It just got a whole lot easier for banks to do business with bitcoin.

Yesterday, Ripple open-sourced the first bitcoin plug-in for its Interledger protocol (ILP), designed to seamlessly let users conduct transactions across a wide range of ledgers.

By open-sourcing the bitcoin tool, along with another plug-in for enterprise-focused platform Chain, Ripple was able to conduct, in a live demo, a single transaction across seven different ledgers. Conducted at the Blockchain Expo in Berlin, Germany, the single transaction went across public blockchains, private blockchains, a centralized ledger and a traditional payment channel.

While no single transaction would likely ever require so many ledger integrations, Ripple CTO Stefan Thomas said the purpose of the demo was to show future users that traditional channels can work in harmony with distributed ledgers.

Thomas said:

“We think that’s where the future is going. We think that in the future all different ledgers will be tied together and transactions will be very seamless. So we want to make sure that our customers are going to be set up for success in that world.”

In addition to the newly open-sourced bitcoin and Chain integrations, an Interledger transaction for a “relatively small” value was also conducted with Ripple’s native currency, XRP, using both an XRP escrow and an XRP payment channel. Ethereum, Ripple’s centralized Five Bells Ledger and a so-called ‘trustline’ were also used in the transaction.

The payment was converted from fiat to ether to XRP to euros, depending on the payment channels, with Interledger’s connectors converting the currency and forwarding the payments from one ledger to another.

Interoperability in sight

The Interledger demonstration is part of an overall industry trend towards merging blockchains –one that has gained significant momentum this year.

In the last month alone, Blockstack launched its decentralized browser designed to let any number of blockchains mesh into a distributed version of the internet, and 0x launched an alpha version of its token trading platform built to allow decentralized applications to seamlessly interact by instantly exchanging their native tokens.

Co-inventor of the ILP and managing director of Ripple’s Luxembourg office, Evan Schwartz, positions the demonstration as part of a bigger-picture push to show blockchain interoperability has moved past being just a good idea.

“What this shows is that with this kind of architecture that Interledger has, it’s not just about integrating two ledgers, it’s about doing this across many types of ledgers,” Schwartz said.

Warming to cryptocurrency

Ripple initially released the ILP in October 2015, at a time when banks were even more wary about doing business with cryptocurrencies and had only just begun to explore non-cryptocurrency applications of blockchain technology.

Since the launch, banks have shown increasing interest in working with a wide range of distributed, shared databases and specifically blockchains, even if their willingness to transact in cryptocurrency remains largely stifled by concerns surrounding know-your-customer (KYC) compliance.

Ripple has, in part, helped overcome this reluctance by working with banks to build a wide range of early-stage products relying on its distributed ledger technology, but not its native currency.

Going forward though, that could change if the hesitance surrounding cryptocurrency lessens. This seems likely, because some banks around the world have already begun accommodating bitcoin companies that want to open fiat accounts. Ripple itself has even started building bank applications that rely on XRP, so the company seems to be preparing for a future of much broader acceptance.

“Bitcoin is one of the most widely used and one of the most well-known ledgers,” said Thomas. “So any interoperability protocol has to be measured by [whether] it supports bitcoin, if it supports XRP, if it supports ethereum.”

Plug-in workshop

By the end of today, Ripple expects an eighth connector to be built at the Berlin event, one that would enable integration with litecoin. The process, according to Ripple executives, would take only a slight tweak of the bitcoin tool’s code.

The firm further said a building session will take place, one in which it expects technologists from zcash, Lightning Network, GateHub, BigchainDB, PayPal and Monax’s Hyperledger Burrow to create yet more plug-ins.

Zcash and Monax have confirmed to CoinDesk that each will have a blockchain engineer in attendance to assist with the work.

Thomas concluded:

“We want to make our customers happy, we want to act in the interest of our customers, and so part of that on our side – we’re all in the research department – means thinking about what our customers are going to want before they even realize it.”

Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Chain.

Patchwork quilt image via Shutterstock