(Fungible) Token Bridge
The (fungible) Token Bridge is the main feature of the Cross-Chain Bridge (next to the Non-Fungible Token (NFT) Bridge). The goal is to allow almost any token to be bridged between the supported networks as long as there is enough liquidity available on the target network. For tokens that have the same contract address on different networks, the bridge is permissionless and projects can self-list their token. For different contract addresses across networks, a token mapping needs to be added to the Bridge to enable bridging.
The bridge uses liquidity pools and an innovative fee-participation scheme to attract the liquidity needed for its bridging transactions. The majority of the protocol incentive or bridging fees collected is circulated back to the communities and liquidity providers - into the Liquidity Mining Pools and Reward Pools. For certain tokens, Farms exist that act as an additional incentive to provide liquidity and eventually grant access to the higher reward-paying Reward Pools compared to the Liquidity Mining Pools.
The following pages explain the underlying concepts in more detail.
The Smart Contracts are deployed on every connected chain. These contracts handle the release and deposit of tokens. The communication between the different networks works by using oracle nodes as a source of truth. A deposit takes 20 blocks to be confirmed on the deposit chain, until the tokens can be released on the destination chain.
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