot works. Decentralized applications do not interact directly with Cosmos, but on the blockchains built using the Cosmos Standard Developer Kit (SDK). Cosmos also supports the Cosmos Hub, which is a layer 1 blockchain that is purpose-built to serve as an interchain communications portal. However, Cosmos Hub, aka ATOM, does not support smart contracts. The ICON ecosystem, meanwhile, supports the ICON Network, which is both an interchain communications portal and a blockchain for hosting decentralized applications.
Cosmos IBC allows all the blockchains, services and apps in the Cosmos ecosystem to interact seamlessly. Like BTP, it is a trustless solution — it requires no handpicked gatekeepers to grant permission for transactions to go through, a practice that has proven vulnerable to hacks.
Also like BTP, it uses light clients, or “mini blockchains” that let users sync blockchains in a secure manner without the massive resources needed to store the entire history of blockchain transactions.
The key difference between the two solutions is how they implement the light chains.
BTP focuses on integration with smart contracts. There are typically three smart contracts that a blockchain implements to integrate with BTP: a Message Broker, Light Client and Service Handler. On the plus side, though, this could make implementing BTP easier for non-ICON blockchains wishing to implement it.
The easiest way to implement Cosmos IBC is through a “module” built for Cosmos SDK. This makes interoperability extremely easy if you’re building inside the Cosmos ecosystem, but less so if you’re building outside the ecosystem. This does not mean that IBC can not be implemented on blockchains built without Cosmos SDK. According to one Cosmos user, “any fast finality blockchain can implement IBC.”
Wormhole
Wormhole is a popular bridge solution between the Solana blockchain and other leading DeFi networks. Like ICON, Solana is a smart contract-based, proof-of-stake blockchain that offers much faster transaction speeds and much lower transaction fees than its most notable competitor, Ethereum.
Wormhole shares a number of similarities to BTP. For starters, both solutions are focused on connecting heterogenous blockchains, meaning blockchains needn’t share development patterns to transfer assets.
Wormhole and BTP also both support token wrapping, which is where a token is “locked” on the source blockchain and minted on the destination blockchain.
The key difference is that Wormhole does this in a conventional “permissioned” manner similar to many other bridging solutions. More specifically, Wormhole relies on a select group of “guardians” to approve transactions, something called a “multisig” requirement.
This might make cross-chain transactions easier to implement from a technical perspective, but it also creates potential security vulnerabilities — as Cointelegraph pointed out, multisig solutions are “one small slipup” away from disaster. And indeed, hackers took Wormhole for a cool USD 326 million in February.
BTP, on the other hand, is completely trustless. It does not rely on handpicked operators to approve transactions, making cross-chain transactions as secure as the blockchains involved. This might be more difficult to implement — note that BTP is still under development, while Wormhole is a fully deployed solution — but with permissioned bridge solutions falling increasingly under attack, BTP seems to point the way forward.
RenVM
Another innovative interoperability solution sometimes raised when discussing BTP is RenVM, a virtual machine that runs on a layer 2 protocol but on Ethereum. Like BTP, it can transfer assets across heterogenous blockchains, including Bitcoin, Ethereum, Dogecoin, Polygon and Tether.
RemVM claims to be able to “instantiate a decentralised, permission-less, and trust-less custodian capable of locking assets on one chain and minting one-to-one pegged representations of them on other chains.” In this regard, RemVM operates a bit like BTP or Wormhole by utilizing a “lock and mint” approach.
RemVM is certainly a decentralized approach, relying on thousands of verifiers called “darknodes.” Darknodes need to put up a 100,000 REN (about USD 13,000) bond to ensure good behavior and restore lost assets in the event of an incident.
However, whether this truly represents a “trustless” approach is a matter of debate. In addition to the bond to keep darknodes honest, ReVM uses several other technical features to make attacks extremely difficult, if not impossible. Still, the solution requires a network to approve transactions, making an attack at least theoretically possible, albeit highly, highly unlikely.
With BTP, everything is controlled by smart contracts, leaving little room for human error or mischief. As we’ve stated earlier, the security of cross-chain transactions is as good as the blockchain engines involved.
Blockchain is still very much a technology in development, and interchain solutions very much so. BTP, Cosmos IBC, Wormhole and RenVM are evolving solutions that seek to bring true interoperability to the blockchain space in their own unique ways. While each has their own strengths, BTP nevertheless has the potential to be transformative by bringing new levels of interchain interoperability between heterogeneous networks in a completely trustless manner.
