Allbridge to become the first token bridge for the Stacks token
Multi-chain token bridge Allbridge will become the first to offer Stacks (STX) transfers as part of a partnership with Bitcoin software developer Daemon Technologies.
STX is the native token for the Stacks Layer-1 blockchain which settles transactions on the Bitcoin (BTC) network. It currently has a market cap of $1.7 billion. Allbridge currently serves 12 blockchains including Ethereum, various Ethereum-compatible sidechains, Solana, Terra, and others.
A token bridge allows crypto from one blockchain to be transferred to another one. The new bridge will allow transfers between Stacks and all chains served by Allbridge.
The Stacks Bridge will go live in Q2 2022. It will initially only support transfers of STX, but is planned to support transfers of other Stacks protocol SIP010 tokens such as ALEX and the USDA stablecoin. There are also plans to enable NFT transfers between chains.
In a Feb. 10 announcement, Allbridge co-founder Andriy Velykyv expressed how the partnership will help serve the crypto community’s need for access to the Bitcoin ecosystem.
“Creating a bridge that allows for people to interact with Bitcoin-powered applications will help streamline processes that were previously only limited to a single chain and ecosystem.”
Daemon Technologies is providing a $140,000 grant to Allbridge to help facilitate growth of the bridge. Daemon Technologies founder Xan Ditkoff told Cointelegraph that partnering with Allbridge to create the Stacks Bridge will “allow users to come and use the assets within the network for whatever the use case is.”
Ditkoff illustrated what he sees as the beneficial interplay between Stacks’ utilization of the Bitcoin network’s security for transaction settlement and separate blockchains for higher throughput. He said: “It’s good for people who want to transact on faster networks, then bring their assets onto Bitcoin for security.”
The security of token bridges has been in the spotlight this month. In the past 2 weeks, there have been three hacks of token bridge smart contracts. On Feb. 3, $321 million in wETH was minted through the exploit of a bug on Wormhole’s smart contracts on Solana, which created an inorganic surplus of tokens on the blockchain.
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Ditkoff brushed off security concerns related to the Allbridge token bridge. He said, “We have a lot of confidence in the Allbridge team.”
“It’s easy for people to forget that these bridges are so new. How long have people been coding with Solana’s VM? Everything is still at the bleeding edge.”
Ethereum creator Vitalik Buterin made an eerily well-timed warning to the crypto community by writing in an early January Reddit post that there are “fundamental security limits of bridges.”
Ditkoff refuted Vitalik’s statement in saying, “I have a hard time seeing a future when bridges are not a huge part of the ecosystem,” and continued:
“The logic behind Vitalik’s words would be that everything settles on one chain that is optimized for the one thing that (Proof-of-Work) is made for: byzantine fault tolerance. Bitcoin doing that better than anything in human history will have an impact on whether one chain eventually dominates.”