DeFi Users ‘Don’t Care’ What Chain Apps Are On: Composable Finance

“Polkadot and Cosmos share a similar vision where you have a range of heterogeneous blockchains working together,” Jafar Azam told Blockworks


Brian A Jackson/Shutterstock modified by Blockworks


Composable Finance is bringing inter-blockchain communication (IBC) from the Cosmos to Polkadot.

IBC, as its name indicates, is an interoperability protocol that helps blockchains communicate with each other in the Cosmos ecosystem. 

The protocol is designed with a transportation layer and an application layer; these layers work together so information between different blockchains can be accurately and securely transferred. 

Although it is native to the Cosmos ecosystem, IBC can connect to app chains outside of its network. Composable Finance sees this as an opportunity to bring this technology to Polkadot and other ecosystems.

For this reason, the company has chosen to use IBC to connect DeFi functions across different ecosystems, Jafar Azam, head of developer relations at Composable Finance, told Blockworks. 

“We believe in a future where users go to an application, and they don’t care what chains the application sits on, as long as they’re getting the best and most efficient rate that they want,” Azam said.

While Polkadot does have a counterpart to the IBC called the Cross-Consensus Message Format (XCM), Azam points out that its functionality is restricted to bridging between parachains.

“We looked at how IBC was working, and it had been in communication transfers over the past few years since launch, and due to its trustless nature, we chose it as the transfer layer to bridge to other ecosystems,” he said.

According to Azam, the IBC has already facilitated the connection between Polkadot and Kusama, which serves as Polkadot’s canary network — a testing ground of sorts for features and functions. There are also plans to establish a connection between Polkadot and Cosmos later this month.

Choosings IBC over other bridging solutions ultimately came down to its decentralized, trustless nature, Azam explains. Noting that a lot of bridge communication protocols rely on multi-sigs, where funds can be withdrawn if multisig holders choose to collude. 

“You’re looking at an entire ecosystem being demolished just via four people…because IBC does not rely on any third party, it’s not a centralized solution,” Azam said. “That’s why we chose IBC.”

Composable Finance is also one of the first teams to implement CosmWasm, a protocol facilitating the creation of modular smart contract code. Composable Finance implemented it outside of the Cosmos ecosystem, enabling existing projects on Cosmos to deploy on Polkadot.

“Polkadot and Cosmos share a similar vision where you have a range of heterogeneous blockchains working together, our goal is bridging between these two ecosystems because everybody has the same vision of a cross-chain future,” he said.

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