5 Cross-Chain Bridges Powering the DeFi Movement

Here are some of the chains implementing bridges on Ethereum:

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The growth of decentralized finance (DeFi) has seen the expansion of blockchains. Most of the third generation blockchains offer better throughput and costs compared to Ethereum currently.

However, most of these blockchains have added support for Ethereum, with Ethereum Virtual Machine (EVM) compatibility. As a result, bridges have been implemented to enable cross-chain movements with the leading DeFi blockchain.

Here are some of the chains implementing bridges on Ethereum:

Tezos

Tezos has the Tezos Wrap Protocol Bridge which provides a brdge to Ethereum utilizing wrapped tokens.

A wrapped token is a cryptocurrency token pegged to the value of another crypto. It’s called a wrapped token because the original asset is put in a wrapper, which can be thought of as a digital vault that allows the wrapped version to be created on another blockchain.

Tezos Wrap Protocol Bridge lets users wrap ERC20 and ERC721 tokens for use on Tezos.

Binance Smart Chain

Binance Bridge lets users convert their crypto assets into Binance Chain and Binance Smart Chain wrapped tokens. It also let’s them convert back to the original token type.

This is made possible by the concept of wrapped tokens which lets you convert selected coins into wrapped tokens (or “pegged tokens”) to be used on Binance Chain and Binance Smart Chain.

As a result, it is now possible for you to use BTC, ETH, USDT, or other assets in Binance Smart Chain (BSC) DApps.

The service has a portal that enables users with native tokens to access cross-chain liquidity on Binance Chain and Binance Smart Chain with just a few clicks.

For example, if you transfer USDT from Ethereum to Binance Smart Chain, Binance Bridge will support the cross-chain conversion of Ethereum ERC-20 to Binance BEP-2 or BEP-20.

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SEE ALSO: Introducing Neon – an EVM Solution Allowing Ethereum dApps Transaction Processing on Solana

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Solana

Solana’s increasing popularity can be attributed to its cross-chain functionality. One cross-chain facility is its Wormhole Bridge.

The Wormhole Token Bridge connects Ethereum and Solana letting users interchange assets across both blockchains.

The interoperability protocol helps crypto assets like tokens and non-fungible tokens (NFTs), and even price data, flow between blockchain networks that don’t usually talk to each other.

Wormhole also supports Terra, Ethereum and Binance Smart Chain.

Avalanche Network

In July 2021, Avalanche launched a cross-chain interoperability protocol referred to as Avalanche Bridge.

The Avalanche Bridge has a simple process that lets users transfer ERC-20 tokens from Ethereum to Avalanche’s C-Chain and vice versa.

Bitcoin Cash

Smart Bitcoin Cash (smartBCH for short) is a sidechain for Bitcoin Cash. It is compatible with Ethereum’s EVM and Web3 API and provides high throughput for DApps in a fast, secure, and decentralized manner.

Coinflex, a cryto asset exchange, powers a SmartBCH bridge that makes it possible to wrap bitcoin cash (BCH) for use in DeFi.

Coinflex is available via MetaMask where users can swap Bitcoin Cash for SmartBCH.

Other blockchains implementing cross-chain functionality with Ethereum using bridges include:

  • Polygon
  • Cosmos
  • Near
  • Optimism
  • Harmony
  • Fantom

Users should be careful when transferring funds across bridges as funds can get lost if mistakes are made.

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RECOMMENDED READING: DeFi: A Comprehensive Explainer

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