In a significant development for the blockchain industry, IoTeX's community has overwhelmingly voted in favor of Improvement Protocol 21 (IIP-21), paving the way for bridging IOTX, the native coin of the IoTeX network, to Ethereum.
The proposal received overwhelming support from the IoTeX community, with a final tally of 306 million IOTX (73.77%) voting in favor of the bridge, while 109 million IOTX (26.23%) opposed the proposal.
A total of 334 wallets participated in the vote, whose successful outcome reflects the community's enthusiasm for expanding the utility and reach of IOTX through cross-chain interoperability.
Enormous potential for Ethereum and IoTeX
Blockchain bridges have gained increasing attention as they offer numerous benefits to the blockchain ecosystem. By enabling tokens to move seamlessly between different blockchains, bridges address scalability challenges, reduce network congestion, and enhance user experiences.
“One of the primary motivations behind IIP-21 is to leverage Ethereum's robust DeFi ecosystem, increase IoTeX token liquidity within Ethereum, and build a vibrant developer and user community,” said IoTeX CEO and Co-Founder Raullen Chai. “The proposed bridge between IoTeX and Ethereum holds immense potential for both platforms and the broader blockchain community,” he added.
Presently, IOTX exists on the IoTeX network and is bridged to Binance Smart Chain and Polygon.
However, the legacy ERC-20 version of IOTX on Ethereum, known as IOTX-E, has limited supply and circulation, restricting its usage in DeFi protocols and availability on major centralized exchanges.
The proposal aims to address these limitations by implementing CIOTX (Cross Chain IOTX), a wrapped version of IOTX on the Ethereum blockchain. CIOTX will be fully backed by the circulating IOTX on IoTeX, ensuring a sufficient supply for utilization in any Ethereum-based DeFi application and circulation on centralized exchanges.
This strategic move enables IoTeX to tap into the thriving DeFi ecosystem on Ethereum, including on popular protocols like Uniswap, Curve, Aave, and Compound.
Seamless token swapping
Introducing CIOTX on Ethereum will facilitate the seamless swapping of tokens between CIOTX and IOTX-E. By listing CIOTX alongside IOTX-E on decentralized exchanges like Uniswap and Curve, users can exchange the two tokens at market prices, with the market determining their respective values based on demand. This feature enhances liquidity and provides greater flexibility for users in managing their IOTX assets.
The benefits of blockchain bridges extend beyond IoTeX and Ethereum. With IoTeX diverting some network traffic away from Ethereum, the bridge helps alleviate congestion and scalability challenges the Ethereum network faces. By dispersing transactions to other less congested blockchains, bridges contribute to the overall improvement of blockchain scalability and user experience.
A fantastic step forward
The successful passage of IIP-21 signifies a significant step forward for IoTeX and the broader blockchain community. With the bridging of IOTX to Ethereum and the introduction of CIOTX, IoTeX aims to create a comprehensive ecosystem of IOTX-backed tokens that can be utilized across multiple blockchains.
This integration of IoTeX and Ethereum opens new possibilities for DeFi applications, enhancing the utility and value of IOTX while promoting interoperability within the blockchain landscape.
As the blockchain industry continues to evolve, bridges like the one proposed in IIP-21 play a crucial role in unlocking the full potential of different blockchain platforms. By enabling seamless token transfers, bridges enhance scalability, reduce congestion, and foster collaboration between blockchain ecosystems, ultimately driving innovation and adoption in the decentralized finance space.
Leveraging IoTeX’s speed and efficiency
With the bridging of IOTX to Ethereum, businesses can now explore the possibility of enabling instant payments using IOTX or CIOTX tokens, leveraging the speed and efficiency of the IoTeX network while benefiting from Ethereum's vast user base and DeFi infrastructure.
The successful implementation of IIP-21 and bridging IOTX to Ethereum represent a significant milestone in the blockchain industry. As blockchain bridges continue to gain prominence, we expect to witness the emergence of new use cases and innovative applications across various sectors, ultimately driving the widespread adoption of blockchain technology and fostering a more interconnected and efficient decentralized ecosystem.