The segregation within crypto caused by blockchain
tribalism has made it difficult to interact with multiple blockchains
at the same time in the rapidly evolving world of blockchain technology.
Interoperability has become a key issue of different blockchain.
Networks struggle to communicate with each other.
This has led to a great deal of so-called blockchain tribalism, and this has seen
users segregate into different fractions behind different L1 blockchains,
as well as the formation of independent ecosystems operating on each chain
with a huge amount of redundancy and also copycat ing.
This, unfortunately, has also made it more difficult for end users
to interact with the most useful decentralized applications and protocols
since they would need to manage independent wallets for each chain
they wish to interact with.
Enter layer 1 blockchains such as Polkadot and Cosmos.
These offer a solution to this problem by enabling Cross-chain communication
and also interoperable, helping to produce a more cohesive blockchain ecosystem.
What is a layer 0 blockchain?
While layer 0’s are blockchains that aim to facilitate
the seamless exchange of data and or value between otherwise independent
blockchains, potentially including layer one and two, layer two platforms.
Right now,
most blockchains are siloed off from one another into each maintains its own
ledger, its own set of smart contracts and in many cases, its own user base.
Due to blockchain tribalism,
this leads to a major duplication of efforts, with many DApp developers
opting to deploy their smart contracts on multiple different blockchains,
potentially dividing their community and introducing UI hurdles.
It also leads to the rapid
growth of clones and also copycats, which take the formulas and products
that already succeeded on one chain before deploying them on a separate chain.
And this has led to somewhat
predatory strategies with layer ones competing for popular decentralized
applications or DApps and putting up sizable ecosystem funds
to help drawing talent while striking up exclusivity deals with prominent DApps.
Layer 0’s changed the paradigm by helping developers favor cooperation
over the competition, by ensuring
that the applications and products they develop on one chain can communicate
and interoperate with assets and users that exist on other chains.
The way they accomplish this can vary considerably between platforms ranging
from full blown interoperability protocols like polkadot substrate framework to
more modular solutions like cosmos inter blockchain communication or IBC protocol.
By creating a network of connected blockchains.
Layer 0's aim to break down the walls between different blockchain networks
and promote a more collaborative and interoperable ecosystem.
This could potentially unlock new opportunities for innovation
and also development,
as well as a greater efficiency and scalability in the blockchain industry.
It can also help to power novel use cases that take advantage
of the unique properties of multiple different blockchains.
As the blockchain space continues to evolve and also mature,
Layer 0's will likely play a crucial role in enabling the seamless
exchange of data and also value between different blockchains works.
So how do you Layer 0's work?
While the Layer 0
landscape is now incredibly diverse, with well over a dozen platforms
now vying to become the thread that closes the gaps between blockchains,
these are all interconnected different blockchains together
to form a more cohesive and also interoperable ecosystem
where Cross-chain communication is simple and efficient.
But the way they attempt to accomplish this varies from platform to platform.
That said, there are some common underlying techniques, principles,
protocols and also technologies that most of the platforms use.
And some of these include atomic swaps.
So Layer 0 blockchains use atomic swaps to move assets
from one chain to another without the need for a trusted intermediary.
Atomic swaps enable
use cases like cross-chain liquidity pools and also interchange asset trading.
And then there's also cross-chain data oracles.
So these allow blockchains to securely access and leverage
reliable off chain data and allow independent layer ones and layer two
to access information from a variety of different chains.
Moreover, platforms like Chainlink offer interoperability protocols
like the Cross-chain Interoperability Protocol or CCIP to help blockchains
receive and exchange data from Oracle nodes in a standardized way.
And then there is arbitrary message passing.
So practically all layer zeros feature a way to pass arbitrary messages
between chains allowing for seamless data
exchange between any and all chains in the l0 space.
Some examples of arbitrary message passing technologies and protocols
include polkadot's, cross consensus message format or XCM, Wanchain’s
Cross-chain communication protocol
and also Cosmos SDK is inter blockchain communication protocol.
And then there is also shared consensus.
So by offering a single underlying consensus mechanism for all associated
chains, Layer 0’s can massively improve efficiency
and maximize the utilization of available resources.
This can also lead to improved security by supporting a larger and more diverse
validator network,
which some independent chains would only be able to achieve with help.
And then there's also bridges.
So the vast majority of interoperability platforms leverage bridges,
which use a combination of smart contracts and APIs to facilitate communication
between two or more chains and can be implemented in a variety of ways,
including through centralized or decentralized mechanisms.
Assets or data moved between chains can then be used
with an expanded range of platforms and also protocols.
Then there's also shared security.
So many Layer 0 blockchains
offer a shared security resource
to connected chains, allowing them to bootstrap their node or miner network
and remain secure even if they are relatively small or inactive.
And Polkadot's relay chain is a prominent example.
By leasing a parachain slot, parachains can benefit from
the Central security offered by validators operating on the relay chain.