One of the prerequisites for large-scale adoption of blockchain technology is interoperability – the ability to pass data between different blockchains and blockchain-like systems. Today, a number of interoperability projects have been established, many of which are growing at an incredible rate. In fact, it’s only a matter of time before the number of cross-chain messages reaches the trillions.
Blockchain interoperability has never been more prevalent. in January 2024, more than $23 billion in assets were locked up in cross-chain bridges on Ether alone. It’s clear that early adopters in our industry – affectionately known as Web3 enthusiasts – are keen to explore new ecosystems as they routinely connect assets from one blockchain to another. The process, while clunky, has become so commonplace that many believe blockchain interoperability is a solved problem.
The truth is much bleaker.
Blockchain interoperability today is a fractured state of incompatibility. Competing interoperability projects build ad hoc solutions that unfairly impact the blockchain landscape, making it impossible for companies and regulators to review the security of each project. As it stands, the current state of blockchain interoperability poses an existential threat to the mainstream adoption of blockchain technology as a whole.
Modern interoperability projects are too focused on building and developing their own proprietary products. The struggle to be unique has introduced increasing system complexity and therefore unlimited risk. The complexity of blockchain interoperability protocols continues to grow as different projects make different tradeoffs to solve different problems. Not only does this complexity make protocols increasingly incompatible with each other, but each new system component or trust assumption introduces new attack vectors. As an industry, we must curb this disturbing trend.
A shared framework for interoperability is urgently needed.
As a trust-less system, decentralized blockchains cannot communicate with other blockchain networks out-of-the-box. Trust assumptions determine the risk profile of a given cross-chain design by shaping its vulnerability and describing how the system can be exploited. In general, the more complex the system, the more vulnerable it is to attack. Therefore, it is advisable to simplify the design of cross-chain solutions to limit the number of exploitable components. Thus, while trust assumptions are inherent in blockchain interoperability solutions, simplicity has security.
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A shared framework for interoperability between blockchain and blockchain-like systems – including architectural guidelines and vetted interface definitions – makes it possible to reduce system complexity. This has the knock-on effect of preventing fragmentation across different project implementations. Even something as simple as public interfaces and functions for decoding and verifying the validity of messages greatly enhances interoperability while reducing the need for custom implementations.
A shared framework for interoperability also has the potential to facilitate collaboration between different interoperability projects. Broadly speaking, an interoperability project is one that does not trust each other’s work. This is not entirely surprising considering that more than $2.9 billion was stolen from cross-chain bridges between 2021 and 2023. However, this distrust is a direct result of the fractured state of blockchain interoperability today. A shared framework that is publicly established and vetted by all will yield a more secure system.
Blockchain interoperability must be a core infrastructure first and a product second. If we as an industry have any hope of achieving mainstream adoption of blockchain technology (without sacrificing the industry’s core ethos of decentralization), we must build a shared interoperability framework. Time is running out.
