Users can transfer cryptocurrency between two blockchains because of a bridge that connects them. Basically, you can use the bridge to spend BTC crypto-coin like Ethereum (ETH) if you have it. Blockchain's inability to collaborate was one of its main problems. Each blockchain, while flexible and relatively efficient as stand-alone entities, is limited by its own domain boundaries.

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_{Image taken from Pixabay}

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Often, this can result in costly transactions and congestion. This problem is solved by blockchain bridges, which allow the transfer of crypto tokens, data exchange and smart contracts, as well as other feedback and instructions between two separate platforms.

This bridge acts as a neutral zone so that users can easily transition between the various coin technology processes and operational paradigms of these blockchains. For the majority of us, access to multiple blockchains through the same network dramatically improves the cryptocurrency experience.

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ITS NEED IN BLOCKCHAINS

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Each blockchain has its own rules, as I said above. Blockchain bridges help bridge these divides and connect different crypto ecosystems. Tokens and data can be easily exchanged between interconnected blockchains. In other words, blockchain bridges will be necessary if the blockchain industry is to become interoperable in the future.

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BENEFITS AND WORKING OF BLOCKCHAIN BRIDGES

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If we talk about the benefits of blockchain bridge, they are numerous, but we will talk about some of them.

• INTEROPERABILITY

The ability to enhance interoperability is a key benefit of blockchain bridges. They make it possible to transfer tokens, assets and data between separate sidechains, Layer 1 and Layer 2 protocols and other blockchains.

• SCALABILITY

Blockchain bridges also help increase scalability. Some blockchain bridges can process multiple transactions simultaneously, increasing productivity. A bridge also removes consensus and other ecosystem-specific restrictions, making blockchains infinitely scalable.

• FASTEST & LOWER COST

This is another advantage of the blockchain bridge. When there is a lot of traffic, DApp developers who use Ethereum frequently face problems with poor user experience. They can use a bridge to send their token to another blockchain for faster and lower cost processing.

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WORKING OF BLOCKCHAIN BRIDGES

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Blockchain Bridge will hold your BTC and generate Ethereum equivalents when you have BTC and want to transfer some of it to ETH. In reality, none of the crypto involved changes hands. Instead, the required amount of Bitcoin (BTC) is locked into a smart contract, and you are given access to an equivalent amount of ETH. The Ethereum (ETH) coin you had, or whatever is left of it, will be burned when you want to convert back to Bitcoin, and the Bitcoin equivalent will be returned to your wallet. So this is the main function of blockchain bridges.

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TYPES OF BLOCKCHAIN BRIDGES BY CATEGORY AND ONE EXAMPLE

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Blockchain bridges are categorized into two categories. One of the is custodial (centralized) and other one is non-custodial (decentralized).

• CUSTODIAL BRIDGES

Users of custodial bridges must be confident that the system will be operated efficiently and safely by one party. Consumers should investigate the organization thoroughly to verify its reliability.

• NON-CUSTODIAL BRIDGES

They work independently of each other. For crypto mining and locking, they rely on smart contracts, so there's no need to rely on a single operator to make sure everything runs smoothly. In this type of bridge, the security and integrity of the system is maintained.

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AVALANCHE BRIDGE (EXAMPLE)

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When transferring crypto between Avalanche (AVAX) and Ethereum (ETH), Avalanche Bridge is a fast, secure and great option. Users can make cross-chain transfers between Avalanche and Ethereum using the Avalanche Bridge in an easy way.

When user will transfer an ERC-20 token to an Avalanche Bridge Ethereum address. The transaction is then verified by the wardens and the secure enclave. Once a wrapped ERC-20 token is verified on Avalanche, it is sent to a specific address. Return method is slightly different from send method let's see.

Avalanche Bridge's C-chain wallet receives no assets. By calling a method on a smart contract, they are simply burnt as opposed to anything else. A native ERC-20 token is then unlocked on Ethereum and transferred to the target address after it expires.

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LIMITATIONS & FUTURE OF BLOCKCHAIN BRIDGES

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Yes, blockchain bridges have some limitations. So lets see these limitations one by one.

• RISK OF HACKERS

Attackers have exploited loopholes in the smart contracts of many blockchain bridges. Hackers have taken huge amounts of cryptocurrency from cross-chain bridges. Keeping this in mind we can say that the risk of hacker is one of the limitations of blockchain bridge.

• TRANSACTION RATE BARRIERS

Transaction rate constraints are an additional potential technological barrier. Large-scale blockchain interoperability may be hindered by single-chain constraints in throughput capacity.

• PROTOCOL RISKS

Blockchain bridges can put underlying protocols at risk from trust gaps. Because blockchain bridges connect many blockchains together, the security of connected systems is only as strong as its weakest link. So this is some limitations of blockchain bridges.

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FUTURE OF BLOCKCHAIN BRIDGES

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The future of blockchain bridges are very bright, because the Internet could undergo a revolution due to interoperability. Blockchain bridges are critical to increasing the interoperability of blockchain networks and, ultimately, their widespread adoption. In terms of users, bridges, and overall transaction volume, these bridges have shown impressive growth. Blockchain Bridge's future growth will coincide with the Internet's transition to Web3.