The Optimal Combination of Security, Decentralization, Transfer Speed, Preservation of Custody, Cost Efficiency, and Customization.
The SKALE Network introduced its SKALE IMA Bridge earlier today and in the process showed that security, transfer speed, preservation of custody, cost efficiency, and customization do not have to be at odds. The SKALE IMA Bridge achieves all these attributes by making use of BLS cryptography, Ethereum mainnet smart contracts, Proof of Stake consensus, and other unique aspects of its design. This bridge lets developers and users safely and economically transfer digital assets between the Ethereum mainnet and any SKALE Chain. These digital assets can include ETH, ERC20, ERC721, and ERC1155 tokens as well as general messaging data.
The SKALE Network is a highly expandable multichain blockchain network that serves as a secure Ethereum scalability solution. Unlike most Layer 1 and Layer 2 networks, the SKALE architecture is built to support an ever-expanding set of dapp-specific chains. It uses the Ethereum mainnet to manage and orchestrate many critical network operations thereby enhancing overall network security and transparency.
About Network Bridges in General
Network bridges are essential components between connected blockchain solutions as they allow for the secure transfer of digital assets between networks. These bridges serve as transfer agents for the assets. Instead of transferring the actual assets, however, they serve as a combination of lockboxes and proxy providers to provide verified transfer of digital equivalents.
On a basic level, a bridge lets a user send an arbitrary message from one chain to another chain in such a way as to allow the contents of that message to become functional in that second chain without risk of double spend or separate concurrent activity on both chains. This message passing implies a locking or unlocking of the contents of the messages (i.e. the tokens) in one chain and the provisioning of a synthetic asset on the other chain.
There are a number of approaches to network bridges. Many of these suffer deficiencies in some form or other which impact adoption and user experience. These deficiencies include:
- Overly long transfer exits – hours, days, or even a week.
- Inflexibility – many only support ERC20 tokens, others require filling out a form and waiting for the dev team to approve your desired token type
- Custody risks – On some L2s, the custody of tokens minted on that network do not remain with the owner after exiting to the L1 (the bridge owner mints the NFT in its name)
We can also add complexity, potentially faulty security mechanisms, and lack of customization to complete the picture of immature bridging technologies.
How the SKALE IMA Bridge Works
The SKALE IMA Bridge changes this and, best of all, it works in a simple, transparent, and highly secure manner. Token holders signal their intention to transfer tokens and other digital assets from Ethereum to a SKALE Chain (or from the SKALE Chain to Ethereum). When sufficient validators for that SKALE Chain see this transfer signal on chain and validate it as well-intentioned and true, the transfer initiates on the Ethereum mainnet (or SKALE Network if in reverse). The assets are secured and placed into a deposit box on the Ethereum mainnet via SKALE contracts on the mainnet. After a set number of blocks (10) have passed on the Ethereum mainnet (so as to ensure transactions are fully recognized and valid), a transfer request gets sent to a proxy called the SKALE IMA Agent which in turns calls the SKALE TokenManager operating within the SKALE node network to process this transfer within the respective SKALE Chain. As opposed to days or even hours, this transfer happens quickly, buffered only by mainnet block creation.
A transfer in the other direction, going from a SKALE Chain to Ethereum, happens in a similar manner, although in the case of exiting SKALE into the Ethereum mainnet, the tokens are burned on the SKALE chain and unlocked on the mainnet. In the case of tokens that are minted on the SKALE Chain and then transferred to Ethereum – a minting operation on Ethereum takes place as part of the transfer in such a way as to preserve the ownership of the minted token.
Benefits of the SKALE IMA Bridge
Security should be the foremost consideration when evaluating network bridges. The SKALE IMA Bridge makes use of the combination of SKALE’s operational ties to the Ethereum network, its Proof of Stake consensus model, and its foundation in BLS Cryptography to provide a secure and fault tolerant approach to asset transfer between Ethereum mainnet and SKALE Chains. The DepositBox contract runs on the Ethereum mainnet as does the contract that handles assets returning to the mainnet.
Transfer speed is another important consideration in transferring assets between networks. Long delays in confirmation of transfers negates many of the advantages of choosing a scaling solution much less using blockchain technology. Plasma-like bridges may have exit periods that might last up to 1-2 weeks (giving other parties the opportunity to contest an exit). The SKALE IMA Bridge works quickly and efficiently via its PoS model and use of BLS threshold signatures – the only gating factor being a requirement for more than 10 block cycles on the mainnet to ensure transaction validity. This efficiency means that transfers can happen in minutes (and potentially less with the advancement of Eth2 and beyond).
Decentralization is often one of the first attributes to be sacrificed in the pursuit of speed. This is not the case with the SKALE IMA Bridge, however. The SKALE Network uses a Proof of Stake model that draws validator node sets via random selection from a large validator pool and rotates them frequently so as to further enhance security protections against malicious behavior. Its ABBA consensus model in combination with BLS cryptography means that a sufficient number of nodes must validate transfers as being true while still allowing for a certain amount of node or network outages. This algorithmic approach provides for a highly decentralized validation scheme that is both fault tolerant and secure.
The Proof of Stake nature of the SKALE Network and its economic model (chains are sponsored by dapps, protocols, DAOs, and other entities) means that SKALE chain transactions have little to no costs associated with them. The only costs incurred are from Mainnet operations but these have been optimized by the SKALE team to be as economical as possible (equivalent to a Uniswap transaction in many cases). Mainnet are unavoidable when bridging to and from Ethereum. In the case of SKALE, they are as minimal as can be.
Preservation of Custody
The SKALE IMA Bridge preserves custody of tokens that are minted on a SKALE Chain when they exit to the Ethereum mainnet, a claim that many bridges cannot make. This capability is a must-have for NFT-based dapps, along with any other dapp that might mint a token, in that a primary reason for using a scalability solution is to avoid high-cost minting operations on the Ethereum mainnet. Using a network bridge that does not preserve custody introduces tremendous counter-party risk to any and all exits from that network. The SKALE IMA Bridge preserves custody and eliminates this risk.
The SKALE IMA Bridge offers full support of ETH, ERC20, ERC721, and ERC1155 token standards and has built-in functionality to support custom tokens. This support is on a chain-by-chain basis. Chain owners can decide what tokens to accept – by standard or by token issuer, for example – in the event that chain owners want to confine token transfers to specific types so as to simplify asset management or provide protective measures against inadvertent transfers. The SKALE IMA Bridge contract also has hooks so that chain owners can specify new token types or other forms of digital assets that they want to support.
We are proud of our work on the SKALE IMA Bridge and believe it will be the model used for Ethereum-based bridges going forward. It has its security firmly rooted in the Ethereum mainnet and a rigorous algorithm approach. Its Proof of Stake model and BLS cryptographic underpinnings share many similarities to the design decisions in Eth2. Added to this is the multichain nature of the SKALE Network allowing for customizable and dapp-specfic token acceptance policies and you get a flexible and largely infallible asset transfer mechanism. One that is fast, cost efficient, and simple to use and simple to understand.
The SKALE IMA Bridge is not a bridge to the future though, it’s a bridge to now.