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The company will use the funds for the development of London Bridge — a trustless solution that will link Algorand to Ethereum. By launching the bridge, Algorand hopes to boost the liquidity of its network, and eventually connect to other chains, as well.
In its recent press release, the Algorand Foundation announced that it awarded a grant for the development of the so-called London Bridge — a trustless bridge that will connect it to Ethereum’s network. The bridge is being developed by Applied Blockchain, and the Foundation expects that it can be used to integrate Algorand with other blockchain networks, as well.
The London Bridge represents a massive opportunity for Algorand. It means that the project will gain access to other networks, which is a positive development for the progression of Web3, and Algorand’s own interoperability. But, more importantly, it will also allow for a huge influx of liquidity to the growing network.
Despite having numerous advantages over networks such as Ethereum’s, such as high scalability, low transaction cost, and low latency — Algorand still struggles with other issues. One of them is the lack of liquidity, especially as Ethereum still dominates the industry when it comes to the number of DeFi and NFT projects that run on its network.
The Algorand Foundation has decided to address this by providing a grant for a bridging solution that will connect Algorand to the industry’s largest development platform. The grand went to a London-based software development firm called Applied Blockchain, which will use the funding to develop the London Bridge and bring it to the market.
Apart from the London Bridge, Applied Blockchain is also working on several other applications on Algorand, which made it a clear choice for the Algorand Foundation. The company will join forces with Algorand Inc. to ensure that London Bridge will be low-cost, safe, and easy to use.
The project’s long-term plan is to have all verification of the other chains performed in Algorand’s smart contracts. Algorand intends to achieve this by incorporating state proofs into the Algoran Consensus. Through the collaboration, the two companies will also enable London Bridge to validate the state of other chains and block headers trustlessly.
Finally, the Algorand Foundation will also be able to use this partnership to allow Applied Blockchain to cement a DeFi infrastructure on Algorand’s network. Eventually, this will help the ecosystem turn into a space where DeFi will be able to thrive.