The merger is almost here. How will it affect Blockchain Bridges?

Transverse chain bridges: What are they?

Before we begin, it is important to discuss what transverse chain bridges are. A blockchain bridge is a platform that enables the transfer of assets between different networks. For example, you can use it to transfer USDT from BNB Chain to Ethereum.

In this particular example, the BNB Chain is what we refer to as the EVM (Ethereum Virtual Machine) compatible blockchain. However, there are also what we call non-EVM-compliant chains, which have distinct architectures and are notoriously more difficult to integrate with. Examples of these networks are Solana and NEAR Protocol, just to name a few.

The merger and its implications for EVM chains

The upcoming Merge event – ​​the merging of the existing execution layer of Ethereum with the new Proof-of-Stake consensus layer, the Beacon Chain, will have a significant impact on the current landscape of cross-chain bridges.

Once the merger is completed, we will initially see a tendency for some users to transfer their assets back to Ethereum from other EVM chains. However, the majority of users will still wait until the network is stress tested first to avoid potential loss of assets. There is a chance that some critical issues will be discovered after the transition to the Proof-of-Stake consensus model.

But over time, and if Ethereum survives the stress testing, there will be a decline in the existing EVM network user base.

Ethereum 2.0 in the long run

If we consider the long term, if Ethereum becomes as scalable as promised after the third phase of the merger, this will have a significant impact on the scaling protocols, especially Arbitrum and Optimism. And with waning interest in other EVM chains, we will see volumes drop drastically, favoring transfers to Ethereum, where most of the user base will remain.

Although this would initially lead to an increase in the number of transactions and bridge volume, the interest would be short-lived, as the other networks could potentially become redundant after Ethereum’s full migration.

The merger: Interoperability across chains afterwards

With Ethereum taking market share away from other EVM chains, I think this is where the bridges between Ethereum and other non-EVM chains will start to play a bigger role. There is a potential interest in cross-chain transfers between Ethereum and other non-EVM chains such as Solana. The existing blockchain bridges will have to adapt to supporting non-EVM protocols in the post-Merge world.

Our upcoming bridge solution Allbridge Core envisioned the potential changes Ethereum Merge has in the DeFi ecosystem. By providing a native stablecoin bridging experience, we will enable seamless cross-chain exchanges between Ethereum, BNB Chain, Tron and Solana.

We anticipate that the bridging solution, covering EVM and non-EVM directions, will remain a necessary tool for users even after the merger is complete.

About the author

Andriy Velykyy is co-founder and CEO of Allbridge. He is also an experienced crypto entrepreneur. Andriy is a former Cisco Certified Network Professional who has worked in IT since 2002, primarily in data center architecture and networking. Andriy entered the crypto industry in 2015, building mining farms before moving on to technological breakthroughs such as crypto payment integration with Point-of-Sale devices, cybersecurity and non-custodial multi-chain crypto wallets. In 2021, he co-founded Allbridge, a blockchain bridge that allows tokens and/or arbitrary data to be transferred between EVM and non-EVM compatible blockchains.

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