Interoperability: What You Need to Know
There are lots of things to discuss once you’ve entered the crypto space. New terminology is everywhere because this technology and the things we can do with this technology are still fairly new to us. It’s no surprise that there are certain areas in which people have concluded need a lot more work. You may have heard a lot about security or user experience, for example. Another area that projects are looking to improve is something called interoperability. What exactly is interoperability, why does it matter, and who’s trying to solve the problem?
Interoperability is the ability for systems to communicate with each other. Let’s break that down using the example of the healthcare system. When you go to see a doctor, several things have to happen. First, you make the appointment, then you have your visit, then you may need a follow up or you may need to visit the pharmacy. Each one of those steps requires nurses, doctors, or pharmacy techs to input data into a system. Each of those systems are different. The pharmacy may have a program that is nothing like the program that the doctor’s office has. Therefore, there must be a way for the programs to communicate with each other. When a nurse or a doctor types notes into a system or if they use that system to write a prescription, the pharmacy’s program needs to be able to access that information. In this way, the doctor’s office and the pharmacy are interoperable. They are able to share data seamlessly between their individual programs. The crypto space is no different. Since there are now tons of different blockchains, crypto projects have had to figure out a way to design systems that can communicate with all the different types of blockchains. That’s because some of these projects will be offering a service that might need to pull data from multiple blockchains.
It’s important to have projects that are interoperable because it means there are more opportunities for their services to better serve the crypto community. Let’s use the same example from above, healthcare. Imagine someday that each of the services you go through (i.e. call to schedule an appointment, visit the doctor, go to the pharmacy…etc.) can be done using blockchain technology. If each of those steps uses a different blockchain, you want all of them to be able to communicate seamlessly so that you can make your appointment, see a doctor, and get your meds without a technical fuss delaying any part of the process. The same can be said for other projects in the crypto space. Many of them are built primarily on one blockchain but may need to accept payments from tons of other blockchains, for example.
There are currently lots of projects in the crypto space that have set out to solve the problem of interoperability between blockchains. This list includes projects like Polkadot, Chainlink, and Wave, among many more. Another project that has become interoperable out of necessity is a project called Cobalt Lend. They began just wanting to create a platform where users could lend and borrow on the blockchain. Since they wanted this platform to be community driven, they had to build out ways for users to govern and when they did that, they realized they themselves would be using multiple blockchains. So, in the case of Cobalt Lend, they use Ethereum for the money side of business (i.e. staking and lending), they use the Binance Smart Chain for governing tools like voting, and then they use the NULS network for storing specific information and other things. In addition to those chains, they now have the capability of communicating with all other chains through their API bridges.
Interoperability is key for the crypto space. Going forward, many chains will need to and want to be interoperable so that business can run smoothly and people can enjoy a seamless experience. It’s not like the crypto space to let a middleman in, so it’s fitting that lots of these projects have set out to solve the problem themselves. Now that you know what interoperability is and why it’s important to the community, be looking for ways that this type of integration can help make our lives easier.
