Blockchains are separate systems. Ethereum cannot read what happens on Solana, and Bitcoin has no built-in way to send coins to BNB Chain. A cross-chain bridge is the software that connects two of these networks so that value or data can pass between them. Bridges are useful, and they have also been the site of some of the largest thefts in crypto. Ethereum.org keeps a beginner-level introduction to bridges.
How a Bridge Works
A token cannot physically leave its home chain. What a bridge does is take control of the token on one side and issue a matching claim on the other. There are three common models.
- Lock and mint: you deposit a token into a bridge contract on the source chain. The bridge mints a wrapped version on the destination chain. To go back, the wrapped token is burned and the original is released.
- Burn and mint: the token is destroyed on the source chain and created on the destination chain. This works when the issuer controls supply on both chains, as with some stablecoins.
- Liquidity pools: the bridge holds reserves of real assets on both chains. You pay in on one side and are paid out from the pool on the other. Nothing is wrapped, but the pool must have enough funds.
In every model, something has to tell the destination chain that the deposit really happened. How that message is verified is the main difference between bridges, and it is where most of the risk sits.
Trust Models
- Trusted or custodial bridges: a company or a small group of signers confirms transfers and controls the locked funds. These are fast and cheap, and you depend on the signers being honest and keeping their keys safe.
- Validator or multisig bridges: an external set of validators signs messages. Security depends on how many signers there are and how independent they are from each other.
- Light client bridges: the destination chain verifies the source chain's block headers directly, so no outside party is trusted. These are harder to build and cost more to run.
- Native rollup bridges: Layer 2 networks have official bridges to Ethereum whose security comes from the rollup's own proof system.
The ethereum.org developer docs describe these bridge designs and trade-offs in more detail.
Layer 2 Bridges
Arbitrum, Optimism, Base and zkSync each have a canonical bridge to Ethereum. Deposits to the Layer 2 usually arrive within minutes. Withdrawals differ by rollup type.
Optimistic rollups assume transactions are valid and allow a period in which anyone can challenge them. That window is about seven days, so a withdrawal through the official bridge takes about a week. The Optimism documentation explains the process. ZK rollups prove validity with cryptography, so withdrawals can settle once a proof is accepted on Ethereum, typically within hours.
Third-party bridges offer faster exits by paying you from a liquidity pool and waiting out the delay themselves, in return for a fee. This adds another set of contracts to trust.
Messaging Protocols
Newer systems such as LayerZero, Axelar, Wormhole and Chainlink CCIP carry arbitrary messages between chains, not only tokens. A contract on one chain can trigger an action on another. Each protocol uses its own verification method, and applications built on them inherit that method's strengths and weaknesses.
Major Bridge Hacks
Bridges hold large pools of locked assets, which makes them attractive targets. Three cases from 2022 show the different ways they fail.
- Ronin, March 2022: attackers gained control of five of the nine validator keys and withdrew more than 600 million dollars. This was a key compromise, not a code bug. US authorities attributed it to the North Korean Lazarus Group.
- Wormhole, February 2022: a flaw in signature verification let an attacker mint about 120,000 wrapped ETH on Solana without depositing anything. The loss was around 320 million dollars, and the project's backer replaced the funds.
- Nomad, August 2022: a faulty upgrade made it possible for anyone to copy a valid withdrawal and change the address. Roughly 190 million dollars was drained by many different wallets.
Risks to Understand
- Key compromise: if the signers behind a bridge are hacked or collude, locked funds can be taken.
- Smart contract bugs: bridge code is complex and spans two chains.
- Wrapped token risk: a wrapped token is only worth something while the assets backing it are still locked. If the bridge is drained, the wrapped token can become worthless on the destination chain.
- Liquidity risk: pool-based bridges can stall or charge high fees when reserves run low.
- Fake bridges: phishing sites copy real bridge interfaces to steal deposits or approvals.
How to Use a Bridge More Safely
- Find the bridge link in the official documentation of the chain or project, not through search ads or social media.
- Send a small test amount first and confirm that it arrives.
- Use the canonical bridge for a Layer 2 when the withdrawal delay is acceptable.
- Check that you will receive the token version that applications on the destination chain accept. Several wrapped versions of the same asset can exist.
- Keep some of the destination chain's native token for gas, or you may be unable to move what you bridged.
Common Mistakes
Sending tokens straight to a bridge contract address instead of using the bridge's deposit function can lose them. Bridging to the wrong network, or to an exchange deposit address that does not support that network, is another frequent error.
Nothing in this article is financial advice.
Track on CoinMarketGuy
Before bridging, compare token values with the converter and check liquidity for the token on its destination chain on the DEX page. The exchanges page lists exchanges that can serve as an alternative route between networks.