Cross-Chain Bridge
A cross-chain bridge is a protocol that enables the transfer of assets or data between two different blockchain networks. Because most blockchains are siloed, bridges are necessary to allow liquidity to flow across the ecosystem.
They typically work by locking assets on the source chain and minting a wrapped version on the destination chain. This process relies on various trust models, ranging from decentralized multi-signature schemes to centralized custodial entities.
Bridges are critical infrastructure but are also prime targets for exploits due to the complexity of their smart contracts. They represent a significant point of systemic risk, as the compromise of a bridge can lead to the loss of vast amounts of locked capital.
Managing bridge security requires rigorous auditing and robust incentive design to ensure long-term stability.