Though the layperson might know about Bitcoin and Ethereum, there are hundreds of other blockchains – all with their unique nuances, twists, and assets.. And in this era of many chains, that has created a problem for crypto maximalists.
That problem? Getting assets between chains. See, you can’t just send assets from Ethereum to a Bitcoin address… nor can you directly transfer assets from Solana to Polygon. Attempting to send your assets from one chain to another without some extra steps will certainly result in loss of funds – and that’s bad news.
That’s one reason behind the emergence of bridges, a technology which adds interoperability between chains. Bridges help users move assets that they have on one chain to another – and this has opened up a world of possibilities for ardent crypto traders, speculators, DeFi tinkerers, and arbitrageurs.
In short: if one bridge, or many bridges, add support for a blockchain, it could mean a flurry of capital inflows to its ecosystem. Emergent blockchains such as Fantom, Avalanche, and Polygon can credit a healthy portion of their success to bridges.
That’s why one bridge’s decision to add support for the Polkadot parachain Acala, as well as its Kusama-based counterpart Karura, is potentially huge. As per the latest announcement, Wormhole will add the support for these chains – opening up a bridge between these new additions and existing giants such as Ethereum, Avalanche, Terra, Solana.
Wormhole integration will allow users to send tokens to-and-from Acala and Karura. After that, tokens can be either converted into Polkadot and Kusama native assets or used as collateral to mint aUSD (a decentralized stablecoin on Polkadot) and kUSD (a Kusama stablecoin) tokens.
Karura will be the first to join Wormhole, followed shortly after by Acala. As soon as the bridge goes live, the networks will be opened up to outside capital – which numbers in the billions.
However, while Wormhole’s added support for these chains will certainly play a role in their growth, bridges have been shown to have security shortcomings. Wormhole specifically was afflicted by serious security vulnerabilities in the past when its Solana bridge was exploited in February, allowing a thief to make off with 120,000 Ethereum (worth $322 million at the time). As the demand for cross-chain interoperability solutions is set to remain high, addressing the security issues in due course is important so that the blockchain ecosystem can function smoothly.