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What Are Cross-Chain Bridges?
Shailee Adinolfi
&
Annie Pei
General Wallet Use
Cross-chain bridges are protocols that facilitate communication and asset transfers between different blockchains. You can think of them as bridges connecting two islands, allowing people to travel between them. Similarly, crypto bridges enable two distinct crypto networks to share information and collaborate.
What are Cross-Chain Bridges?
Cross-chain bridges are protocols that allow data and crypto tokens to be exchanged between different blockchains.
For example, a bridge could allow BTC to be ported to the Ethereum blockchain by locking BTC on the Bitcoin chain and minting tokens on Ethereum that represent the locked BTC. Without bridges, each blockchain operates on its own digital island.
Types of Cross-Chain Bridges
Trusted bridges — requiring a trusted third party.
Trustless bridges —direct, P2P using smart contracts.
Unidirectional bridges — bridging only in one direction from chain A to chain B.
Bidirectional bridges — allowing assets to be exchanged in both directions between blockchains.
Why Cross-Chain Bridges Are Needed
As an integrated, multi-chain ecosystem becomes more desirable for builders and users, bridges will continue to become more important. Moving digital assets like Bitcoin or NFTs between different blockchains would be impossible without bridges. Here's why you might want to use a cross-chain bridge:
Speed — A user may want to use their assets on a blockchain that completes transactions faster.
Cost — Some blockchains have higher fees than others, bridging to save on gas fees can help.
Utility — some platforms and markets are only available on certain blockchains, creating the need to move tokens to the desired chain.
How Do Cross-Chain Bridges Work with Leather?
One of the best types of wallets for using bridges are self-custody wallets. Sometimes called non-custodial wallets, they align with the principles of decentralization and crypto. Both software wallets like MetaMask and hardware wallets like Ledger or Trezor can work with cross-chain bridges.
Leather gives users the opportunity to interact with cross-chain transactions through a number of integrations. This includes Allbridge, which connects users on EVM to non-EVM chains, and newer Stacks-based projects that emphasize cross-chain functionality like TeleportDAO.
As with everything in crypto, new protocols and platforms tend to pose new threats. Using bridges with your crypto wallet is no exception. Be sure to understand potential security concerns, particularly when using bridges that involve custody of assets by third parties.
Trusted bridges, in particular, may require users to give up control of their assets during the bridging process. This creates a significant risk if the custodial entity faces vulnerabilities. For trustless bridges — make sure to minimize the possibilities for user error, accidental transactions, and potential code errors.
Trustless bridges are intended to mitigate custody risks by operating solely on smart contracts and algorithms. This and other developments are always working to shore up vulnerabilities. But it’s always important to interact carefully and safely with dApps and protocols.
Conclusion
If you’re getting involved with DeFi and trying different platforms, technologies, and markets, get yourself a Leather wallet. Our non-custodial Bitcoin wallet will give you the flexibility you need to access all your assets.