Harmony bets on Bitcoin, Ethereum bridges to improve cross-chain ecosystem
Decentralized platform Harmony saw renewed traction this month. Its native cryptocurrency ONE reaped the benefits of this interest. After hitting a low of $0.13 on 4 December, the price of ONE rose by 163%. Further, the token marked a new all-time high of $0.38 on 14 January.
Interestingly, the token has lost over 53% of its valuation since then. Well, possibly due to larger market corrections. Even so, the platform’s developers have revealed ambitious plans to take Harmony to new heights in the coming year.
According to a recently released roadmap, the main focus of development will be on adoption, interoperability, decentralization, and zero-knowledge proofs. This would be achieved by building bridges with other important blockchain protocols, notably including Bitcoin and Ethereum.
Harmony is a Layer 1 smart contract platform that makes use of sharding for its consensus mechanism. This allows the protocol to scale significantly with increased block sizes and throughput. Thus, making it fully Ethereum interoperable “similar to layer 2 protocols.”
The blog post noted that both the Bitcoin and the Trustless Ethereum Bridge were released on Harmony’s Testnet in November last year. This, in order to further its use cases.
“An example of utility is a cross-chain exchange without custodial risks… Ethereum developers can easily scale their applications with Harmony to enjoy our 2-second finality and cheap fees.”
Moreover, apart from the top two blockchains, the development of bridges with other decentralized protocols is also underway, the announcement noted. These include Polygon, Terra, Cosmos and Polkadot, among others. The roadmap also highlighted that a host of other ecosystem-centric developments are in different stages of release – Including derivatives staking, decentralized nodes, and secure resharding.
It was further highlighted that Harmony’s path towards interoperability will also include the release of Cross-Shard Composability and Cross-Chain Communications. While the former will focus on atomic swaps of assets and inter-shard contracts, the latter will be aimed at building chain relays as smart contracts and data availability layers.
It should be noted here that Harmony’s plans to develop its ecosystem further do not seem too far-fetched, especially considering the steep rise in its adoption. The total value locked in the protocol hit an ATH of $1.25 billion earlier this month, up from just $135 million towards the beginning of October.
While it might be giving a hard time to layer 2 protocols, Harmony still faces stiff competition from blockchains similar to itself, namely Fantom, NEAR protocol, and Cosmos. Recently, this group of alternate layer-1 blockchains has been outperforming more established ones such as Binance Smart Chain and Terra, according to CoinMarketCap.
It also noted a “dramatic uptick in their on-chain activity, wallet counts, DApp ecosystems, and total value locked TVL in recent months.”