The increase in multichain interoperability solutions is allowing for disparate blockchain ecosystems to interact with each other in ways that were previously not possible.

Multichain Enhances Blockchain Interoperability

Multichain optionality is something that has become an increasingly more important topic of discussion within the crypto ecosystem as a whole. Before we explain and define multichain in depth, it’s worth noting why it has become such a prized feature — and what pain point it is ameliorating. In short, multichain protocols and tools are enhancing blockchain interoperability. 

Blockchain interoperability is the ability for separate blockchains — or their associated ecosystems — to interact with each other. By interact, we mean that they can communicate with each other through the ability to share data across blockchain protocols. This interoperability allows smart contracts, decentralized applications (dApps), and crypto to be transferred between chains. This allows crypto ecosystem users to move to the blockchain protocol that best suits their needs. Someone may switch to another chain to access cheaper or faster transactions. You may also wish to switch to a chain that is considered more secure or has a higher number of users and activity (in order to access the crypto capital and liquidity within that ecosystem). In order to understand the importance of interoperability within this space, it may be helpful to imagine a scenario in which a network you already use wasn’t interoperable. 

While this is something you’ve likely never contemplated, you can use whatever smartphone you have (Apple, Samsung, LG, and so on) to communicate on whatever network you use (Verizon, T-Mobile, AT&T, and more) with anyone else that also has a smartphone and a corresponding cellular plan. It doesn’t matter if their phone or their network (or both) are different; it’s still easy to call or text them in the same manner you would if they shared both your network and plan. Without this interoperability, both parties could need the same hardware (smartphone manufacturer) and cellular network in order to merely exchange text messages.

While interacting via text and call is simple, the ability for blockchains to interact — and exchange data — is still a frustrating pain point for users of the crypto ecosystem. You can’t use native bitcoin (BTC) on Ethereum, and you can’t use an Ethereum-based dApp on Bitcoin. This lack of interoperability has created siloed ecosystems within many of the major blockchain ecosystems. The desired ability for enhanced interoperability is the motivator behind enabling interoperability via multichain protocols and various other methods.

Defining Multichain

Before covering all the approaches to multichain, it’s worth defining multichain and related terms such as inter-chain and cross-chain. In these contexts, the word chain is shorthand for blockchain. The term cross-chain means the ability to migrate — or cross — from one blockchain to another. The term inter-chain is largely used in the same way, meaning the ability to go between blockchains. 

A portmanteau of multiple and blockchain, multichain (sometimes written multi-chain) is an increasingly popular term and refers to the ability for a crypto or smart contract to be found, used, or transferred on multiple blockchains. Multichain may also be used to refer to new blockchain ecosystem projects that feature a primary blockchain that can be connected to a variety of subsidiary blockchains. 

While these three terms are often used interchangeably, multichain can also have a nuanced meaning that conveys the ability for something to be initially deployed (launched) on multiple chains simultaneously. Cross-chain generally conveys a sense of moving something from its original blockchain to a different one.

Multichain Solutions to the Rescue?

On cellular networks, interoperability issues for communicating are largely a thing of the past (iPhone-only features notwithstanding). Blockchain enthusiasts are pushing for the same simplicity and ease of use for inter-blockchain communications. In the next articles in this five-part series, we’re going to cover the various approaches to blockchain interoperability, the pros and cons of various cross-chain tools, and the emergence of multichain ecosystems and tools.

Cheat Sheet:

• Blockchain interoperability refers to the ability for separate blockchain protocols to interact and communicate with each other. The lack of adequate interoperability is a continued frustration and point of concern within the wider blockchain ecosystem.
• Inter-chain, cross-chain, and multichain are terms used to refer to the ability for data to be transferred between — or used on — different blockchain protocols.
• Emerging multichain solutions are being launched with the goal of uncomplicating — and simplifying — cross-chain crypto communications.