Author: Patrick McCorry; Translator & Proofreader: Min Min & A Jian
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What is a "bridge"?
In this article, I want to discuss a component that is fundamental to all off-chain protocols. This component is often overlooked, but is critical to asset security:
The role of the "bridge" is to hold assets on the Layer 1 blockchain while issuing them on another (external) service. It specifies the asset custodian and the conditions for unlocking the asset.
In short, Layer 1 blockchains (such as Ethereum) use "bridges" to connect to other systems. All "bridges" perform similar operations:
- deposit. Users can deposit funds on the "bridge", and map this asset to another system through the "bridge".
- Update user balance. The "bridge" is notified of updated account balances and uses them for the withdrawal process.
- withdraw money. Users can withdraw funds to the Layer 1 blockchain through the "bridge", and at the same time destroy the corresponding balance on the other system.
- The vast majority of cryptocurrency exchanges are"bridge" -
If we only consider the definition of "bridge", we can safely say that a cryptocurrency exchange is an off-chain protocol. Users can lock funds in the protocol, avoiding gas fees and network delays during transactions, and finally withdraw the balance to the Layer 1 blockchain.In addition to single-organization bridges, there are two types of bridges that rely on multiple custodians:
- Multiple tissue bridges. Locked funds are entrusted to a fixed set of independent participants (K/N).
- Cryptoeconomic Bridge. Locked funds are entrusted to a dynamic set of participants, depending on the asset weight of those participants.
Sidechains and "bridges" are independent of each other
- "bridge"and sidechains are securely independent of each other -
Some existing "bridge" projects are listed below:
- WBTC: Single organization bridge to transfer BTC to Ethereum.
- Liquidity Network or RSK: A multi-organizational bridge to transfer BTC to/from other blockchains by consortium members deploying Hardware Security Modules (HSMs).
- Polygon bridge: a cryptographic economic bridge, in which verifiers need to regularly reach a consensus on the account balances of all Polygon users with no less than 2/3 + 1 of the total pledge amount, and users can withdraw funds to Ethereum according to the consensus. (Actually, Polygon is ultimately controlled by a small multi-signature contract, but the focus here is on its long-term goals).
- Rainbow Bridge: Cryptoeconomic bridge, where the bridge contract is a light client that can verify the state changes of another blockchain. It will not verify the validity of another blockchain, and the security of assets ultimately depends on the continuous state changes of another blockchain (guaranteed by cryptographic economic mechanisms).
Most importantly, each bridge has its own security model and is independent of the blockchain network. We can give a simple example WBTC to further elaborate:BitGo Trust is responsible for keeping the locked BTC and issuing an equivalent amount of WBTC on Ethereum. Smart contracts on Ethereum track the balances of all accounts involved in WBTC transfers. Users need to trust that BitGo will respect the account balance recorded in the smart contract.
As far as WBTC is concerned, we need to consider the following:- Single Custodian. The WBTC bridge relies on a single custodian for its integrity. The custodian can over-issue WBTC on Ethereum, or refuse to return BTC.
- Independent security model. Ethereum's security model is independent of Bitcoin. The security model of the WBTC bridge is independent of these two blockchains.
- Use Ethereum as a sidechain. When cross-chaining from Bitcoin to Ethereum, transactions are moved off-chain.
wait. What is the relationship between the Layer 2 protocol and the "bridge"?
The scalability promise of Layer 2 is to move transaction throughput from Layer 1 blockchains to off-chain systems. The role of the "bridge" is to take custody of the assets and map them onto another system.However, unlike all the "bridges" mentioned above, the Layer 2 protocol seeks to provide the same level of security as a Layer 1 blockchain for the funds in its custody, and it cannot rely on a set of custodians (or another off-chain system ) to protect funds.This requires a whole new type of "bridge":
- Layer 2 bridge. Funds are hosted on a Layer 1 blockchain, and the "bridge" must be able to confirm that the Layer 2 protocol has not been compromised. In the worst case, the "bridge" will self-enhance the activity of the Layer 2 protocol until all funds can be withdrawn.
Layer 2 bridges are the most powerful of all "bridges".
- Some companies working on the development of Layer 2 bridges to create a new blockchain network -
This is why Layer 2 protocols are so exciting that the aforementioned companies have spent years working on Layer 2 solutions. These companies are striving to be the first to launch Layer 2 protocols. This competition is primarily focused on how to implement a secure Layer 2 bridge (and not necessarily how to implement another blockchain network).This is a good opportunity to further explore the technical issues and definitions of "bridge". We have made it clear that the "bridge" must have a way of determining that the Layer 2 protocol has not been broken. The situation where the Layer 2 protocol is broken can be summarized into the following four types:
- data availability. How does the "bridge" ensure that all data of another blockchain network is publicly available so that users can independently recompute the Layer 2 database?
- State transition integrity. How do we convince the "bridge" that all state transitions of the Layer 2 network are legal and valid?
- Withdrawal Integrity. When the Layer 2 network is compromised, how does the "bridge" guarantee that all honest users can get their funds back?
- Protocol activity. When the Layer 2 protocol is suspended or disconnected, how does the "bridge" ensure that the transaction can still be executed?
Of course, the above problems must be resolved. At the same time, since bridge contracts have far fewer computing resources than off-chain systems, bridges cannot re-execute all transactions in real time. Otherwise, it's not a scalability solution.Solving the above problems is like falling into a bottomless rabbit hole. You need to face many problems such as on-chain challenges, fraud proofs, validity proofs, and publishing transaction data to the Layer 1 blockchain (rollup).
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bridge"bridge"will help us to the moon -
As discussed in this article, there are four types of "bridges". They can lock funds in one blockchain and map them to another off-chain system (or even another blockchain).Managed bridge. The first three types of "bridges" focus on determining which custodians control the locked assets. It is the role of the custodian to verify that the off-chain system is correct before allowing users to retrieve funds escrowed in the "bridge". Escrow bridges assume that the integrity of the off-chain system is a client-side issue and that the custodian has enough computing power to handle it. While there are additional measures to reduce custodian responsibilities, or introduce cryptographic economic incentives to encourage custodians to comply with the protocol, bridge protocols cannot fully constrain custodians. There have been several incidents of bridges losing user assets (like the MtGo exchange), and this is because the integrity of bridges ultimately depends on trust.Layer 2 bridge.The "bridge" completely replaces the custodian to keep the funds and verify the integrity of the off-chain system. The core problem is that the "bridge" must ensure that the off-chain system has not been compromised. At the same time, it lacks the computing power to independently verify each transaction (otherwise it would not be a scalable solution). In addition to bringing huge technical challenges, Layer 2 bridges also have high costs. In order for the Layer 1 blockchain to believe that the off-chain system is legitimate and complete, the Layer 2 bridge will continue to incur economic costs. However, in the end, the "bridge" will be the custodian of funds, while the operator of the off-chain system has no right to custodian.All in all, do users really care about Layer 2 bridges? Should we extend Ethereum's security model to off-chain systems? These questions are inconclusive. I think these four types of "bridges" are here to stay because of their importance in increasing user adoption.I hope that every user can pay attention to "bridges" and think about what kind of "bridges" their favorite protocols use. This helps users better understand how the protocol they are using is protecting their funds.
