Cardano: how the blockchain is becoming safer and faster

The Cardano Foundation has been working on a building block that introduces Inter-Blockchain Communication Protocol (IBC) capabilities to the Cardano blockchain, specifically designed to enable reliable transactions and data exchanges across distinct blockchain networks.

In the last few months, Composable Finance launched the first IBC implementation connecting Polkadot, and Kusama, and connections are in development with Avalanche via Landslide, NEAR via Omnity Network, BNB via Toki, Polygon via Union, and now, Ethereum and Solana via Picasso Network.

The IBC framework works not only to enhance existing systems but also to expand what they can achieve. It facilitates the transfer of data and assets between different blockchains while still ensuring enterprises benefit from the security and deterministic fees inherent to Cardano’s blockchain.

For these reasons, The Cryptonomist decided to conduct an interview with Susannah Evans, Product Lead of the IBC at the Interchain Foundation and Sebastian Bode, VP of Engineering at the Cardano Foundation.

Summary

• Can you explain how IBC facilitates interoperability between different blockchain networks and what specific challenges it addresses in the current blockchain ecosystem?
• What are the key technical aspects of IBC that ensure secure and efficient cross-chain communication?
• Could you provide insights on the technical adjustments or developments Cardano has made to integrate with IBC, and what benefits this brings to developers and end-users on Cardano?
• Can you highlight some successful use cases or applications that have leveraged IBC for cross-chain functionality?
• How does Cardano plan to utilize these cross-chain capabilities to expand its ecosystem and support innovative projects?
• What are the upcoming developments or enhancements planned for IBC, and how will they impact the broader blockchain landscape?
• What are the future plans for Cardano in terms of enhancing interoperability with other blockchains, and how does IBC fit into this strategy?
• How does IBC engage with the wider blockchain community to promote and drive adoption of its protocol?
• How is the Cardano Foundation working with IBC and other interoperability solutions to foster a more connected and collaborative blockchain ecosystem?
• Security is paramount in blockchain communication. How does IBC ensure the integrity and security of transactions across different chains?
• How does Cardano’s governance model support the integration of interoperability solutions like IBC, and what measures are in place to manage potential security risks?

Can you explain how IBC facilitates interoperability between different blockchain networks and what specific challenges it addresses in the current blockchain ecosystem?

Susannah: Interoperability is often seen as an application through smart contracts and not directly part of the core blockchain protocols. IBC was designed to allow communication of different blockchain networks for more seamless development of decentralized networks, leveraging this as a core function of the blockchain. For this to work, the protocol must be feasible, credible and accessible. We have seen how other ecosystems struggle with the assumption of trust, those who do not integrate interop as a primary initiative to the blockchain ecosystem. IBC is developed to tackle these core issues – it has been battle-tested to enable both cross-chain and token bridging, trusting the consensus of the chains involved with no verification needed from a third party.

Sebastian: From Cardano’s perspective, how does the integration or collaboration with IBC enhance Cardano’s capabilities and user experience?

Enterprises building on Cardano can now build their own application-specific blockchains. By doing so, they gain more flexibility in terms of privacy and scalability, while being able to rely on the strong security and reliability of the Cardano blockchain. For end-users, they get access to more diverse Dapps while also opening up the DeFi and asset trading space between both ecosystems so that liquidity might flow more easily.

What are the key technical aspects of IBC that ensure secure and efficient cross-chain communication?

Susannah: IBC facilitates secure and permissionless transfer of diverse data across blockchains. The protocol is designed to be consensus agnostic, meaning it can operate across different consensus mechanisms used by various blockchains. This flexibility allows IBC to facilitate communication between diverse blockchain networks without requiring significant changes to their core protocols. Its light client-based approach eliminates the necessity for a trusted third party in cross-chain interactions, safeguarding significant annual value transfers without any exploits since its inception. IBC also employs a relayer model where independent and permissionless relayers are responsible for transferring packets of data between blockchains, meaning data data cannot be altered or tampered with, as their role is purely to facilitate seamless communication.

Could you provide insights on the technical adjustments or developments Cardano has made to integrate with IBC, and what benefits this brings to developers and end-users on Cardano?

Sebastian: Cardano did not have to make any modifications on the core layer as we are solely relying on our smart contract platform Aiken. Other existing developer tools are mostly from the Go and Typescript language ecosystem, as well as Mithril, a product developed by IOHK to bring threshold-based signatures and with these state-proof-like primitives to Cardano. This mostly brings another building block to developers and businesses building on Cardano and gives them a wider solution space for the challenges. It also opens the possibility to add additional EVM compatibility options to Cardano via a sidechain.

Can you highlight some successful use cases or applications that have leveraged IBC for cross-chain functionality?

