Building the interconnected Internet of Blockchains

Since the advent of Bitcoin in 2009 and the explosion of innovation that followed, the web3 industry has faced many challenges. Beyond dealing with regulators, improving UX, and weeding out bad actors, blockchain engineers continue to tackle two major hurdles: scalability and interoperability.

While many Layer 2s are working to scale Layer 1s like Bitcoin and Ethereum by improving throughput and reducing transaction fees, protocols like Union enable both—interoperability at scale.

The need for blockchain interoperability

Whatever your opinion on the WEF, its 2020 whitepaper on blockchain interoperability hit the nail when it stated, “Organisations do not want to find themselves on a blockchain platform that may limit their options for external collaboration in the future.”

To elaborate further on that point, imagine having a Gmail account, sending a message to a Yahoo account, and being unable to exchange communications. The internet was able to develop as quickly as it did because it factored in interoperability from the early days, and blockchains must do the same.

A notable player in the interoperability space is Cosmos, whose flagship Inter-Blockchain Communication (IBC) protocol has enabled a host of sovereign chains to connect, transact, exchange, swap tokens, and perform other actions without compromising sovereignty. Map of Zones shows 91 zones now connected via IBC transacting more than $2.1 billion over the last 30 days in more than 8.7 million transactions.

IBC isn’t limited to Cosmos chains, either. The trustless interoperability protocol has broadened its scope to include EVM-compatible chains such as Ethereum, Polygon, and Avalanche. However, most bridging solutions so far have been offered by centralized providers, meaning users must trust the bridging protocol.

Built and backed by Composable Finance, Consensys, Tokensoft, and Polygon Labs, Union provides a permissionless bridging protocol that connects modular blockchains and rollups trustlessly, without depending on trusted third parties, oracles, multi-signatures, or MPC, using advanced zero-knowledge (ZK) cryptography.

Already connecting several ecosystems, Union recently announced a partnership with L2 developer Polygon Labs that will tap into Polygon’s AggLayer “to facilitate message passing and asset transfers between the Polygon ecosystem and IBC-enabled chains,” bridging two of the largest blockchain ecosystems: Polygon and Cosmos.

Permissionlessly bridging Polygon, Cosmos, and beyond

Union founder and prior CTO at Composable Finance Karel Kubat told Crypto, “It’s not just a Cosmos to Polygon bridge but anything that’s IBC-enabled, which includes Scroll, and soon Arbitrum, Berrachain, Movement Labs, M2… They can build and connect into the Agglayer using Union,” permissionlessly tapping into the liquidity of one of the largest blockchain Layer 1s, Ethereum.

“Right now it’s very interesting because we have big L1 ecosystems that really only have permissioned centralized bridges or something in between. You need to go to the bridge provider to get support for a small ecosystem. What Union does, is if you’re building a new Cosmos chain or a new rollup that’s IBC enabled, you don’t need to go to a centralized provider to get support. You just open the connection to Ethereum and you’re done… So we’re going quite quickly from a world with only 200 to 300 ecosystems to a world with thousands and thousands.”

This type of seamless interoperability isn’t possible with centralized solutions because the “wait queue” is too long. Every chain wanting to connect needs to request the bridging protocol’s permission.

With Union, chains can permissionlessly open a channel with Ethereum, enabling a seamlessly interconnected future… of potentially millions of chains. Karel gives the example of dYdX, one of the largest decentralized exchanges that began as a smart contract on Ethereum and moved ecosystems to become a sovereign Cosmos app chain.

“We all went into crypto for sovereignty,” he says. “Any successful smart contract is contemplating going to their own L2 or app chain.” This means the total addressable market for Union is potentially vast. “It isn’t anyone that wants to build a blockchain. It’s any existing app on Ethereum and Solana that could benefit from making this move.”

Union’s IBC to Polygon bridge should be completed by the end of this year and you can keep up with the latest developments by following Union on X.