Blockchain’s stature is growing exponentially. Blockchain is expected to generate $11.7 billion in business spending by 2022. One of the main reasons for this increase is data integrity, security and reliability. As more businesses and people start to grow aware of blockchain’s transformative potential, it is undoubtedly said to reach new milestones.
Web 3.0 firms have been spearheading innovations in the crypto space and are germinating Blockchain into the very heart of organizations’ business processes and are adding significant value in enterprise solutions. Many DLT applications and ecosystems have been created to address the specific needs of different industries. They offer solutions for a variety of uses.
However, widespread adoption of blockchain has yet to occur.
Part of this slow adoption can be attributed to the technology’s inherent traits: that it occurs very gradually until 8-10% before exploding in usage. The main reason for this slow adoption of blockchains and other dApps is that they lack the ability to communicate, transfer data, and interact with others chains. This is known as ‘interoperability’.
A Tipping Point to Mass Adoption: Interoperability
The current state of blockchains is that they can function as self-contained systems. Every chain has its own code set and can not be accessed by other blockchains.
Practically, this means that the features and benefits of blockchain ‘A’ are available to users who ‘lock in’ to chain A’s ecosystem. Access to users’ data, such as assets, filings and value, would be impossible on any other chain.
Not only could this lead to centralization of access in one blockchain, but it also may deprive users of some of the potential benefits offered by another blockchain.
Interoperability is important because it allows for the exchange of data. Interoperability allows two blockchains to communicate and exchange information.
Multifarious requirements are required by enterprises in order to be able to transact in any transaction. This requires multiple networks that can work in conjunction with one another. According to the World Bank’s and IMF’s reports, blockchain interoperability is essential for business operations as well digitalization.
Decentralized finance is where liquidity pools can be optimally utilized. Cross-chain protocols such as Konstellation aim to connect funds across multiple chains.
Inter-Blockchain Communication will enable chains and applications on-chain to work together securely, without the need of one-to-one integration or expensive fees. Interoperability lets you leverage the best from all of them by expanding your horizons to allow blockchain to reach its full potential.
To a Collaborative and Interconnected Future
To bridge the gap between blockchains, there are increasing numbers of interoperability efforts such as Polkadot (and Cosmos). The goal is to allow networks to connect more easily and to ensure that decentralization can be fully realized.
IBC can enable the direct use of assets locked in one network in another without impairing each others’ economic prospects in industries like DeFi.
Konstellation, in this vein has entered the DeFi Ring with a clear purpose: To allow cross-chain liquidity for the capital market segment.
It aims to improve DeFi market composability, increase accessibility of crypto assets, and facilitate the transfer of assets across chains. The platform will bring together fragmented parts of the blockchain market, including NFTs and cryptocurrency liquidity.
✨KONSTELLATION is a Blockchain Protocol.Built upon Cosmos Network SDK.