The solutions to the Interoperability Trilemma and verifying the flow of data between separate blockchains fall under two main categories:
- Centralised/Trusted Bridges
- Decentralised/Trustless Bridges
Centralised Bridges
Centralised bridges provide a solution to interoperability by compromising on the trustless component of the trilemma through External Verification; aka off-chain.
Off-chain verification can be through a single traditional centralised entity such as Bitgo acting as a custodian to bridge Ethereum and Bitcoin. It can also be through systems that aspire to decentralisation, but that nonetheless ultimately fail the trustless requirement, such as ChainBridge and its system of off-chain relays.
Decentralised Bridges
Decentralised bridges provide solutions to blockchain interoperability that are trustless but struggle to apply to any domain or any type of asset. There are two different approaches to decentralised bridges.
Locally Verified
The locally verified blockchain bridge solution assumes that each party to a cross-chain exchange assumes responsibility for verifying their counterparty. This type of bridge is trustless and can work across any domain, but is specific to exchanging a specific asset, so again trips up on the trilemma.
Natively Verified
Native verification of cross-chain transactions requires each blockchain to create custom validators – known as relay clients – working within the other chain’s consensus mechanism. This approach satisfies the trustless element and can handle any data but cannot be generally applied; it requires a custom solution for each cross-chain bridge.
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