Polkadot (DOT) and Bancor (BNT) team up for a joint project

Written by: Ali Raza
February 4, 2021
  • Bancor and Polkadot recently revealed a partnership that will result in a new product.
  • The two plan to create a cross-chain liquidity bridge between them.
  • The bridge comes with a number of advantages, such as interoperability, trustless swaps, and more.

According to the recent announcement, Bancor (BNT) is teaming up with Polkadot (DOT) in order to work together on creating a cross-chain liquidity bridge. The bridge would allow interoperability between the two projects, and it will bring a number of new possibilities for their users, as well.

Bancor and Polkadot are developing a liquidity bridge

The cross-chain bridge would bring plenty of advantages. For example, it would be possible for users to provide liquidity, create pools, carry out trustless swaps between Polkadot and Bancor-based ERC-20 assets, and more.

Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.

The move was announced on February 1st, in a blog post that explains the initiative and why it is important for the projects. The team also revealed that the bridge is being developed by a startup known as LiquidApps.

LiquidApps has its own goals, one of which is to make it easier to develop new decentralized applications. To make that possible, the company is offering a wide range of innovative products and tools.

Advantages of using Lightweight nodes

One important detail about the upcoming cross-chain bridge is that it will reportedly use lightweight nodes to listen to transactions. This will also allow it to interact with Polkadot and Bancor chains.

Bancor explained that existing bridges can have their nodes cost thousands of millions of dollars to run. Lightweight nodes, on the other hand, can run in a simple browser, drastically slashing the costs of running them, as well as the time needed to set them up.

Not only that, but the software that the nodes are based on, WebAssembly (WASM) is a low-level bytecode that was designed to also run on the internet.

In essence, there are a lot of reasons for how and why this bridge could be beneficial to everyone involved, and pretty much no negative sides of developing it, which is why the collaborators are moving to create it as quickly as possible.