In a press release shared with CryptoSlate, the Foundation said that the bridge will also enable Algorand’s integration with other blockchain networks and provide a significant influx of liquidity to the growing network.
Algorand’s liquidity challenges are about to be solved
Despite its low latency, high scalability, and low cost of transactions, Algorand has been struggling with attracting liquidity. With the majority of DeFi and NFT projects now in the Ethereum ecosystem, its’s users have been struggling with a lack of network effect.
To address this, the Algorand Foundation, a non-profit tasked with supporting the network’s development, has awarded a grant to develop a bridging solution that would connect the blockchain to Ethereum.
Applied Blockchain, a London-based software development company, has received the grant and will use the funding to bring the scaling solution, called the London Bridge, to market. The company is also working on several applications based on Algorand, making it a natural choice to further develop London Bridge.
The company will work hand-in-hand with Algorand Inc. in making London Bridge a safe, low-cost, and easy-to-use interoperability solution.
In the long term, the strategy is to have all verification of the other chains to be performed within Algorand’s smart contracts, the Foundation told CryptoSlate. To achieve this, Algorand Inc. will incorporate state proofs in the form of Compact Certificates into the Algoran Consensus. By working together, Applied Blockchain and Algorand Inc. will enable London Bridge to validate both block headers and the state of other blockchains trustlessly, in their respective smart contract environments.
Daniel Yang of the Algorand Foundation told CryptoSlate that the partnership with Applied Blockchain will allow them to solidify a DeFi infrastructure on Algorand, which will gradually turn it into an ecosystem where decentralized finance can thrive. Introducing cross-chain efficiency to the network will provide it with a permanent transfer of TVL from Ethereum and add its low cost and transaction speed to other networks.
Adi Ben-Ari, the founder and CEO of Applied Blockchain, told CryptoSlate that the company looks forward to developing the most optimal bridging solution.
“We’ve seen the demand for a secure token bridging solution through the many applications that we’re building for our clients on Algorand. Liquidity and composability are key benefits of blockchain, and a secure and seamless bridge will increase these for all applications on Algorand,” he said.
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