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How do cross-chain transaction networks work?

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cross-chain transactions

Blockchain technology was initially thought to be an all-in-one solution, where all the transactions would take place on a single chain. However, this idea was deemed impractical with time due to certain limitations and constraints arising within the system scalability area.

If blockchains are to live up to the expectations, then the blockchain technology should allow atomic transactions over various blockchains that are interconnected. A single blockchain may even be split into multiple chains that cooperate.

The concept of cross chains is understood as the ability of two operating blockchains to exchange information with each other in order to form a network to process transactions. Cross-chain transaction networks allow multiple blockchains to pass over information to one another.

The use of blockchain platforms like Bitcoin, Ethereum, and Ripple has highlighted scalability issues over time. These limitations in the present blockchain technology have hindered its full potentials and benefits. Exactly where cross-chain technology comes in to resolve such scalability constraints faced by blockchain technology.

Cross blockchain compatibility

The cross-blockchain compatibility issue arises whenever we talk about multiple blockchains. Incompatibility is because not all of the blockchains use similar protocols. Each blockchain system communicates according to its standards.

The lack of a standardized protocol of intercommunication between the blockchain networks cripples the blockchain technology’s scalability, here comes in cross-blockchain compatibility. The concept allows blockchains to communicate without any need of intermediaries. In this way, blockchains can perform transactions over a cross-chain network.

The cross-platform compatibility will allow businesses to communicate with their clients or exchange information over different blockchains, given that the blockchains are compatible.

Utilizing open protocols on the cross-chain allows the development of standardized connections, enabling multiple blockchains to interconnect easily. Various cases are available that allow the exchange of cryptocurrencies without the use of any centralized intermediaries. This way, the system will perform as a decentralized cross-chain. The cross-chain allows a mutual connection to be established between varying blockchains like those of Bitcoin and Ethereum.

Multi-chain frameworks

Multi-chain frameworks are the next evolutionary step in the cross-chain arena that operates as open environments. More complex than open protocols, multi-chain frameworks establish open communication allowing users to transfer data and values between varying blockchains. The framework allows different blockchains to plug into the environment and be part of a standardized system that operates as a network.

The application of cross-chain technology is imperative for the appropriate adoption of blockchain technology. The use of these networks will also widen the scope of cryptocurrencies. 

Similar to the concept of the Internet of Things (IoT), these frameworks are referred to as the Internet of Blockchains (IoB) due to their rather unique capabilities of enhancing blockchain interoperability.

A more efficient system

The concept of blockchain interoperability looks towards enhancing the efficiency of the system and removing any overhead costs. Using smart contracts will allow the system to operate without the need for any intermediaries. 

The blockchain interoperability solutions will provide enhanced protection and lower transaction costs.

Image by Tumisu from Pixabay

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Elon Musk Advises Crypto Users To Secure Their Crypto Keys Properly

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The crypto community has not gotten over the fact that the world’s richest man has now invested in Bitcoin and has been pretty active in the industry.

However, the community is now receiving security tips for storing cryptocurrencies from Tesla’s chief executive officer. While pointing the security of cryptocurrencies, Tesla also criticized Freewallet app, a crypto wallet for its slack in security.

He also added that crypto investors should not bother doing business with wallets that don’t provide them with private keys.

Users should store their private keys

The unique way cryptocurrencies are stored makes them not redeemable when the keys are lost. Whether the holder stores them with third-party custodians or exchanges, the owner can only claim them when they provide keys to the crypto funds.

That makes securing the keys the most important thing when dealing with cryptocurrencies. As a result, selecting the safest hot or cold wallet is a priority if users want to keep their crypto investments safe.

Elon Musk has come out to advise investors to always store their private keys personally. For a company to receive the attention of the world’s richest man is something to take advantage of to grow. However, FreewalletApp’s short conversation with Musk is a sort of negative publicity to them.

After the company engaged with Musk about a Dogecoin-related post, the Tesla founder pointed out faults with the firm.
He advised digital asset investors to stay…

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Bitcoin Surges After Tesla Bought $1.5 Billion Worth of BTC

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Cryptocurrency

The sudden rise of Bitcoin has been connected to the decision taken by the Tesla electric car company to buy $1.5 billion worth of Bitcoin.

The company explained in a filing with the Securities and Exchange Commission (SEC) that it bought Bitcoin to diversify its cash returns and more flexibility.

Musk’s Tweets also impacted Dogecoin’s price

Tesla also added that it will start accepting Bitcoin payments for all its products, although this will be based on a limited basis and applicable laws. If the company concludes and starts accepting cryptocurrency, it will make it the first major car manufacturer to accept Bitcoin payments. The company’s founder and Chief Executive Officer Elon Musk has developed an interest in Bitcoin and cryptocurrencies.

He has been tweeting severally about the viability of the Dogecoin (DOGE), which doesn’t have an important market value attached to it.

Few hours after endorsing Dogecoin, the cryptocurrency rose by an impressive 50%. But regulatory authorities are still concerned about the risks in cryptocurrency investments, with several regulatory bodies warning traders and investors they could lose all their money from crypto investments.

But for Tesla, the company decides to diversify its funds and increased its cash returns. However, Tesla also warned investors about the volatility of Bitcoin’s price in its SEC filing. According to the SEC…

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Partnership Between Bridge Mutual & AllianceBlock Announced

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Decentralized peer-to-peer discretionary digital asset coverage platform Bridge Mutual has announced a partnership with AllianceBlock. AllianceBlock is a decentralized, blockchain-agnostic layer 2 protocol bridging decentralized finance with traditional finance. The partnership will allow AllianceBlock and Bridge Mutual to provide traditional investors with a protected bridge to DeFi through decentralized coverage. 

“Discretionary coverage is a very important part of our ecosystem, so we are excited to partner with Bridge Mutual and leverage each other’s technologies,” says Rachid Ajaja, CEO of AllianceBlock. “We look forward to building an ecosystem where all participants have access to the best products while mitigating the ever-present risk of smart contract failure, hacks, and the resultant loss of collateral value.”

In 2020, as much as $200 million worth of digital assets was lost in attacks on major digital asset services. Bridge Mutual’s platform gives users the option to purchase and provide discretionary coverage, reducing investors’ risk of losing funds because of theft, exchange hacks, stablecoin price crashes, exploited contracts, and other vulnerabilities in digital assets. 

By using Alliance Block’s multi-pair liquidity mining platform, Bridge Mutual will be able to offer BMI token holders instant liquidity through staking and high APY rewards for a variety of pairs. Once integrated into AllianceBlock’s P2P lending platform, Bridge mutual will be able to provide coverage to investors. Additionally, Bridge Mutual is working towards…

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