Wormhole cross-chain native token transfer functionality

Jafar224

On February 29th, the cross-chain messaging platform Wormhole introduced the Native Token Transfer (NTT) feature to preserve token characteristics and address the issue of liquidity fragmentation across different blockchains. Traditional cross-chain token transfers often require the use of token bridges, employing methods such as "locking and minting" or "burning and minting." This process involves locking native assets in a smart contract on one chain and then swapping them for synthetic versions on another chain.

However, Wormhole's NTT feature allows the protocol to deploy its standard tokens natively on multiple blockchains and facilitates the transfer between these standard deployments using an interoperability layer. This enables the direct transfer of native tokens without the need to convert them into synthetic assets. In contrast to wrapped assets, native token transfers ensure that projects maintain ownership, upgradability, and customizability of their tokens across different blockchains. This approach allows tokens to retain their unique characteristics when moved to another chain and avoids liquidity fragmentation by transferring value rather than double computation.

Isha000

I haven't used these features before.

Samiksha

This feature is quite powerful.