Wednesday, January 26, 2022
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By Parasshuram Shalgar
Published 40 mins ago Updated 40 mins ago

The “basic security limitations of bridges,” according to Ethereum’s co-founder, are the primary reason for his dislike. On Friday, a Reddit post by Vitalik Buterin, the co-founder of Ethereum (ETH), underlined major security problems around cross-chain bridges in the blockchain ecosystem, which he believes are being overlooked. 

Because native assets (such as Ethereum on Ethereum and Solana on Solana) are stored directly on the blockchain, according to Buterin, they are more resistant to 51 percent attacks. However, even if hackers are successful in censoring or reversing transactions, they cannot propose blockages that would allow someone to lose their cryptocurrency.

The regulation also applies to the Ethereum application, a smart contract. Consider this scenario: hackers launch a 51 percent attack (by controlling 51 percent of all circulating Ethereum supply) while an investor swaps 100 ETH for 320,000 DAI stablecoin, the end state remains invariant, which means the investor will always receive either 100 ETH or 320,000 DAI, depending on the circumstances.

Statement From Buterin on Cross-Chain Bridges 

Buterin went on to say that cross-chain bridges do not have the same level of security as the rest of the network. If, as an example, an attacker used their own Ethereum (ETH) to deposit into an Ethereum (ETH) bridge to obtain Solana-wrapped Ether (WETH), and then reverted that transaction on the Ethereum side as soon as the Solana side confirmed it, it would cause catastrophic losses to other users whose tokens are locked in the SOL-WETH contract, because the wrapped tokens are no longer backed by the original on a 1:1 ratio.

Yet another point brought up by Buterin is that the security attack could harm scaling if more bridges are added to the cross-chain network. When considering a hypothetical network of 100 chains, the high level of interdependence and overlapping derivatives imply that a 51 percent attack on one chain, particularly a small-cap one, may induce a system-wide epidemic. In the opinion of Crypto 51, it can cost up to $1.78 million an hour for hackers to launch a 51 percent attack vector against the Ethereum network. For blockchains such as Bitcoin Cash, on the other hand, the cost can be as low as $13,846 per hour.

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The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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