Susannah: This year, IBC turned 3, making it the oldest and most used interoperability protocol, a significant milestone for our team and a time to reflect on our success over the past 3 years. The recent Cardano integration has expanded our goal of fostering greater interoperability and showcasing the importance of interop across blockchain ecosystems. Beyond Cosmos SDK chains, IBC has seamlessly integrated with the Polkadot, Bitcoin, and Solana ecosystems, expanding networks in line with the goal of optimum interoperability. For example, IBC’s connection with the Solana ecosystem, known for its high-speed and low-cost transaction approach, facilitates the secure transfer of assets across multiple ecosystems and allows developers and users to access a range of features from both ecosystems. These partnerships have expanded IBC’s reach and demonstrated its capabilities to diversify and redefine authentic cross-chain capabilities.

How does Cardano plan to utilize these cross-chain capabilities to expand its ecosystem and support innovative projects?

Sebastian: The Cardano Foundation‘s initiative primarily aims to demonstrate the feasibility of cross-chain interoperability using a widely adopted protocol like IBC. This approach serves two purposes: first, it mitigates the risks that community members would otherwise face when exploring such an approach’s viability. Second, it inspires ecosystem projects to develop Dapps that can leverage Cardano’s robust public infrastructure while simultaneously interacting with the broader interchain network. These Dapps can also benefit from the flexibility offered by application-specific sidechains.

What are the upcoming developments or enhancements planned for IBC, and how will they impact the broader blockchain landscape?

Susannah: There is work in progress for integrations to many other ecosystems, some publicly announced, like IBC’s integration with Toki finance to connect BSC, and some which are yet to be announced. As more blockchains consider IBC as a trusted consensus mechanism for interoperability, more ecosystems will be attracted to expanding with us. We are grateful to the Cardano team for their input and initiative to expand with us and our community. More integrations like these allow our network to mature as various blockchain architectures advance IBC’s offering.

What are the future plans for Cardano in terms of enhancing interoperability with other blockchains, and how does IBC fit into this strategy?

Sebastian: IBC is just one building block of many that are coming to Cardano to enhance its interoperability. There are various other activities going on at the moment and others that have already been completed. For example, there is a community project called UniFires working closely with the Polkadot ecosystem to bring interoperability between Cardano and Polkadot. Additionally, the VISTA group is working on creating a whole interoperability landscape on Cardano to push enterprise adoption to the forefront of activities and existing bridges like WANChain, EVM Sidechains like Milkomeda, and others. Even IOHK is pushing heavily in this direction with the groundbreaking research done around multi-resource consensus and the partnerchains framework.

How does IBC engage with the wider blockchain community to promote and drive adoption of its protocol?

Susannah: IBC is constantly aspiring for new connections and integrations. We have formed a number of strategic partnerships since IBC’s inception, with leading blockchain projects and platforms. With the concept of interoperability at the heart of IBC, it has been developed as an open-source protocol, inviting developers from all over the world to contribute to its improvement and expansion. The open-source approach fosters a collaborative environment where ideas and innovations can be freely exchanged, accelerating the development of robust interoperability solutions. By integrating with major networks, IBC not only showcases its extensive technological capabilities but also leverages multiple blockchain user bases and developer communities from leading industry projects to drive wider blockchain adoption.

How is the Cardano Foundation working with IBC and other interoperability solutions to foster a more connected and collaborative blockchain ecosystem?

Sebastian: Firstly, we are trying to be as transparent as possible, which is why the technical solution has already been made publicly available. On the other hand, we have already received tremendous support from organizations like the Interchain Foundation and projects in the Cosmos ecosystem. Finally, the outstandingly talented developer and SPO community within Cardano are supporting us with their expertise.

Security is paramount in blockchain communication. How does IBC ensure the integrity and security of transactions across different chains?

Susannah: To achieve seamless interoperability, developers and users must be able to leverage the strengths of different blockchains without compromising on security or performance. The security model of IBC is based on trusting the consensus of the chains that want to communicate through the use of light clients. Light clients have a trust on first use security model and use proofs of inclusion and exclusion to verify whether a transaction did or did not take place on the counterparty chain. 

Beyond light clients, the protocol has been formally verified, has been audited by third parties and implements security practices such as defense in depth within the codebase. These features prove the integrity of transactions, reducing the risk of vulnerabilities and ensuring robust security guarantees for other blockchains. Considering these meticulously tested features, IBC achieves a high level of security and efficiency in cross-chain communication, addressing many of the security challenges faced by blockchain ecosystems.

How does Cardano’s governance model support the integration of interoperability solutions like IBC, and what measures are in place to manage potential security risks?

Sebastian: Regarding governance, the impacts of parameter changes need to be evaluated. The correct approach here is to educate users and provide tools that help participants in decentralized governance better understand the consequences of their votes.

As for security, we are currently undergoing a multi-stage auditing process. When it comes to operating a bridge to the wider Cosmos ecosystem, we are partnering with entities that have extensive experience in bridge operations. These partners are capable of appropriate monitoring and, in case of any disaster, implementing mitigation strategies or countermeasures.