The S-word that dominated talk of blockchain shortcomings two years ago – ‘scalability’ – has been replaced by the I-word – interoperability. It’s the biggest problem that today’s blockchain projects are trying to solve, and the movement gained momentum this week with the launch of Syscoin’s Ethereum bridge. The decentralized bridging protocol enables the transferability of ERC20 tokens into the Syscoin ecosystem. As a result, network users can enjoy the best of both worlds: the smart contract capabilities that are inherent to Ethereum with the higher throughput and lower fees of Syscoin.

Bridging blockchains is a multi-faceted challenge that entails significant technical and logistical hurdles. Due to the different architecture of various blockchain networks, both public and private, and the trade-offs that each incorporates in terms of throughput and privacy, connecting chains is a huge undertaking. In the past, a ‘winner takes all’ mentality has led crypto projects, including smart contract platforms, to compete for dominance, jostling for market share and network users.

As the industry has matured, however, projects have increasingly acknowledged that they are not in a zero-sum game, and improved interoperability benefits everyone.

Bridging Blockchains Without Trade-Offs

Much of the progress that has been made in interoperability has been at the expense of decentralization. Generally speaking, utilizing assets on a non-native chain entails locking them into some kind of multisig or smart contract that is overseen by a custodian. This is the method used by Binance to issue crypto-assets such as BTC on Binance Chain, or in the issuance of wrapped bitcoin (WBTC) on Ethereum. Syscoin’s bridge is materially different, enabling Ethereum assets to operate on the Syscoin protocol without the need to custody them with a third party.

“We rightly chose Ethereum as the first subject to integrate [with Syscoin],” explains Jagdeep Sidhu, Syscoin co-founder and Lead Core Developer.

“With Ethereum being the most proven smart contract platform, and facing increasing pressure to scale, this is a mutually beneficial integration on more than one level. At a later stage, the Syscoin Bridge could be integrated with platforms other than Ethereum. We continually weigh the ecosystem benefits of various potential future integrations.”

Connecting the Dots and Crossing the Chains

Although crypto assets are portrayed as a global form of currency that can cross borders and bypass intermediaries, the reality isn’t always as utopic. The learning curve for beginners remains steep, requiring familiarity with wallet addresses, seed phrases, blockchains, and coin compatibility. Newcomers to crypto may be surprised to learn that the leading blockchains operate on separate tracks, and that crypto communities are largely siloed, operating independently from one another.

It will take further work before bridging protocols can facilitate seamless cross-chain transfers at the push of a button, making the technology suitable for everyday users. The amount of energy being expended on solving this problem, however, attests to the deep-seated desire for interlinked crypto islands, with causeways enabling value to hop from isle to isle quickly and easily.

When the interoperability problem is solved, blockchain engineers will turn their attention to the next challenge to rear its head. For now, though, bringing crypto ecosystems closer together remains an ongoing challenge that initiatives like Syscoin with its Ethereum bridge are seeking to remedy.