Blockchain Interoperability with Cross-chain Stablecoin Payments
Abstract
A Peer-to-peer payment system was one of the first proposed applications of
blockchain technology. Cryptocurrencies have instead been used as a
speculative investment. Stablecoins worth approximately 7 billion USD
circulate the cryptocurrency market today, presenting a good case for their
use in cryptocurrency payments [2]. Stablecoins have also been issued on a
variety of blockchains that operate balkanized from each other. Cross-chain
transfer between stablecoins is currently enabled by centralized middlemen.
The actions of putting stablecoin transfer in the hands of intermediaries is a
path towards centralization of control opposite to the decentralization
ideology of blockchains. The inter blockchain transfer between blockchains
should try to be as trustless as the intra-blockchain transfer. In this thesis, we
propose an alternative system for stablecoin transfer, specifically focused on
cross-chain stablecoin transfer between multiple blockchains using blockchain
interoperability. We then go on to implement a stablecoin transfer between
tokens that are based on two different blockchains by creating a
representation of the sender token on the receiver chain.