Tag: bridging

Bridging crypto between Layer 2 blockchains – not currently supported?

The Problem: Bridge protocols don’t enable users to bridge between Layer 2s

Crypto holders should be able to use their tokens whenever they want, across any set of blockchain networks.

Ethereum gets you security, but it is a very expensive layer. The benefit of Layer 2 networks is that they are more scalable – fees are lower in L2.

Unfortunately, users cannot move funds directly between Layer 2 networks.

Interoperability for tokens among different chains in web3 is a critical technical problem with crypto bridges today.

Bridging between Layer 2 networks is impossible

For example, users can’t go directly from from Optimism to Arbitrum, no matter what bridge they use.

In order to move tokens between these layer 2 networks, users are forced to take a multi-step process, bridging back to Layer 1 from Optimism before moving their funds to Arbitrum.

You can try it to see for yourself.

As shown below, after adding both Arbitrum Network AND Optimism Network to my wallet and going to the Arbitrum Bridge, its clear that the only connection possible is to go between Layer 1 and Layer 2.

arbitrum bridge only enables funds to go from L1 to L2
Aribitrum bridge only recognizes assets available on Layer 1, even though funds are in Optimism on the same connected wallet.

Layer 2 direct jumps don’t exist (yet).

Current Functionality: Bridging from Ethereum to Layer 2 is simple

Bridging from Ethereum Mainnet any one of the Layer 2’s is pretty simple and straightforward.

For example, a user’s first experience exploring the Optimism ecosystem (covered in this post) is pretty straightforward:

The Ethereum –> Optimism bridge allows for funds to be transferred quickly, letting the user get started with dapps like NFTs, DeFi, and more.

Similarly, bridging from Ethereum Mainnet to Arbitrum is pretty easy.

Users use a service like Chainlist to connect to any number of different Layer 2 blockchain networks directly, without manually typing in the network ID and other information.

How to use the Chainlist website, where you can connect to EVM powered Layer 2 networks.
Connect directly to EVM powered networks using Chainlist, without having to manually enter network details into your wallet

Optimism and Arbitrum are just two examples – Chainlist offers hundreds of connectable networks – an overwhelmingly large amount of software to explore.

Improving crypto bridges will reduce fees for users

The fact that a user can’t move funds between two different rollups without sending funds back to Ethereum Mainnet not only makes the user experience more cumbersome, but it means users pay higher fees.

The bridging process requires two additional transactions on Ethereum Mainnet, instead of a single transaction on Layer 2 between networks.

This multi-step process ultimately requires more gas.

At this point, the ability to move funds between layer 2 networks is an aspect of UX that is missing, and is a big gap in crypto.

The ideal UX features simply have not been built out yet.

Poor user experience is the nature of emerging technology

When you are exploring the frontier of emerging technology, some difficulty of use should be expected.

To put things into perspective, this lack of user functionality is part of what makes crypto most exciting.

If the UX was perfect and every blockchain app was easy to use, then crypto would already be mainstream.

When you are using emerging technology before other people, it is going to be clunky and difficult to use.

We are early; blockchain technology still has so much un-realized value. This is part of exploring and seeing tech trends before everyone else.

We Need to Enable Users to Migrate Between Layer 2 Blockchains

The good news, is that interoperability problem currently exists within similarly EVM compatible blockchains.

Because Layer 2 networks share protocols with Ethereum’s foundational Layer 1, the challenge should be solvable.

The Ethereum ecosystem, with the EVM protocol fundamentals, was made for this type of universal compatibility… shared components allowing protocols to integrate.

Axelar Network seeks to solve interoperability

We know its possible. Still, bridging between Layer 2’s is a feature that is not yet present in web3.

One network focused on this is the Axelar Network.

On the recent Zero Knowledge podcast episode, Sergey Gorbunov discussed how to make layer 2 protocols more interoperable.

Sergey shared information about how Axelar is focused on interoperability, making it easy for users to migrate between chains.

He mentioned that by building service layer protocols on top of the core networks, end to end flows between applications will be easy and seamless for users.

This will also enable bridging between Ethereum L2s so that users don’t have to go back to the main chain.

How to Bridge, Swap and Wrap Crypto on Ethereum and Polygon Networks

Overview of Bridging, Swapping, and Wrapping tokens on Ethereum Mainnet and Polygon Mainnet

After familiarizing myself with transacting in ETH using the Metamask wallet, I wanted to try a few things on Polygon.

Unfortunately, I made few mistakes and almost lost $375 worth of Ethereum.

Not a life-changing amount of money, but still would have been a bummer to lose funds.

Thankfully, I was able to locate all of the funds after doing my due diligence to understand how the Ethereum-to-Polygon network transactions work.

