Projects like Metronome and Cosmos are bringing the new generation of distributed ledger technology to life. These cross-platform fusion projects help different blockchains interact freely and create a stronger, interoperable, hyper-productive connected network. It could help in developing a better value transfer system and create smoother token exchange platforms. Lack of regulations in the space, however, delay a promising future for the world.
Accomplishing Connected Networks
The next innovation in blockchain technology isn’t a newly distributed ledger but a network of several connected platforms that work seamlessly.
Lucas Nuzzi, the senior analyst at Digital Asset Research, noted: “We are very close to achieving interoperable blockchains, and this has the potential of changing the entire cryptocurrency market.”
As the technology is still in a nascent stage, most blockchains need extensive development before they are deployed into real economic activity.
Nuzzi believes that connected DLT could help each of these networks create a more efficient platform. There could be an explosion in the number of DLT-based apps. At the same time, the number of tokens on different networks could reduce drastically as coins could travel freely in a foreign framework.
Easy Token Swaps Are Less Than a Month Away
Users could get a seamless token exchange on these interoperable blockchains. The top 10 crypto exchanges in the world are expected to generate $1 billion in fees this year, according to a Bloomberg report. With the advent of connected blockchains, users will not have to use a crypto exchange to convert one coin into another and pay a considerable fee. Instead, they could use a platform like Metronome, which is expected to become available this month.
On this platform, a user can easily move Metronome coins to Ether, Qtum or Rootstock blockchains without having to go to a centralized digital currency exchange or paying a fee.
Another project, Cosmos, helps users in swapping Bitcoins for Ethereum through a network of Cosmos zones and hubs. These specialized decentralized exchanges could work as quickly as a centralized entity. This project is scheduled for a summer launch with limited features.
Regulations and Innovations Don’t Match
Lex Sokolin, global director of fintech strategy at Autonomous Research, believes that a fractured global regulatory environment prevents innovations in blockchain tech. He said:
“Perhaps building interoperability into the protocol at this stage is a useful solution, but until economic activity actually shifts into public crypto, it’s a battle for the merely imagined future.”
The centralized digital currency exchange companies are aware of the force that these connected decentralized networks could harness to hamper their business. Kasper Rasmussen, communications director at Bitfinex, commented that they are already conducting “extensive research into decentralized exchange capabilities” to stay one step ahead in the game.