A blockchain bridge is a protocol designed to serve as a channel for transferring assets or data between two blockchains, be they separate mainchains or sidechains. Since blockchain infrastructures differ, bridges must take into account differences, such as token standards and consensus mechanisms, to ensure seamless interoperability between the two chains.
A bridge transfers funds by locking the original asset amount on the native blockchain, while representations are issued on the bridged blockchain. Assets may not always be transferred. Instead, liquidity pools may be used to enable the movement of funds.
As one of the most important factors in decentralized finance, bridges facilitate the communication of apps across different networks, while often providing users with liquidity access. That said, because they join inherently different blockchain structures, bridge vulnerabilities are common. Users should always assess the potential for such exploits before transferring funds via a bridge.
