On August 2, token bridge Nomad became another victim of a cross-chain attack after the protocol suffered a breach that resulted in the theft of $190 million. Joining the list of victims along with Axie Infinity’s Ronin Bridge and Solana’s Wormhole protocol, many industry insiders have cast doubt on the future of cross-chain technologies. However, not all cross-chain toolkits have been exploited so far. In this regard, Cointelegraph has spoken with the Osmosis co-founder Sunny Aggarwal. Osmosis is one of the most popular decentralized exchanges, or DEXs, on the Cosmos hub with $120 million in total value locked. Here is what Aggarwal had to say about the Cosmos Inter-Blockchain Communications (IBC) protocol:
“The major bridge hacks are a reminder to victims that bridges are, in fact, too fragile to be allowed to hold significant amounts of capital at this stage of their life cycle. High-profile bridge hacks throw up shed light on IBC as the most viable solution for cross-chain bridging, as this understanding acts as an opportunity for the rest of the EVM-based ecosystems to look at IBC as a serious alternative for doing cross-chain communication.”
Today, there are almost fifty blockchains using IBC to perform more than 10 million transactions daily, in an ecosystem with more than a billion dollars in assets under management, despite the market downturn. “The totally reliable nature of the system is what makes [el IBC] works so well” Aggarwal said.
The DeFi architect pointed to a recent example that illustrates the resilience of the IBC: “A major test for the Osmosis DEX came when Terra Luna crashed. Most of our namesake OSMO tokens that were locked resided in the LUNA/OSMO and UST/OSMO pools. To prevent a malicious actor from minting infinite LUNA and draining OSMO staking pools, the Osmosis governance implemented a trading halt on IBC’s Osmosis-Terra channels.”
According to Aggarwal, IBC’s ability to distribute points of failure through cross-chain sovereignty is precisely what keeps it “the most secure bridge protocol out there.” To date, more than $2 billion worth of funds have been stolen in cross-chain protocols, accounting for 69% of all stolen cryptocurrencies in that period.
Clarification: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information set forth herein should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.
Investments in crypto assets are not regulated. They may not be suitable for retail investors and the full amount invested may be lost. The services or products offered are not aimed at or accessible to investors in Spain.