Is Cross-chain Dead? Only Two Directions Left for the Future of Multi-chain

In the future development of the crypto world, there are only two paths: providing security through Ethereum Rollups, or independent development of multiple chains.

This article is authorized to be reprinted from BlockBeats. The original article can be found here.

This article outlines the views of crypto researcher pseudotheos on personal social media platforms, and the translation is organized by BlockBeats as follows:

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From a technical perspective, cross-chain has reached a deadlock. In the future development of the crypto world, there are only two paths: providing security through Ethereum Rollups, or independent development of multiple chains.

It has been proven that storing huge wealth in a single cross-chain bridge contract is not a reliable solution. Not only does it introduce single point of failure, but it also introduces significant contagion risk vectors to the target chain.

With Poly Network hacked for $611 million, Wormhole for $326 million, Ronin for $624 million, and many more similar cases in just a few months, all these theft incidents have one thing in common – issues with cross-chain bridges.

If you are not familiar with how cross-chain bridges work, here is a brief explanation:

Users lock their assets in a contract on the source chain, and the cross-chain contract mints an equivalent asset certificate on the target chain after confirming the asset. (BlockBeats notes, detailed explanation in "When you are crossing chains, are assets really transferred?")

On the target chain, users are actually trading with this IOU certificate, while the real assets are still stored in the smart contract on the source chain, which is the root cause of the contagion risk.

If there is an exploit in the source contract, the IOU assets on the target chain lose endorsement and thus lose all value. At this point, all protocols using this IOU asset on the target chain will be affected, such as incorrect asset pricing, liquidation, etc.

Therefore, the idea of "cross-chain" is likely a dead end. In my opinion, anyone claiming that there is still hope for its revival is likely to have a vested interest.

Under these circumstances, the crypto industry is now left with only two development directions:

1. A Future Centered on Rollups

In a Rollup-centric environment, a protocol only needs to deploy assets once on the underlying L1 chain to achieve "natural" interoperability with other Rollups on that L1 chain.

Even off-chain Rollups allow assets to exit to L1, rather than being trapped on the target chain like cross-chains. Native Rollups also eliminate bridging risks from L1 to L2.

Furthermore, the unique DA flexibility of Rollups allows them to store data on-chain or off-chain as needed, catering to niche application chains and meeting the significant scalability needs of the execution layer. Most importantly, Rollups greatly reduce security budgets.

2. A Multi-Chain Future

In a multi-chain future without interoperability, protocols would need to deploy native assets on each chain separately, leading to different security assumptions for each chain.

In addition, chains would need centralized exchanges to assist in asset transfers or require cooperation to create new trading mechanisms.

In the history of technological development, technologies with convenience, composability, and low cost have always prevailed.

Even in a future where multi-chains are dominated by EVM (fast, low-cost), public chains with independent consensus mechanisms are unlikely to capture a significant market share from Ethereum focused on Rollups.

I anticipate that other public chains will develop their unique advantages, but over time, most chains (especially EVM chains) are likely to migrate to become an Ethereum Rollup.