What is a Bridge?
Quick Definition
A bridge is a mechanism that enables the transfer of assets or data between different blockchain networks.
Full Definition
Blockchains operate as independent systems. Tokens on Ethereum don't natively exist on Solana, Bitcoin doesn't natively exist on Arbitrum, and so on. Bridges solve this problem by allowing assets to move between networks. Typically, a bridge works by locking tokens on the source chain and minting a representation of them on the destination chain. When the user wants to move back, the representation is burned and the original tokens are unlocked.
Bridges have been essential to the multi-chain landscape that has emerged in recent years. They allow users to access different ecosystems, take advantage of different applications, and move liquidity to where it's most useful. They're also one of the most technically complex parts of the blockchain stack.
The risks of bridges
Bridges have been one of the most frequent targets of exploits in crypto history, with billions of dollars lost to bridge-related hacks. The reasons are structural: bridges hold large amounts of value in custody contracts, they introduce trust assumptions that pure on-chain protocols don't have, and the technical complexity of cross-chain communication creates more attack surface. As a result, sophisticated users tend to approach bridges with caution and evaluate the security model carefully.
Bridging and Steady
Because Steady's rebase mechanism adjusts supply simultaneously and proportionally across all wallets, traditional bridging is technically incompatible with how the token operates. There is no official STDY bridge, and we don't endorse any third-party bridges. Users who want to hold STDY on another supported network can redeem on one chain and acquire on another through our primary market.
Related Terms
Blockchain Network
ReadA blockchain network is the system of connected participants and infrastructure that validates, records, and maintains data on a specific blockchain.
Smart Contract
ReadA smart contract is a self-executing program that runs on a blockchain and automatically enforces the terms of an agreement when specific conditions are met.
Wrapped Token
ReadA wrapped token is a token that represents another asset on a different blockchain or in a different form, typically backed 1:1 by the original token or asset.
Other Glossary Items
Learn about common and essential terms related to Steady and other stablecoin protocols.
Algorithmic Stablecoin
ReadAn algorithmic stablecoin attempts to maintain its value through automated rules that adjust token supply based on market demand, rather than holding equivalent reserve assets.
AML
ReadAML (Anti-Money Laundering) refers to the laws, regulations, and procedures designed to prevent the use of financial systems for laundering the proceeds of crime.
APY
ReadAPY, or Annual Percentage Yield, is the standardized rate of return an asset generates over a year, including the effect of compounding.
Arbitrum
ReadArbitrum is a Layer 2 blockchain network built on top of Ethereum, designed to offer faster and cheaper transactions while inheriting Ethereum's security and infrastructure.
Asset Backing
ReadAsset backing refers to the real-world or on-chain assets held by the issuer to support the value of every token in circulation.
Asset Locking
ReadAsset locking refers to restricting access to funds for a defined period or condition, during which they cannot be transferred or used.
Asset Segregation
ReadAsset segregation is the practice of keeping client or backing assets separate from the issuer's operational funds, protecting them from the issuer's other obligations.
Audit
ReadAn audit is an independent examination of a protocol's code, reserves, or operations by qualified third parties to verify accuracy and compliance with stated claims.
Backing
ReadBacking refers to the assets or mechanisms that support a stablecoin's value and help it maintain its intended reference value.
Blockchain
ReadA blockchain is a distributed digital ledger that records transactions across a network of computers in a secure, transparent, and tamper-resistant way.
Clarity Act
ReadThe Clarity Act is a proposed US legislative framework intended to clarify the regulatory treatment of digital assets, defining when they should be treated as securities versus commodities.
Collateralization / Over-collateralization
ReadCollateralization refers to the ratio between the value of assets held in reserve and the value of tokens issued. Over-collateralization means holding more in reserves than the value of tokens issued.
Composability
ReadComposability refers to the ability of different protocols, contracts, and tokens on a blockchain to interact and combine with each other seamlessly.
Counterparty Exposure
ReadCounterparty exposure refers to the risk that another party, such as a bank, custodian, broker, or service provider fails to fulfill its obligations, potentially affecting the assets or funds it holds.
Custodial vs. Non-Custodial
ReadCustodial means a third party holds the private keys to your assets on your behalf. Non-custodial means you hold your own keys and control your own assets directly.
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