TenX Tests Cross-Blockchain Interoperability Protocol For ERC20 Tokens For Bitcoin Using Lightning Network
TenX’s Lab Tested Cross-Blockchain Interoperability Protocol For ERC20 Tokens For Bitcoin Using LN
A research and development Lab related to the blockchain project TenX has tested a cross-blockchain interoperability protocol that uses the Lightning Network (LN). The main intention was to transfer ERC20 tokens for Bitcoin with the LN. The information was released by the lab on December 12 in a blog post.
The interesting thing of this project is the fact that they tested how to swap ERC20 coins with Bitcoin (BTC). This is important because ERC20 are coins that run on top of the Ethereum (ETH) platform but are not native to it.
The Lightning Network is the most important scaling solution that Bitcoin developers are working on now to help the network scale. Back in 2017 when Bitcoin reached its price peak, transactions were taking hours to be processed and the network fees were extremely high. With the LN it is possible to process millions of transactions per second without congesting the main Bitcoin network. At the same time, the fees are extremely low.
The post explains that the ERC20 transfer function works with msg.sender for authentication. Calling a transfer from a contract deployment sets msg.sender to the address of the contract that is going to be deployed.
Additionally, the post talks about the use of the Lightning Network to perform an atomic swap. About it, they wrote:
“An atomic swap cannot always be expressed through this model of invoices and payments. In LND, which is what we used for our PoC, receiving a payment requires an invoice which requires knowledge of the secret. As a result, we were only able to do ERC20 to Lightning and not the other way around.”
They have also explained that they are trying to solve the limited directionality issue. This is why they have not included the results of the Proof of Concept (PoC) for ERC20 tokens.
The Lightning Network has been several times criticized by several individuals, analysts and also experts. Bitcoin Cash (BCH) proponents, for example, are opposed to this idea and preferred to scale the network just by increasing the block sizes in the main chain.