Syscoin-Ethereum Bridge Simplified

By humblebumble | Syscoin Season | 6 Sep 2020


In this article I’ll be giving a very quick overview of the bridge between Ethereum and Syscoin, without too much of the technical stuff, and some of the benefits it brings.

What It Does

The Syscoin bridge allows anyone to transfer their ERC-20s and Syscoin Protocol Tokens (SPT) between the Syscoin and Ethereum blockchains trustlessly. As long as the tokens exist on both blockchains they can cross the bridge. More of your favorite tokens aren’t just created out of thin air though. If, for example, someone sends 10 BUSD across the bridge from Ethereum to Syscoin these tokens are first “freeze-burned” or locked within the bridge smart contract thereby taking them out of the circulating supply on Ethereum. The same amount of BUSD tokens are then minted on the Syscoin blockchain. When crossing the bridge from Syscoin to Ethereum the opposite happens; the BUSD tokens on Syscoin are burned and upon this being confirmed the tokens locked in the bridge smart contract are then unlocked and sent to the specified Ethereum address. What this means is that the number of tokens in circulation remains the same when moving between the chains; if 10 tokens move to Syscoin, that means there are 10 less on Ethereum and the opposite is true going the other way.

Why It’s Big

Crossing the bridge takes time. From Syscoin to Ethereum it takes around 3 hours, crossing the other way takes around 1 hour. With this in mind the bridge was really designed not for users themselves to utilise but larger organisations like exchanges with lots of tokens to transfer. These organisations can then provide a service to users that allows them to instantly swap their tokens between Syscoin and Ethereum for a small fee. This combined with the 60,000 transactions per second (tps) speeds of SPTs using Z-DAG, tested and confirmed by Whiteblock who are at the forefront of blockchain testing, makes a compelling argument for organisations and companies supporting interoperability between the two chains. And let’s not forget that Ethereum transactions are often extremely expensive now due to the astronomic rise in popularity of DeFi, whereas Syscoin transactions cost fractions of a cent.

Why does the instant swap service matter?

  • For traders:
    • Consider when at least two exchanges decide to implement this service. With Ethereum’s transaction speeds only being around 12tps the arbitrage opportunities (and profits to be made) on ERC-20s will shoot up due to the far cheaper and x5000 times faster transactions using SPTs.
  • For general crypto users:
    • Imagine your favorite wallets integrating this service. You could send, receive and store your ERC-20 tokens as SPTs to utilise the blazing fast speeds and low costs then instantly convert your tokens into ERC-20s whenever you need to use any smart contract functionality. The best of both worlds.
  • For regular people:
    • Looking slightly further into the future, Syscoin is making itself the best home for stablecoins and an instant swap service (enabled by the bridge) will facilitate this with allowing them to be easily transferred between Ethereum (where many currently reside) and Syscoin. When the day comes that point of sale payments made with cryptocurrencies starts to become widespread, which blockchain do you think will be used? It’s more than likely going to be one that is scalable, cheap, secure and supports all of the popular stablecoins. More on this in another article.

Hopefully this makes the Syscoin bridge and some of the future prospects of it clearer to envision. There are undoubtedly many more big things coming to Syscoin in the near future so keep your eyes peeled. The developers often speak in the Syscoin Discord so you might get more hints on the future developments from there: Join Syscoin Discord

Do you think your favorite ERC-20 project could benefit from using the Syscoin bridge?

If so, get in contact with the developers of the project and send them the link below. There is currently a bounty running where developers who bridge their token to Syscoin can receive up to 35,000 SYSX (Syscoin as an ERC-20). Not too shabby for such a small amount of work!

Syscoin Bridge Bounty

Prefer to tweet instead? Here's the official tweet from Syscoin about the bounty that you can reply to and tag the developers of your ERC-20 project:

Want a more in-depth description of the bridge?

Check it out here.

How do you rate this article?


4

0


Syscoin Season
Syscoin Season

Syscoin broken into little, easily digestible pieces.

Send a $0.01 microtip in crypto to the author, and earn yourself as you read!

20% to author / 80% to me.
We pay the tips from our rewards pool.