Chainlink has launched its Cross-Chain Interoperability Protocol (CCIP). As of July 20, CCIP is available to all developers across five testnets: Arbitrum, Goerli, Avalanche Fuji, Ethereum Sepolia, Optimism Goerli, and Polygon Mumbai.
CCIP is supported by Chainlink's decentralized oracle networks, known for securing tens of billions of dollars and enabling over $8 trillion in on-chain transaction value. It stands out as the most secure, reliable, and user-friendly interoperability protocol for creating cross-chain applications and services.
CCIP provides Simplified Token Transfers, which allow protocols to initiate quick token transfers across chains using audited token pool contracts that they control. This can be done without writing custom code and in a fraction of the time it would take to build from scratch.
CCIP also includes additional safety mechanisms surpassing those offered by other cross-chain solutions, such as customizable rate limits on token transfers and a separate Active Risk Management (ARM) Network that verifies all cross-chain transactions. The protocol offers a single, straightforward interface through which dApps and web3 entrepreneurs can securely fulfill all their cross-chain needs, including token transfers and arbitrary messaging.
Due to the inherent risks of cross-chain interoperability, a security-first mindset has been incorporated into CCIP. Some security features include an Active Risk Management network that scans for malicious activity, decentralized oracle computation from a vast selection of high-quality node operators with verifiable on-chain performance histories, and the Off-Chain Reporting (OCR) protocol, which already secures significant value across multiple mainnet blockchains.
Chainlink's CCIP enables a variety of use cases:
- Transfer tokens across blockchains from a single interface without needing to build your own bridge solution.
- Launch cross-chain lending applications that allow users to deposit collateral on one blockchain and borrow assets on another.
- Bridge liquid staking tokens across multiple blockchains to maximize their utilization in DeFi apps on other chains.
- Give users the ability to mint an NFT on a source blockchain and receive it on a destination blockchain.
- Build smart contract wallets with native CCIP capabilities to enhance user experience in making cross-chain function calls. For instance, enable users to approve transactions on any chain using a single wallet.
CCIP has been adopted by DeFi leaders such as Synthetix and Aave to tap into the potential of the cross-chain economy.
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