![]() They then use currency to get the other desired type of cryptocurrency, incurring more fees and taking time. Without the use of a cross-chain bridge, users must first convert a cryptocurrency token into a fiat currency, which often involves fees. ![]() In the world of blockchains, a cross-chain bridge serves an analogous purpose.Įxchange across different blockchains for cryptocurrency is possible without a cross-chain bridge, but it is expensive and more time-consuming. Those systems include financial institutions, banks and credit cards that handle foreign exchange. With fiat currency there are many established ways for individuals and businesses to exchange money, creating a globally available and interoperable system of financial payments. It enables the flow of data and tokens across what would otherwise be siloed sets of data on different blockchains. What is a cross-chain bridge?Ī cross-chain bridge enables an exchange of information, cryptocurrency or NFTs from one blockchain network to another. Enabling interoperability and exchange across different blockchain networks is an area where cross-chain bridges - sometimes also referred to as blockchain bridges - play an increasingly important role. There are many blockchain networks and cryptocurrencies that use different blockchain technologies, including Bitcoin, Ethereum, Avalanche, Polygon, Solana and Arbitrum. Blockchain networks enable many types of services, including secured databases, immutable ledgers, decentralized applications ( dApps), decentralized finance ( DeFi), non-fungible tokens ( NFTs) and cryptocurrencies. Blockchain is a distributed ledger technology that uses cryptography to provide assurance and integrity to data and transactions.
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