How to get to Solana
Blockchains can be thought of as virtual islands or isolated ecosystems, initially limited in their ability to communicate directly with each other. This design choice has historically limited users' ability to freely transfer assets across different blockchain platforms.
Blockchain bridges have emerged as a solution to overcome these limitations and facilitate the seamless movement of funds across the chain. This enables cross-chain compatibility, simplifying the process of transferring digital assets between different chains and allowing users to conveniently move their money without being tied to a single blockchain.
The use of bridges is not limited to transferring property between chains. It can involve complex executions such as using resources or functions from multiple blockchains in decentralized applications (DApps) simultaneously.
How the bridge to Solana works
A user can use a bridge to transfer a digital asset through the blockchain. For example, if a user wants to transfer Binance USD (BUSD) from BNB Chain to Solana or vice versa, the bridge facilitates it. Although there are many methods to complete the transfer, according to the bridge, the process usually involves a lock-and-mint system.
This refers to locking assets on the source chain and creating an equivalent value of the encrypted version of the asset on the destination chain. While the transfer of the original asset remains intact, the process effectively creates a packaged version of the asset on the destination chain that contains its own supply parameters.
In a reverse process, called burn and shake, the system burns (destroys) the locked asset and mints (releases) the locked token, making it redistributable back to the native blockchain.
While there are several bridges to Solana, the most popular are the portal (formerly the Wormhole) and the Allbridge, which are locked at total cost.
The process of connecting on a decentralized bridge platform
The following outlines the process of connecting using the portal.
Step 1: Select blockchains
The bridge requires the user to select the source blockchain (the chain from which the assets come) and the target blockchain (Solana).
Step 2: Connect the bag
Connect the Web3 wallet to the bridge using the “Connect” button. A prompt will appear asking the user to select from various supported wallet providers and connect them to the bridge.
Step 3: Select the property you want to transfer
After the wallet is connected to the bridge, the user must select the property from the “Select Token” drop-down menu. The user has to click on one of the supported assets list or search for the asset they want to transfer.
Usually, the interface displays the scale for the selected asset, allowing the user to identify the correct token. After that, they have to enter the amount they want to transfer.
Step 4: Connect the Solana bag
When the user clicks on the “Connect” button, the interface will display several supported Solana wallets and the user can select from the options provided.
Click the appropriate option to connect to the bridge and follow the prompts in the wallet.
Step 5: Create an associated token account
Once the source and target wallet are connected, the user needs to create a token account in the Solana wallet by clicking the “Generate Linked Token” button to receive the tokens. If a user already has a linked token account, they can go directly to the next step.
Step 6: Bridge the funds
The user must approve the token transfer through the bridge interface and verify the transaction in the connected wallet. You can send assets to the bridge using the “Transfer” button.
Step 7: Refund
When the fund allocation is complete, the user can use the Solana wallet and use the “Redeem” button to claim the tokens from the bridge.
Integration process on the central bridge platform
Let's understand how to connect from network to Solana using OKX crypto exchange.
Step 1 Transfer the money to the wallet
The user needs to transfer the funds they want to bridge to their OKX wallet and then go to the “Bridge” section.
Step 2: Connect the bag
The user now has to click on “Link Wallet” and scan the QR code to link to the OKX wallet. Users can select “OKX Wallet Extension” to add a wallet extension to their browser. Users using other wallets such as MetaMask can select “Other”. To facilitate the connection of the OKX wallet with OKX Swap, they must enter the password of the OKX wallet and select “Verify”.
Once the wallet is connected to OKX Swap, the user can complete linking Tether (USDT) to Solana.
Step 3: Complete the process
The user now chooses the source blockchain and the destination wallet (in this case, Solana). They must select the signal in the source and destination chains that they want to bridge. The interface shows the actual amount the user receives.
Select “Exchange with chains” and confirm the transaction when the wallet is displayed. After that, the transfer through the bridge will be completed.
