- Prime Protocol becomes the first-ever prime brokerage in the DeFi space making bridgeless cross-chain token transfer possible.
- It will eliminate the need for cross-chain bridges for safer transactions.
Defi prime brokerage platform Prime Protocol launches an all-new protocol that will enable users to make bridgeless cross-chain token transfers. This eliminates the requirement for third-party token bridges to carry out transfers from one blockchain to another. It is important to note that third-party token bridges are often prone to attacks, so a bridgeless cross-chain transaction will be much safer.
Cross-chain bridges and bridgeless transfer
With the increasing functionality of blockchains, users are engaging on multiple blockchains. Hence there arises a need to transfer assets and perform transactions from one blockchain to another. This is enabled using cross-chain bridges that function as channels to communicate between two blockchains.
There is an increasing demand for blockchain bridges because of their interoperability. Users can transfer and manage their crypto assets across multiple blockchains using these bridges. They can transfer tokens, real estate tokens, NFTs, smart contract details, and other data and information across blockchains. This interoperability between blockchains provides better opportunities to use tokens for a wide variety of DeFi activities and increases traffic on dApps.
Notably, cross-chain bridges are highly vulnerable to malicious hacks. The security of these protocols is not very high due to their on-chain movements. A significant portion of DeFi thefts involves stolen funds. Besides, using third-party protocols to transfer tokens is quite cumbersome and may be counterproductive due to the mechanism and length of time taken. According to Chainalysis’ research, 69% of all funds stolen on DeFi occurred on cross-chain bridges only due to malicious parties making full exploitation of the protocol vulnerability. A bridgeless transfer, therefore, seems more secure, efficient, and sensible with the whole concept of decentralized exchange as it would eliminate the involvement of a third party to execute transfers.
Bridgeless transfer with Prime Protocol
Prime Protocol, the first of its kind protocol, is intended to facilitate prime brokerage services in the DeFi space. It is an asset-based lending protocol that has emerged as the first-ever prime brokerage to facilitate cross-chain transfers without the involvement of third-party token bridges. The elimination of a bridging channel will ensure greater safety while transferring funds.
Led by the motto, “Deposit anywhere, borrow anywhere,” the manner of Prime Protocol is now live. It supports asset portfolios across the blockchains of Moonbeam, Ethereum, Arbitrum, and Avalanche. It allows users to move the entire value of all their crypto assets against the various tokens available on these blockchains and aims to expand shortly to include more blockchains.
The testnet began operating in September 2022, and the protocol has more than 51,000 unique users. For inter-chain communication, the protocol uses blockchain developer Axelar’s generic message-passing technology. Axelar network is widely recognized as one of the leading cross-chain communication platforms.
Remarkably, at the release of Prime Protocol, Derek Yoo, CEO of PureStake, a development team for Moonbeam commented “This is a significant security enhancement for the entire DeFi industry because it eliminates manual bridging as a point of vulnerability that is often exploited,”. Other stakeholders of DeFi have also applauded the protocol’s permeability of on-chain liquidity, regardless of where the collateral is stored.
Along with enhancing the security of cross-chain transfers by making them bridgeless, Prime Protocol also offers other basic cross-chain capabilities. This innovative tech has not only changed the game of how cross-chain communication works but also has paved the way for a seamless cross-chain infrastructure by breaking down the barriers between blockchains.