• Over $2.5 billion worth of crypto assets were stolen in cross-chain bridge hacks from 2021 to 2022.
• Developers have attempted to improve bridge security, but a Uniswap DAO debate shows that none are secure enough for Uniswap’s purposes.
• As a result, some suggest that only multibridge solutions can secure crypto assets in the cross-chain environment of today.
Bridge Hacking
From 2021 to 2022, over $2.5 billion worth of crypto assets were stolen in cross-chain bridge hacks according to Token Terminal. This has prompted developers to try and improve bridge security with more sophisticated protocols such as Celer, LayerZero and Wormhole.
Uniswap DAO Debate
The issue came to light when the Uniswap DAO began discussing deploying Uniswap v3 to the BNB Chain and had to decide which bridge protocol would be used for its governance. During the ensuing debate it became clear that no single solution was secure enough for Uniswap’s needs, leading some observers to conclude that only multi-bridge solutions could provide adequate security for crypto assets in today’s cross-chain environment.
Current Security Issues
As of Feb 15th 2021, DefiLlama estimates there is currently over $10 billion worth of crypto locked on bridges – making bridge security an urgent issue that needs addressing by developers and blockchain networks alike.
How Bridges Work
Blockchain bridges enable two or more blockchains to share data with each other such as cryptocurrency tokens like USD Coin or Trader Joe (JOE). However, due to each blockchain having its own architecture and database, these coins cannot be sent directly from one network to another – so this is where bridges come into play by allowing users on different networks access their tokens on other networks securely.
Tradeoffs Between Security & Decentralization
When it comes down to upgrading bridges with new features or fixing bugs, developers face tradeoffs between making them upgradeable versus making them decentralized – meaning they must balance between ensuring user safety through improved features against ensuring user control through decentralization protocols like proof-of-stake voting systems or transaction validations via multiple signatories (e.g., multisig wallets).