Bridge

A blockchain bridge is a system or software designed to facilitate the transfer of assets across various networks. They enable interoperability by connecting different blockchain ecosystems, such as two Layer 1 blockchains (e.g., Ethereum and Bitcoin), two Layer 2 networks (e.g., Arbitrum and Optimism), or a Layer 1 blockchain and a Layer 2 network (e.g., Ethereum and Linea), allowing for seamless asset movement and interaction across disparate networks.

There are multiple types of bridges, depending on how asset transfers are handled, including lock-and-mint, liquidity, optimistic and multisig bridges:

• Lock-and-Mint: Locks tokens on the source network and mints an equivalent amount on the destination network.
• Liquidity: Creates a liquidity pool that spans both the source and destination chains, into which users deposit their tokens and then withdraw an equivalent value.
• Optimistic: Follows the liquidity model with the additional assumption that all bridge transactions are valid by default.
• Multisig: Uses multi-signature (multisig) wallets, requiring a predetermined number of wallet approvals for bridge execution.

To facilitate easier bridge development, a new concept called Bridge-as-a-Service (BaaS) has been introduced. BaaS provides a framework and tools for projects and businesses to build, host, and manage their own native bridge functions without the need to develop or maintain the underlying infrastructure themselves.