Interconnecting Tezos to other blockchains

I want to talk about the pro’s and con’s that interconnection with other blockchains. ICON developers are interested in integrating Tezos into their Blockchain Transmission Protocol.

To me is an analogy to the US dollar, is allowing the USD (Tez) to be used in other countries (blockchains), the USD It’s literally the global reserve currency and used for all global trade,
It creates cross-network economic activity for both networks. Imagine if the US decided the dollar not being traded over other countries as the reserve currency, instead to be an isolated market in the world?

Tezos users will be able to access DEFI, NFT’s, products of other blockchains and vice versa. All multi-directional bridges. And there is no management of relays because icon network takes care of it. Some blockchains like DOT already bridging with ICON.

Edit: One argument against it is that the reason to build defi products on tezos is that that’s where the tez is, The easier you make it to use tez in other chains for defi product, the lower the incentive to build defi products on Tezos, the less relevant the chain becomes. it could bring net damage.

Please provide opinions, thanks in advance.


@tezoswakenbake thank you for raising this topic and I’d be happy to comment on BTP (Blockchain Transmission Protocol) for the Tezos community to learn more.

BTP is a general purpose interoperability solution that can transfer any type of data between networks. It is secured entirely by cryptography and smart contracts with Relays in between simply to pass data - Relays play no factor in security or decentralization of BTP.

Any chain in the BTP Ecosystem is directly connected with one another - ICON is not a middleman. We provide the Relay infrastructure, BTP standard and APIs necessary to integrate into different applications.

Here is a recent article on how BTP works, key differentiators and value propositions. I’ll also summarize some differentiators and potential use-cases for the Tezos community below:

Differentiators from current bridging solutions:

1.) Verifier Contract - security of BTP is done through cryptography. The Verifier smart contract deployed on all connected networks is able to replicate the hashing process and verify validator signatures from source blockchains to ensure all relayed data is accurate.

It does not rely on proof-of-stake of Relays (slashing relays if they try to steal/lie), it does not rely on proof-of-authority (hand-picked relays that are simply trusted), and there’s no reliance on consensus of relays (multi-sig, 2/3+1 PBFT, etc.). This makes BTP as secure with 1 Relay as it would be with 100. More Relays just leads to more liveness

2.) Out-of-the-box Generalizable Architecture - BTP leverages Service Contracts (BSH). Each Service Contract can be a specific use-case developed by a specific app developer (though we have a few standards for things like token transfer). After developing your specific Service Contract, the app developer would submit a pull request to get it added to the BTP Network. Once adopted, your specific service is able to leverage the existing Relay network funded by ICON’s block rewards - there’s no need to incentivize your own Relays or set up your own network.

3.) All networks in the BTP Ecosystem are directly connected with one another, there’s no need to build a bridge per network.

Use-Cases for XTZ Community:

1.) Inclusion of other assets in Tezos DeFi products - ICON will be aggressively growing the BTP Ecosystem which will give you access to assets across all connected ecosystems. Maybe a DApp developer on Tezos would like to target users of Uniswap, no better way then offering a seamless way to either airdrop your XTZ-based asset to UNI holders or offer an incentive for UNI holders to supply their token on a Tezos-based product.

2.) Calling contracts on other networks - Tezos-based smart contracts will be able to call contracts on other networks. Perhaps a Tezos DApp developer wants to make an app that allows XTZ holders to borrow assets directly from DeFi products across several different networks.

3.) NFT Metadata transfer - Perhaps a Tezos Dapp developer would want to build an NFT marketplace on Tezos that can bring in NFTs from other networks. You could do this with BTP and actually bring the metadata with it rather than just a wrapped token.

The above use-cases are just what I’m thinking of on the spot, but anybody can develop their own Service Contract, there’s really no limit to the possibilities.

I hope this helped you guys! My next steps would hope to be discussing with developers experienced in Tezos development so we can contract them, add them to the BTP Working Group, and get started on implementation, thanks!


My vote is to implement a relay chain on Tezos to become a leading interoperable blockchain as opposed to only bridging to a different relay chain, which may siphon value away from Tezos.


I do think that this development should be pretty positive for the Tezos ecosystem. There are some disctinctive technical advantages to smart contract development on Tezos even if it is nowhere as fleshed out as the Ethereum based one. But it is always a risk to develop skills and invest time in a smaller ecosystem. So having the ability to access the bigger markets is great.

This is no nation where it might make sense to develop a fledgling industry by protectionist tarrifs.

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Not even in a nation make sense, for protecting 5000 American jobs, they condemn millions of consumers which are also American. The one who ends up paying that tax, is the American consumer, now by applying tariffs (which is a tax), the consumer will no longer have that surplus $$$ that otherwise it would have consume/invest in other areas of the economy, that would also be creating jobs in those areas.

Protectionism is bad for the economy of any country, countries that are applying tariffs are basically putting the rope around thier own neck. Tariffs allow crony capitalism between politics and dishonest businessmen, and it all end up being paid by the American consumer.

The only fair and moral social system, is laissez-faire capitalism (individualism). Protectionism is collectivism, it only a superficial variant of other collectivism based social systems, like socialism, communism, national-socialism, fascism, etc. None of them have free markets.

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Yes, I agree also with this, ICON interoperability results in burning ICON native token ICX thanks to BTP fees. If you want the benefits of running an interoperability solution (burning TEZ), yes you would need Tezos to become an interoperability protocol as well. It is the same for all bridges. Bridges charge a fee for operations. If you use renBTC, BTC fees go to REN holders.

Although, it is technically possible to have a deep level of collaboration at the protocol level. ICON Network uses its own inflation to pay for Relay services, If tezos wants to use block rewards to fund relayers of ICON BTP, then it is possible for TEZ to be included in the burning mechanism they designed. Instead of making our own competitive interoperable solution, we just fund their BTP and get the same benefits.

Or we just make our own interoperability solution.

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I believe we already have this through zkChannels however that only connects us to Bitcoin and ZCash. Icon would connect us with many more coins in one shot. I agree with you that we should create our own cross chain relay, but at the same time we should connect via other projects in parallel. The more channels we have the more arbitrage opportunities. More arbitrage means more volume and so more transactions fees to collect which helps the value of the system.

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Benny mentioned it might be possible to have a deep level of collaboration at the protocol level. The ICON network relays will benefit the ICX holders by a burning mechanism, but they are the ones that funds the relays with the ICON inflation. He says, that if Tezos via governance, contribute to fund the relays with Tezos inflation, they can make the burning mechanism to work in both ways. Burning also XTZ. I don’t know what you guys think of this? Or it is just better if we build our on relays? They already have all the work done, we could fund their relays with our inflation and use their burn mechanism, we can also via governance stop funding their relays if we want at any day.

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