With the ability to cross chain swap and bridge on Rainbow, it’s important to recap what cross chain swapping and bridging are!
What are cross chain swaps?
Each country has its own unique currency. Dollars, for example, cannot be used in China and vice versa with yuans in America. Currency systems are independent of each other, and different ecosystems of blockchains and networks are also independent. Without using cross chain swapping you cannot transfer BTC directly to ETH, since there is no interoperability between these assets. In the traditional financial system, this problem is solved by automatic currency conversion. So if two people (one with USD and the other with CNY) want to exchange their currencies for each other, each of the parties can give the other the number of coins equivalent to the change according to a certain rate. For example, $100 would be equivalent to about ¥ 636,099.
The same above example happens in the crypto space! Cross chain swaps allows for us to swap/exchange tokens on different chains. You can swap your mainnet Ethereum for tokens on Optimism, Arbitrum, Polygon, and vice-versa!
What is bridging?
A bridge connects two different blockchains to allow the transfer of tokens between them. To quote ethereum.org:
Blockchain bridges work just like the bridges we know in the physical world. Just as a physical bridge connects two physical locations, a blockchain bridge connects two blockchain ecosystems. Bridges facilitate communication between blockchains through the transfer of information and assets.
Cross Chain Swaps and Bridging with Rainbow:
Rainbow makes the swapping and bridging process simple and fun! Like with the ability to bridge mainnet USDC to Optimism USDC, Rainbow makes these processes straightforward to participate in while providing a clean experience at every step of the way.
You can review our swapping guide any time for instructions on how to conduct swaps and what things you can do to customize your swaps:
Swap/trade Tokens and Cryptocurrencies
Swaps on Rainbow are better than ever! For the first time, Rainbow has gone on-chain to get you the best swap price possible. Rainbow's new contract is now available on Ethereum Mainnet, Arbitrum, Optimism, and Polygon. In this article, we'll guide you through the process of swapping these tokens on either your Android or iOS devices along with the different resources at your disposal.
Introduction to blockchain bridges | ethereum.org
Page last updated: November 2, 2022 Web3 has evolved into an ecosystem of L1 blockchains and L2 scaling solutions, each designed with unique capabilities and trade-offs. As the number of blockchains protocols increases, so does the demand to move assets across chains. To fulfill this demand, we need bridges.
What Are Cross-Chain Swaps? An Introduction | SwapSpace Blog
In the ever-changing world of crypto, there are many hot new things that are talked about but not fully understood by the public. This article is an intro to one of those topics - cross-chain swaps. More articles talking about this in depth to follow.
What are bridges in blockchain and how do cross-chain swaps work?
There is a lot of innovation happening in the Crypto / DeFi space. While Ethereum is the dominant blockchain for DeFi (Decentralized Finance) economy there are also many other chains building and developing competitive DeFi systems today such as: Algorand, Avalanche, Cosmos, Polkadot, Tezos, Solana etc.