Cross-Chain Bridge

Also known as federated or custodial bridges, these rely on a centralized entity or a permissioned set of validators to hold user funds and attest to cross-chain events. Users must trust this intermediary to be honest and secure.

• Security Model: Based on the reputation and security of the custodian(s).
• Examples: Early versions of Binance Bridge, Wrapped Bitcoin (WBTC) on Ethereum (custodied by BitGo).
• Trade-off: Typically faster and cheaper but introduces significant counterparty risk.

These bridges operate using the underlying blockchains' native cryptographic verification. They rely on light clients or relayers to prove the state of one chain on another, removing the need for a trusted third party.

• Security Model: Inherits the security of the connected blockchains.
• Mechanism: Uses Merkle proofs (e.g., Merkle Patricia Proofs) to verify transactions and state.
• Examples: The Rainbow Bridge (NEAR <> Ethereum), IBC (Inter-Blockchain Communication) protocol used by Cosmos.
• Trade-off: More secure but can be complex and resource-intensive to implement.

This architecture introduces a dispute period or challenge window after a cross-chain message is relayed. During this window, anyone can submit fraud proofs to challenge invalid state transitions, similar to Optimistic Rollups.

• Security Model: Assumes honest watchers exist to submit challenges; security is cryptoeconomic.
• Benefit: Reduces operational costs by only requiring full verification in case of a dispute.
• Examples: Nomad bridge (prior to its exploit), some implementations of arbitrary message bridging.
• Trade-off: Introduces a significant delay (often 30 mins to 7 days) for finality due to the challenge window.

Also called Lock & Mint / Burn & Mint bridges. These bridges use liquidity pools on both chains and a liquidity provider (LP) model. Assets are not "locked" in a single custodian contract but are pooled.

• Mechanism: Users swap assets via an Automated Market Maker (AMM) on the destination chain. The bridge protocol manages the net flow of liquidity between pools.
• Security Model: Relies on the security of the underlying smart contracts and the economic incentives of LPs.
• Examples: Multichain (formerly Anyswap), Stargate, Synapse Protocol.
• Trade-off: Enables fast transfers but can face liquidity fragmentation and slippage issues.

Many modern bridges combine multiple architectural models to optimize for specific trade-offs between security, speed, cost, and generality. They often use one model for verification and another for liquidity.

• Common Patterns:
  • Trustless verification (e.g., light clients) paired with liquidity networks for fast settlement.
  • Optimistic message passing for general data, with trusted fast lanes for high-value assets.
• Examples: LayerZero's Ultra Light Node model, Wormhole's Guardian network with optional slow/fast paths.
• Goal: To provide a flexible framework that can be configured for different use cases and risk profiles.

A peer-to-peer, non-custodial method for exchanging assets across chains using Hash Time-Locked Contracts (HTLCs). It's a pure cryptographic swap without an intermediary bridge contract holding funds.

• Mechanism: Two parties agree to swap. One locks funds with a secret hash. The other locks funds on the other chain, which can be claimed with the same secret, ensuring atomicity—either both transactions succeed or both fail.
• Security Model: Trustless, based on game theory and timeouts.
• Use Case: Best suited for direct, large-value swaps between two parties.
• Limitation: Requires liquidity and counterparty discovery, making it less suitable for general asset bridging.

Assets are locked or burned on the source chain and equivalent wrapped assets are minted on the destination chain. This model relies on a centralized custodian or a federated multi-signature set of validators to hold the locked assets and authorize mints.

• Example: Wrapped Bitcoin (WBTC) on Ethereum, where BitGo acts as the custodian.
• Trade-off: High efficiency but introduces counterparty risk and requires trust in the bridge operators.

Uses liquidity pools on both chains. Users swap assets via these pools without a central custodian. Security depends on the economic security of the underlying Automated Market Maker (AMM) and the liquidity providers.

• Example: Stargate Finance, built on LayerZero, uses a delta algorithm for pooled liquidity.
• Trade-off: Reduces custodial risk but can be constrained by pool depth and is susceptible to liquidity provider risks.

Employs light clients (simplified blockchain verifiers) and relayers to cryptographically verify state proofs from the source chain on the destination chain. This model aims for cryptographic security without trusted intermediaries.

• Example: The IBC (Inter-Blockchain Communication) protocol used by Cosmos SDK chains.
• Trade-off: Highest security in theory, but can be complex to implement and may have higher latency for proof verification.

Inspired by optimistic rollups, this model assumes transactions are valid unless challenged. A network of watchtowers or attestors can submit fraud proofs during a challenge period to invalidate malicious transfers.

• Example: Nomad Bridge (prior to its exploit) used an optimistic security model with a fraud-proof window.
• Trade-off: Can offer lower operational costs but introduces a withdrawal delay and relies on active watchtowers for security.

General-purpose bridges that enable the transfer of arbitrary data and contract calls, not just tokens. They are the infrastructure for cross-chain decentralized applications (dApps).

• Example: LayerZero is an omnichain interoperability protocol that enables smart contracts on different chains to communicate directly.
• Core Concept: Uses an Oracle and Relayer pair for decentralized message delivery and verification.

A dedicated, independent set of validators runs a consensus mechanism specifically to secure the bridge. They sign attestations for state transitions between chains.

• Example: Polygon (PoS) Bridge uses a set of Heimdall validators to secure transfers between Ethereum and Polygon.
• Trade-off: Security is decoupled from the connected chains but depends entirely on the economic security and honesty of its own validator set.

A trustless method for exchanging cryptocurrencies across different blockchains without an intermediary. Unlike bridges, which lock and mint tokens, atomic swaps use Hash Time-Locked Contracts (HTLCs) to ensure the trade either completes entirely or fails, with funds returned.

• Key Feature: Peer-to-peer, no custodial risk.
• Limitation: Requires both chains to support the same cryptographic hash function (e.g., Bitcoin and Litecoin).

A protocol standard for secure message passing and value transfer between sovereign, heterogeneous blockchains. Pioneered by the Cosmos ecosystem, IBC enables interoperability through a standardized packet structure and light client verification.

• Key Feature: Maintains blockchain sovereignty; no central bridge contract.
• Example: Transferring ATOM from the Cosmos Hub to Osmosis.

An omnichain interoperability protocol that enables lightweight message passing between blockchains. It uses a decentralized oracle network and relayer system for verification, aiming for a trust-minimized design without a central mint/burn contract.

• Key Feature: Ultra Light Nodes (ULNs) allow chains to verify the state of another chain efficiently.
• Use Case: Powering native asset bridges like Stargate Finance.

A generic message-passing protocol that connects over 30 blockchains. It uses a network of Guardian nodes (a decentralized set of validators) to observe and attest to events on one chain, enabling state and asset transfer to another.

• Architecture: Employs a proof-of-authority model for its Guardian set.
• Core Function: The Wormhole Core Contract on each connected chain emits messages verified by Guardian attestations.