Author: Theo
I have become fascinated with interoperability between blockchains, or more precisely, the current market demand for it. But what could it lead to and why is it necessary at this time?
For me, a lot of the activity seems to be centered around two approaches:
One size fits all (universal)
Winner takes all
And it fosters an entire “maximization” attitude, which turns into a cult.
In its simplest terms, blockchain interoperability (or cross-chain, depending on who you read) allows different blockchain protocols to actively communicate with each other. As a result, different chains can interact and share data, making it easier to use different blockchain networks.
A common comparison is to email, where we send emails every day, and the greatest success of email is that someone with a Gmail account can send an email to someone with a completely different TLD account.
In the current state, no first-layer blockchain protocol can handle this type of processing. For now, most efforts have been directed towards providing the ability for applications to interoperate within the same protocol, but without bridging to other chains.
As I explained two months ago, I believe that the legendary problem is wrong, and the common belief that decentralized networks can only provide two out of three benefits at any given time, namely decentralization, security, and scalability, also complicates the situation because each chain deals with the so-called “blockchain trilemma” differently.
My view on this issue is that decentralization is not part of the solution, it is an inherent part of what blockchains and Web3 should achieve, and therefore should be removed from the equation to replace other things.
If one chain favors speed over security, then it is incompatible with another chain that favors security over speed. However, this is a larger challenge to solve, rather than just considering the triangle and why a one-size-fits-all chain is the wrong way to solve the problem. You can already see that the only metric that projects boast the most is TPS speed, which is the least interesting for many industries.
The demand for blockchain in healthcare will be different from the demand for manufacturing or supply chain, which will be different from the demand for pure financial transaction chains, which will be different from the demand for video games. Each industry has its own requirements that must be met, so putting a medical use case into a general or popular chain, rather than a chain specifically matched to the industry, is a huge mistake for me.
Currently, only a few projects, such as Cosmos, Polkadot, and Cardano, offer a certain degree of flexibility, trying to accommodate these differences and building interoperability between the first and second layer protocols from the start.
This means that the most popular blockchains in the market today may not be the right choice in the long run.
(Note – I do not have any position on any of the chains mentioned in this article, I just agree with the structure of some of the chains from an ideological perspective)
This is particularly important when considering that the metaverse should be a digital realm filled with interconnected and interoperable virtual worlds. When the movement between virtual economies and worlds should be seamless in the metaverse, the idea that current blockchains can easily interoperate with each other should raise many red flags.
In addition, it should also be claimed that there is an underlying chain to drive them. Because this means closed and centralized, rather than open and decentralized.
Similarly, a “one size fits all” protocol cannot win here because they cannot effectively meet every use case. For all the reasons mentioned above, there is no Swiss Army knife solution here. Time will tell where success and failure lie, and there should not be a single winner, otherwise, many metaverse and Web3 projects could be left in the corner, with no way to survive.
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