We have seen the power and possibilities inherent in blockchain technology through use cases that support cross-border payments, reduce voter fraud, increase the efficiency of supply chain management, and reduce healthcare costs. The advancements made possible by blockchain are enormous, and leveraging the benefits of multiple blockchain platforms via interoperability can create an even greater impact.
In this episode of The Ripple Drop, we sit down with Mayukha Vadari, Software Engineer at RippleX, to discuss the role of interoperability in blockchain technology, how interoperability is approached, and how the XRP Ledger (XRPL) can support the multi-chain future through innovations like sidechains.
The state of interoperability today
Blockchain interoperability refers to a variety of techniques that help blockchains communicate through a seamless transfer of data, enabling improved collaboration and efficient transfer of digital assets.
“The goal of interoperability is, how do we have it all? How can we use our value in all these different ways without having to have these siled ecosystems?” says Mayukha.
Many blockchain projects are currently working on interoperability, and Mayukha explains that there are several approaches to facilitate interactions between blockchains. One approach is “layer 0” projects, which are essentially an underlying blockchain designed to act as a connector for other layers.
Cross-chain bridges – protocols that enable communication from one blockchain to another – are used as another approach to interoperability. Bridges such as Allbridge, Multichain and Apex have integrated with blockchains such as XRPL, Ethereum, Avalanche and others to facilitate the transfer of value across chains.
Yet another approach is through sidechains – a parallel network that derives its value by interpreting data from and exchanging assets between the mainchain and the sidechain. Ripple proposed a sidechain strategy for the XRPL community in 2021 that would enable developers to more easily implement new features, such as native smart contracts that interact seamlessly with XRP and the XRP Ledger.
Benefits of interoperability in blockchain
When interoperability is successful, disconnected markets and business applications can more easily transfer data and value, driving innovation and productivity. Mayukha explains that when you leverage interoperability, “you get the best aspects of any project”.
In addition, interoperability helps to further fulfill the promise of decentralization maintained by various blockchains. Instead of one blockchain processing all transactions, many application-specific blockchains can process transactions while communicating with each other simultaneously.
XRPL interoperability through sidechains
RippleX is hard at work on a production release of sidechains that would run parallel to the XRPL network if adopted by the XRP community. This functionality will allow developers to implement new features on versions of XRPL designed to fit specific technical needs – such as for smart contracts – while maintaining the lean and efficient feature set and fraction of a penny fees that make XRPL so appealing.
Mayukha is excited about the hands-on experience of building the sidechain feature and the opportunities this can bring to the XRPL developer community.
“[Developers] can write their own sidechains that have the special features they need or want and basically have their own blockchain to play with. They don’t have to worry about having to create a bridge somehow because it’s already built into what we do.”
RippleX is also working on Ethereum Virtual Machine (EVM) compatible sidechains – a feature that will allow users to use Solidity smart contracts with XRPL and lower the barriers to entry for developers looking to build powerful DeFi apps with cross-chain interoperability
The possibilities are extensive: a sidechain can be strictly permissioned or (almost) permissionless, public or private. A sidechain can even operate without transaction fees or reserve requirements, or can add new transaction types and functionality for storing large chunks of data on the ledger.
Want to hear more? Watch the latest episode of The Ripple Drop for more details.
