IDEAS home Printed from https://ideas.repec.org/p/arx/papers/2109.06847.html
   My bibliography  Save this paper

Wrapping trust for interoperability. A study of wrapped tokens

Author

Listed:
  • Giulio Caldarelli

Abstract

As known, blockchains are traditionally blind to the real world. This implies the reliance on third parties called oracles when extrinsic data is needed for smart contracts. However, reintroducing trust and single point of failure, oracles implementation is still controversial and debated. The blindness to the real world makes blockchains also unable to communicate with each other preventing any form of interoperability. An early approach to the interoperability issue is constituted by wrapped tokens, representing blockchain native tokens issued on a non-native blockchain. Similar to how oracles reintroduce trust, and single point of failure, the issuance of wrapped tokens involves third parties whose characteristics need to be considered when evaluating the advantages of crossing-chains. This paper provides an overview of the wrapped tokens and the main technologies implemented in their issuance. Advantages, as well as limitations, are also listed and discussed.

Suggested Citation

  • Giulio Caldarelli, 2021. "Wrapping trust for interoperability. A study of wrapped tokens," Papers 2109.06847, arXiv.org.
    • Handle: RePEc:arx:papers:2109.06847
    as

    Download full text from publisher

    File URL: http://arxiv.org/pdf/2109.06847
    File Function: Latest version
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sandeepa Kaur & Simarjeet Singh & Sanjay Gupta & Sangeeta Wats, 2023. "Risk analysis in decentralized finance (DeFi): a fuzzy-AHP approach," Risk Management, Palgrave Macmillan, vol. 25(2), pages 1-29, June.
    2. Giulio Caldarelli, 2022. "Overview of Blockchain Oracle Research," Future Internet, MDPI, vol. 14(6), pages 1-38, June.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:arx:papers:2109.06847. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: arXiv administrators (email available below). General contact details of provider: http://arxiv.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.