Co-chain and Decentralised Token Bridge

General
1

Hello,

I am doing my research on CBDC (Central Bank Digital Currency) and understanding how Alogrand can be one of the Blockchain in this ecosystem.

My query is regarding Co-chain and Decentralised Token Bridge.

Co-Chain
These are private (permissioned) blockchain, a Federated Consortium having their validators running its Algorand consensus. This shield the transactions from the outside world and provides Algorands features like instant finality, ASA, Atomic Swaps and TEAL (layer-1) smart contract.
Here are some of my questions

  • Let’s say Marshall Island is running its co-chain with their currency in the form of ASA on this co-chain. How can they bring this asset to the main-chain?
    Since both co-chain and main-chain are running the same consensus, they can quickly verify each other assets and transaction. My doubt is - in the co-chain we have the asset with asset id 111, how can I bring this asset id to the main chain. As main chain will not be having this asset id part of its main chain. How do the asset creation and transfer happen between both chains?

  • What is the role of Algorand’s native token Algo in co-chain? Is it still used for consensus or co-chain can create their native token for consensus. And Algo’s purpose is only for communicating with main-chain.

  • Also, how will Algo be represented in co-chain? In the main chain it is the native token when it is moved to the co-chain, is Algo represented as an ASA?

Decentralised Token Bridge
Connects chains with different consensus, however contract functionality should be there in that block chain. And it generates CBC (Certified Blockchain) proofs to determine the asset and its state on any blockhchain. (https://arxiv.org/pdf/1905.09743.pdf)

Here are some of my questions:

  • When we talk about token-bridge, does it actually moves assets from one blockhchain to another. Suppose Swiss Central Bank is running on Hyperledger, can the asset on hyperledger be moved using token bridge to Algorand’s main chain?

  • Or it is more like a cross-chain deal, where these assets lie in the blockchain itself, however using Swiss dollar in Hyperledger, I can transact with Algorand’s mainchain to transact an ASA. However these assets will not be moved to another blockchain, CBC (Certified Blockchain) proofs and smart contract can make this deal happen?

3 Likes
2

Great questions. I don’t know details about co-chains, but I guess that:

  1. moving asset from one co-chain to another will require a new ASA creation which will be somehow linked to other chain.
  2. Both, in case of a cross co-chains transfer and 2 different chains transfer (like in your example: Hyperledger <-> Algorand co-chain) will require implementation of a light client and relayer. Light client will validate transaction based on the counterparty consensus. Relayer will feed the transactions. There is always a trust ingredient - you need to trust that the counterparty consensus works, and that relayers will not censor transactions.
3

Watch https://www.youtube.com/watch?v=zOlshmNShvU

Silvio discusses co-chains.