Till now, DeFi was an amalgamation of blockchain and cryptography, but now the developers are moving on to unleash new capabilities with cross-chain DeFi.

1. Cross-Chain DeFi Technology: An Overview
As we know, blockchain technology has given rise to several revolutionary capabilities in the
present world. With the introduction of cryptocurrency, NFTs, DeFi, etc., we have come a long
way in transforming money transactions, loans, and much more. That’s when cross-chain DeFi
emerges as a recent rumble in the industry. Till now, DeFi was an amalgamation of blockchain
and cryptography, but now the developers are moving on to unleash new capabilities with
cross-chain DeFi. So, what all the latest buzz is all about? Let’s discuss this further.
What is cross-chain technology?
If you are familiar with typical blockchain technology, you might know that it prevents two
non-native blockchain networks from interacting. Therefore, the new cross-chain technology
is designed in such a way that it facilitates interoperability between independent blockchains.
This allows two blockchains to communicate and exchange data and resources. The cross-
chain technology is now used to develop several decentralized applications (dApps) to meet
today’s industry needs.
How cross-chain technology works with DeFi?
As we discussed earlier, cross-chain technology is the ultimate solution to the inability of
blockchains to interact with each other. Thus, when this technology is applied with DeFi, the
major impact is enhanced interoperability. Unlike traditional DeFi, cross-chain DeFi can offer
instant token swaps, multi-chain smart contracts transactions, etc.
What makes Cross-chain DeFi better?
● Interoperability – Since cross-chain technology improves interoperability, the cross-
chain DeFi allows the better exchange of services. Unlike traditional DeFi, it offers a
multi-chain experience, making the overall movement of assets and data more
seamless.
● Security pledge – With cross-chain DeFi, borrowers can share their collaterals across
platforms like Bitcoin, Ethereum, etc. Similarly, lenders can also exchange digital
assets as loan security across multiple platforms. These capabilities are not possible

2. with the regular DeFi since it allows data exchange only through specific protocols on
which a particular DeFi runs.
● Efficiency – The new cross-chain DeFi also allows users to perform micro-transfer
efficiently across multiple platforms. This is why many eCommerce and gaming brands
are adopting this technology.
● Inventory – Since cross-chain DeFi is extensible, you don’t need to worry about storing
large files. It is capable of extending its storage capacity. On the other hand, the
regular DeFi uses a single blockchain for “on-data” storage which can be expensive.
Bottom Line
The all-new cross-chain DeFi might be the new door to unlock various possibilities. With
businesses looking for ground-breaking technologies, this might be a great one to start with.
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FAQs
1. What is DeFi?
Decentralized Finance (DeFi) is a blockchain-based technology that facilitates peer-to-peer
banking services similar to that used by cryptocurrencies.
2. What is cross-chain DeFi?
Cross-chain technology enables a DeFi platform to exchange data, cryptocurrencies, and
other financial assets between many independent blockchains.
3. What technologies are used by the best blockchain developers?
The best blockchain developers use the latest robust technologies like Ethereum, Hyperledger
Fabric, IBM Blockchain, HydraChain, Ripple, IOTA, etc.