Understanding terminology and payment structures
It is important to understand the terms and fee structures before starting to link properties.
slip
Slippage refers to the difference between the expected transaction price and the price at which the transaction actually takes place. Low slippage works in users' favor. Without flexibility regarding slippage, if there is a price change, the transaction will be terminated and the user will lose the network fee. When the liquid in the tank is limited, it will be necessary to leave some slip.
Marketing way
In the context of an asset bridge, a transaction path refers to the path of an asset during a swap or bridge transaction that may involve multiple levels or platforms. It is important to note that exchanges through centralized exchanges operate under the guise of decentralized finance (DeFi) rather than as a bridge.
However, not all centralized exchanges work this way. The algorithm automatically selects a suitable bridge. Some users give users the option to change the bridge manually.
Network fee
This refers to the cost of facilitating a bridge using the blockchain network. The fee structure is multi-layered. Four types of fees are usually charged: source network fees, destination network fees, bridging fees, and conversion fees.
A user pays source network fees to the source network to transfer the property. Access network fees are paid by the destination network (in this case, Solana) to allow transactions from the bridge to the wallet.
Bridge tolls are paid at central platforms on bridges that operate under the interchange. Conversion fees are an additional amount that users have to pay when switching between virtual assets during the bridge process. For example, if a user is converting Cosmos (ATOM) on the Cosmos network to USDT on the Solana network, the ATOM to Solana (SOL) conversion fee is required.
Transaction time
Transaction time in bridges depends on three variables: source network authentication time, bridge processing time, and destination network authentication time. For example, when the source network is Ethereum, the confirmation time depends on the amount of gas used.
As for the destination network, Solana is known for its extremely fast processing, and the money should reach the wallet in seconds. The efficiency with which the bridge is used is also a factor in the time spent in the bridging process.
Common risks regarding blockchain bridges
Blockchain bridges risks such as centralization, operational risks such as downtime or maintenance, and smart contract errors or defects. Some bridges rely on a centralized authority to facilitate the transfer of digital assets, which is not compatible with the blockchain ecosystem. Also, like all software, bridges are subject to downtime or maintenance.
Sometimes transactions get stuck when using bridges. However, famous bridges are designed to handle such situations and can solve the problem in the end. If the transaction is stuck due to insufficient gas, the money will be returned to the user's wallet.
Examples of hacking that happened through the blockchain bridge
Several notable hacks have occurred through Blockchain Bridge, revealing vulnerabilities in these platforms:
Poly Network Hack (August 2021)
This was one of the biggest DeFi hacks, with nearly $600 million stolen due to a flaw in PolyNetwork's smart contracts. After talking to the Poly Network team and the larger crypto community, the hacker eventually recovered most of the funds.
Wormhole Network hack (February 2022)
A hack that hit a wormhole bridge connecting several blockchains, including Ethereum and Solana, cost more than $320 million. Fake Ethereum packaged tokens were created as part of a hack on the Solana blockchain.
Ronin Network Hack (March 2022)
The Ethereum sidechain of the Ronin Network, built for the Axie Infinity game, has lost nearly $625 million in Bitcoin (BTC). After the hackers compromised the private keys, they started making unauthorized withdrawals.
Harmony Horizon Bridge Hijacking (June 2022)
Horizon Bridge, operated by Harmony, has been exploited for around $100 million. The attackers compromised the bridge's security by breaking into a multi-signature wallet that secures the bridge's finances.
Multichain (July 2023)
In the year In July 2023, Multichain, a cross-chain bridge, experienced significant exploitation, resulting in a loss of $125 million in cryptocurrencies, mainly by Fantom. The bridge was temporarily shut down due to unforeseen problems, and Multichain CEO Zhao Juju was arrested by Chinese authorities. Contrary to previous claims of decentralization, Zhaoju is revealed to be in sole control of the protocol's funds. Currently, the Multichain bridge is inactive.
It is important for users to exercise due diligence before choosing a bridge to prevent malicious actors from withdrawing funds from their wallets. Additionally, having a separate wallet for use with Bridge is a smarter approach than using multiple holdings of the main wallet.