I’ll share what I learned – but first, the TLDR:

TLDR: Wrapping and Swapping happen between tokens on the same blockchain network. Bridging means you are switching your funds from one blockchain to another.

etherescan transactions
my transactions in question, via etherscan

Swapping ETH to MATIC

When you want to transfer ETH into other tokens, you use a process called “swapping”. During Swapping, your funds stay on Ethereum Mainnet but they are transferred to a different token.

Uniswap is a popular tool that allows you to transfer ETH to another token on the Ethereum Mainnet Network.

When you want to swap a token from ETH to something like Polygon / Matic, you’re going to end up with the MATIC token on the Ethereum Mainnet network after paying your gas fees.

Initially, however, the token might not show up in your wallet (this is what happened to me). I thought I lost my tokens because I simply didn’t see them there, and mistakenly thought my funds were lost completely.

In order to fix this, you have to click “Import Tokens” in your wallet. Search for MATIC, and select the one that says “Matic Network Token (MATIC)”.

import tokens on matic

You should then see the value of the Matic that you swapped displaying in your wallet.

Wrapping ETH to WETH:

OpenSea gives users the two options:

  1. Bridge Ethereum to Polygon
  2. Wrap Ethereum to WETH
ethereum and polygon options to bridge or wrap on opensea

Bridging processes are fundamentally different – more on that in the next section.

Wrapping means you are converting ETH to WETH on the Ethereum Mainnet network. You are not switching blockchains.

When you select “Wrap” and input the amounts, you will end up with WETH on Ethereum Mainnet. It should auto-display in your wallet without you having to do anything. Pretty easy.

Bridging ETH to Polygon

Bridging ETH to Polygon means you are moving funds from one blockchain network to another (off of Ethereum Mainnet and onto Polygon Mainnet).

This is fundamentally different than Wrapping and Swapping because you are literally changing blockchains.

When you bridge, you also end up swapping or wrapping tokens on the back end. ETH does not exist on the Polygon Mainnet blockchain – only WETH (wrapped Ethereum).

What does exist on Polygon Mainnet is WETH. When you select “Bridge to Polygon”, you end up with WETH bridged to Polygon Mainnet.

When you Bridge, because your funds are moved off of the Ethereum Mainnet blockchain, they might not show up in your wallet.

This is where I mistakenly thought I lost my funds the second time!

To fix this, you need to add the Polygon Mainnet network to your wallet.

Using a tool like Chainlist makes it easier. Go to the website, connect wallet, search for Polygon Mainnet, and click “Add To Metamask”.

Once its added, switching between Ethereum Mainnet and Polygon Mainnet is possible.

ethereum mainnet and polygon mainnet

When you click Polygon Mainnet, you should see your bridged funds displaying in WETH – in my case 0.055 worth, below.

Once you bridge to another blockchain, you can swap and wrap different tokens on Polygon Mainnet just like you can on Ethereum Mainnet. Uniswap enables this on the Polygon blockchain too.

On OpenSea, you can transact with WETH on Polygon, but not with MATIC.

Just don’t forget to check your wallet and make sure you’re on the right network!

matic and weth balance on polygon mainnet
Notice that the balance of MATIC on Polygon is 0 – its all in WETH.

What do to if WETH is not showing up on your wallet:

If you switch the the Polygon Network after depositing WETH into your Polygon wallet, sometimes the tokens are hidden, and won’t initially show up.

This can also happen if you disconnect your Metamask wallet from your browser and then re-connect.

But Don’t worry! Your funds are still there, they’re just hidden.

To fix this, simply click Assets, then click “Import Token”, and paste the WETH token address into the “Token Contract Address”.

import WETH token on Polygon Mainnet

Don’t forget to double check and verify that you are using the correct token contract address. Refer to Polygonscan if in doubt, or the official Polygon Docs. We’re going to be using WETH-POS.

When you paste the Token Contract Address in, it should auto-populate the Token Symbol (WETH) as well as Token Decimal, 18.

Click Add Custom Token, and it should work!

Moment of Zen:

Crypto is risky. Blockchain is the wild wild west of the internet – there’s not really anywhere to go for help if you make a mistake.

The beauty of owning your private keys means that you have control over your funds.

The downside is that if you end up losing those funds, there’s really no one to blame but yourself. If I lost my funds, it would have been my own fault, and there’s not a bank to help recover anything.

In hind-sight, the funds were never really at risk of being gone forever, I simply didn’t know how bridging and swapping worked.

I should have educated myself because a lot of blockchain processes are counter-intuitive.

Crypto finance is different than the traditional banking that we’re all used to.

There are prerequisites and important steps to be taken to ensure the protocols line up and that the transactions go through smoothly.

Lesson learned: next time I try something new or experimental in crypto, I’m going to watch a few videos, read the documentation, and educate myself BEFOREHAND.

Making mistakes is part of the crypto learning experience. Fuidance of friends from time to time has certainly helped, but there will always be some trial and error while experimenting in the world of crypto.