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Universal Blockchain Asset: A token you can send to any blockchain
Imagine a digital asset that you can send from one blockchain to another and how much easier it would be to transfer value around the world. We’re not talking about bridging or wrapping techniques, which are well known and cumbersome, but a single asset that can be sent between users on their preferred chain, no matter what that is. nChain’s Dr. Owen Vaughan has invented a protocol to do just that, sharing details on “Universal Blockchain Assets” (UBAs) with Behind the scenes at CoinGeek on the sidelines of the London Blockchain Conference 2024.
To learn more about the technical details of how UBA works, watch the full video below.
UBAs could prove to be bigger news than the invention of Order them or ERC-20 tokens, both of which have created frenzies of new activity in the blockchain asset world.
The UBA protocol creates a new medium of transfer called a “packet,” Vaughan said, deliberately avoiding the word “transaction.” It works on the premise that all blockchains have some common features, namely immutable databases and double spending protections. A package, in effect, is a code that authorizes the transfer of ownership. It records the details of its previous owners with “inputs and outputs in its inputs,” appearing on the target blockchain not as a “bridged” or representative token, but as a real asset with native unspent outputs.
Wrapped or Linked Tokens and Why They Are a Poor Solution
Vaughan says he drew on personal experience to create the UBA protocol. Recently married, he and his wife visited their home country of Argentina, where they experienced firsthand some of the country’s everyday impacts. financial difficulties.
In March, inflation in Argentina was 11%. Over the past 12 months, it has been 300%. The situation has led to currency controls, making it incredibly difficult to send money from other countries; even banks and money transfer companies consider it too risky.
The simple cross-border transfer of value is one of the Bitcoin and BlockchainEarly promises of, so Vaughan instinctively turned to this solution. Unfortunately, while trying to use Coinbase (NASDAQ: CURRENCY) to acquire USDC stable currencyInstead, it purchased an asset called USDbC, a “bridged” or “wrapped” version of USDC that exists on the Base network. While a USDbC technically represents a USDC, the two tokens exist on different blockchains and are not interchangeable.
“Why does USDbC exist? Who needs it? It’s a really terrible user experience,” he said.
Vaughan said a company should be able to issue a token backed by U.S. dollars that can be used on any blockchain. Having a universal asset would allow more people to use blockchain and digital assets with much less effort. risk and much lower costs.
Finding the blockchain that works best using the same resource on each
The UBA protocol is pretty simple, Vaughan noted. It requires no third parties and a “bridge” to move between blockchains. This alone makes it superior to any other cross-chain solution available today.
However, this simplicity masks very complex thinking, he added, and it may be some time before his on-stage announcement is made. London Blockchain Conference 2024 to get established. People may actually need to use UBAs for a while before the benefits become clear.
Fees on different blockchains are a big part of this. Even popular ERC-20 stablecoins like USDC or Tether can be difficult or expensive to use due to the high “gas” fees required to move an asset. Presented with this same problem, a UBA holder could simply transfer the token to a cheaper blockchain and use it for small occasional payments.
This presents another potential downstream effect: by moving the same token across multiple blockchains, users will quickly discover which blockchains are cheaper and more efficient. As Vaughan put it, blockchains will have to “compete for the business of these tokens.” Their users aren’t locked into using a single chain just because their token of choice resides there.
AS ChainResearch director Vaughan prefers the The BSV Blockchain as the most efficient option, win over high transaction volumes, low fees and data/script processing capabilities.
“But now we’ll see how it ends,” he said.
Watch: Blockchain is Much More Than a Digital Asset
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