Blockchain and cryptocurrency may be extremely popular with millions of users, but they are still a long way from mass adoption. Meant to disrupt centralized currencies and systems, blockchain offers the benefits of faster transactions, lower transaction costs, and enhanced speed and security. As of July 2022, there were more than 83 million blockchain wallet users, reports Blockchain.com; those numbers underscore the massive popularity of cryptocurrencies and the blockchain technology they are built on.
At the moment, there are at least 1,000 blockchains with at least four types of blockchain networks and around 20,000 active cryptocurrencies that rely on blockchain infrastructure. With new blockchain networks being launched each year in specific industries to tackle certain niches’ needs, interoperability will be crucial for mass adoption. Blockchain may be a disruptive technology, but there is no perfect solution that can meet all blockchain technology needs at once.
This means that there will be a growing need for interoperability and interconnection between different blockchain networks. Interoperability allows different blockchains to communicate and share data and digital assets; it also makes collaboration much more efficient. Since every blockchain is developed using its own code bases and standards, there is little connection between different networks. As it stands, most blockchains do not have interoperability and are not compatible, meaning all transactions in a given blockchain can only occur within that blockchain.
THORWallet DEX founder and CEO Marcel Harmann compares interoperability to free data exchange, stating that base layer protocols currently cannot communicate with each other effectively. He explained that layer-1 protocols such as Cosmos and Ethereum have inbuilt smart contracts that only allow secure data exchange to occur within their own networks. Exchange with other ecosystems is virtually unheard of because most blockchains don’t have interoperability.
If blockchain is to achieve mass adoption over the next decade, it will have to prioritize interoperability between different ecosystems. Linking users in different blockchains together via a single protocol would provide users with access to different decentralized applications (DApps) without the need to switch networks. Interoperability would also allow users to take advantage of the benefits offered by each blockchain network, something they currently cannot do because most networks operate independently.
Interoperability would also allow for the development of products that are “interoperable across chains,” said Quadrata cofounder and CEO Fabrice Cheng, giving users, institutions and businesses the ability to stay more interconnected. It would also eliminate intermediaries for blockchain users and could promote growth and opportunity in the crypto sector by giving traders more ways to use their digital assets.
The development of protocols that enable blockchain interoperability would certainly give all industry players, including BlockQuarry Corp. (OTC: BLQC), a boost since it would be possible to access a wider base of potential clients in different industries.
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