Despite the remarkable progress in the development of blockchain technology, private and public blockchain networks still operate in isolation.
In essence, several key aspects of this emerging ecosystem operate independently, with no cohesive flow of data or ways to combat incompatibility issues. Wanchain was founded with the primary goal of solving this problem.
“Wanchain provides the economic infrastructure for developers to build super financial applications that span multiple blockchains and communities.”
Launched during the ICO boom of 2017, Wanchain is an Ethereum-based blockchain interoperability platform.
The project aims to create a new financial ecosystem that allows for cross-chain transfers between different blockchains.
It is worth stating that Wanchain is not the only player working on this solution. There are other popular blockchain projects such as Polkadot, Ren, Cosmos, and Fusion, all working on different aspects of blockchain interoperability.
However, Wanchain features an entirely different architecture that focuses primarily on digital asset exchange. It is a “currency-agnostic platform” that distinguishes itself with its “cross-chain asset transfer” functionality.
This functionality allows Wanchain to connect with other blockchain platforms, including Bitcoin, Ethereum, and EOS, and enable asset conversion without the need for a bridging chain.
Since its launch in 2017, Wanchain has expanded to support other useful financial activities such as lending and borrowing, exchange and settlement, staking, and investments.
Amid the DeFi boom and several changes in the cryptocurrency industry, Wanchain has evolved to stay competitive. For instance, with interoperability between DeFi protocols, Wanchain is exploring an entirely new use case.
How does it work?
Whilst there are a lot of background technicalities surrounding Wanchain’s solution, real-world applications can be found in its cross-chain decentralized exchange, cross-chain mobile payments, connected enterprise blockchain, and decentralized financial applications.
Using its Storeman node infrastructure, Wanchain enables secure multiparty computation, atomic swaps, threshold key sharing, ring signatures, and disposable addresses. The result is built-in unbeatable security and privacy functions.
“Storeman nodes are nodes which verify cross-chain transactions and ensure the smooth and secure transfer of value between heterogeneous blockchains.”
Wanchain is fundamentally made up of three primary modules – registration, cross-chain transaction data transmission, and transaction status queries.
As the name implies, the registration module takes care of onboarding the original chain participating in the transaction. The chain is registered, assigned an ID, as well as dataset rules.
When a cross-chain transaction request is initiated, Wanchain’s Storeman nodes create a locked account that holds the funds being sent indefinitely.
Meanwhile, an equivalent value is transferred to the destination blockchain in the form of a corresponding mapping token. The locked funds can only be released when the value of the corresponding mapping token is returned to the original chain, at which point, the mapping token will be destroyed.
Simply put, if a user attempts to transfer 1 BTC from the Bitcoin network to Wanchain, the funds sent from the Bitcoin blockchain will be held in a locked account, while a corresponding 1 WBTC token will be transferred to the recipient. The locked BTC will only be released after the WBTC is sent back to the original account.
That being said, the cross-chain transaction data transmission module handles transfers and validations. Finally, the transaction status query module monitors the progress of transactions.
Compared to newer protocols like Polkadot, Wanchain appears to be the old kid on the block. However, despite its age, Wanchain has continued to evolve to stay relevant. First, it capitalized on its token staking features and has now ventured into the DeFi sector by facilitating interoperability.
Wanchain has hit several important milestones and sealed a plethora of strategic partnerships. The project is a member of the Blockchain Interoperability Alliance.