Chainlink has introduced the Cross-Chain Interoperability Protocol (CCIP), a technology designed to link applications across both public and private blockchain networks in the “early access” phase.
Chainlink explains, “This will provide a unified interface for seamless interaction.” Notably, CCIP has been implemented on the Synthetix decentralized finance protocol on the mainnet to support cross-chain transfers between Ethereum, Optimism, and other blockchains.
Unlike typical cross-chain bridges that use wrapping mechanisms, Chainlink’s CCIP leverages smart contract support groups on different blockchains. This approach allows for more seamless interaction between different blockchain networks.
Additionally, CCIP includes the Activity Risk Management (ARM) Network. The ARM Network provides an additional layer of security by continuously monitoring and validating the behavior of the CCIP network, independently checking cross-chain operations for potential issues.
According to the Chainlink team, the CCIP system can benefit cross-chain lending applications, enabling users to collateralize assets on one blockchain and borrow assets on another. It can also support cross-chain data storage, liquidity pooling, and gaming applications across multiple chains.
The Chainlink team stated in a press release: “Just as Web2 needed TCP/IP to connect isolated computer network groups, web3 needs a standard for interoperability to connect blockchain network groups.”
Use cases for CCIP could extend beyond decentralized applications and expand into traditional finance. Swift, the global interbank messaging network, and more than a dozen financial organizations have explored CCIP to guide token transfers across public and private chains through the existing Swift messaging infrastructure.