With a cryptobridge, it is possible to send currency between different blockchains.
There are many different blockchains. For example, there is the Bitcoin chain, the Ethereum chain and the Binance chain. To move funds from one blockchain to another, there are several options. One option is to exchange one coin for another through an exchange or broker. This is actually a workaround. This is because the credits are not literally transferred but exchanged by a third party.
The purpose of a bridge is to create a bridge between different blockchains. For example, a bridge makes it possible to exchange bitcoin from the bitcoin blockchain to wrapped bitcoin on the Ethereum network. Through a smart-contract, the amount in bitcoin is fixed on the bitcoin blockchain. An amount is then released on the Ethereum blockchain in wrapped bitcoin.
Blockchains have different applications. New blockchains often offer more capabilities than older blockchains. These capabilities often have to do with decentralized finance and web3. When the bitcoin network was built in 2008, web3 did not yet exist. So the bitcoin blockchain can really only be used to exchange bitcoins between different addresses. On the Ethereum network, it is also possible to take out loans via smart-contracts, for example. With a bridge, it is also possible to use bitcoin to participate in DeFI applications on the Ethereum network.
Bridging blockchains is a complicated event. Many operations take place before funds from one network are available on another. First, the amount must be secured on the blockchain. Then an amount is released on another blockchain. It is possible that there is an error in the smart contract. As a result, the bitcoin is not properly secured on the bitcoin network, for example. In addition, there may also be an error in the creation of Wrapped Bitcoin (WBTC). Thus, it may be possible for an attacker to create Wrapped Bitcoin. Several "hacks" are performed by exploiting small flaws in bridge code. For example, in October 2022, $570 million was stolen from the Binance Smart Chain. In March of the same year, $600 million was stolen from a bridge of the game "Axie Infinity.
