Blockchain 101: Cross-Chain Mechanisms (Part 1)

Ontology Gas | 11.23| 267

In our first entry for the Blockchain 101 series, we went through some of the basics about cross-chain and asked members of our community to explain what cross-chain means to them. In today’s entry, we will dig further into cross-chain; this time choosing to discuss the main approaches to cross-chain communication.

So let’s get started by introducing cross-chain mechanisms. There are 3 main cross-chain mechanisms that can be used: notary schemes, sidechains/relays, and hash-locking. With each scheme being complex, today we will focus solely on notary schemes.

In his Chain Interoperability paper, Vitalik Buterin states:

In a notary mechanism, a trusted entity or a set of entities that is trusted as a group is used in order to claim to chain X that a given event on chain Y took place, or that a particular claim about chain Y is true. Such entities may be active, listening, and automatically acting based on events in some chain. On the other hand, they may be reactive, issuing signed messages only when asked. The most advanced effort that has taken steps in this direction is the Interledger project developed by Ripple. Interledger, at least in what it describes as “atomic mode”, uses a Byzantine-fault-tolerant (BFT) consensus algorithm in order to achieve consensus among a set of notaries on whether or not a given event took place, and then issues a signature that can be used to finalize payments conditional on this consensus.

As Vitalik concisely put it, in the notary mechanism, Chain X and Chain Y cannot interoperate directly with each other. Instead, they need a trusted third party to verify and forward the cross-chain message between the two.

With this kind of cross-chain mechanism, the benefits are being simple to implement and flexibly able to support different types of blockchain systems, including homogeneous chains and heterogeneous chains (assuming the mechanism can access the information on that chain). However, the main downside to the notary mechanism is that the security of it is fully guaranteed by the trusted third party. As a result, the decentralized benefits of blockchain may be negated as risks related to centralization may occur.

We hope this has helped you better understand one of the core mechanisms behind cross-chain. Stay tuned for our next installment where we will discuss another interesting cross-chain mechanism, sidechains/relays.

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Blockchain 101: Cross-Chain Mechanisms (Part 1) was originally published in OntologyNetwork on Medium, where people are continuing the conversation by highlighting and responding to this story.

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