End Users Can Soon Transfer IBC Tokens between Terra and Cosmos.

End Users Can Soon Transfer IBC Tokens between Terra and Cosmos.
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Terra's Proposal for initiating the IBC on the Terra Network has passed, making IBC live on the mainnet. With this, the users can soon start to transfer the tokens between the Terra and the Cosmos ecosystem.

Proposal 28 to initiate IBC on Terra has passed, meaning that IBC is now live on the Terra mainnet 

Stay tuned for once the relayer channels are set up, and users can begin transferring tokens between Terra and the Cosmos ecosystem from Station.

~Twitter (@terra_money)

Note that IBC is known to be a standard practice to transfer the arbitrary message across the IBC-compatible chains, and Cosmos SDK has IBC as one of its native features.

Let us first understand IBC (Inter-Blockchain Communication)

In laymen language, Inter-Blockchain Communication is a protocol through which blockchains can talk to each other. It needs many crucial technical requirements to be met. IBC provides an end-to-end, reliable, authenticated and connection-oriented communication between off-chain protocols or heterogenous blockchains.

Using Inter-Blockchain communication, a wide variety of cross-chain applications can be developed. Thus, IBC is indeed a big deal in this space because it makes it easier to transfer data and tokens between unconnected blockchains.

IBC solves the scalability issues

Many of the popular blockchains face issues related to scalability, long transaction time and high gas fees. The reason behind that is the use of a mainframe approach by these blockchains. In simple words, they use complex time-sharing systems which are not scalable.

For instance, let’s just talk about Ethereum. Ethreum is the most prominent blockchain, and it faces congestion issues because everyone runs their programs here. This has led to the usage of Layer 1 and Layer 2 scalability solutions.

IBC connects the different blockchains, and this reduces the lack of interoperability of the blockchains. Different distributed systems can trustlessly interact with each other and transfer value, which is quite a different vision for interoperability.

What does it mean to Terra Network?

This Proposal enables the permissionless transfer of tokens across different chains. Also, it increases the possibilities of economic collaboration among other chains and projects.

For Terra Network, Inter-Blockchain Communication means that the inter-chain highways of DeFi with UST as the leading stablecoin, and exchange medium, will be more accessible. It has become much easier to port data availability proofs, and assets between IBC enabled chains in Cosmos and Terra.

Closing thoughts

Note that InterBlockchain communication opens up the world of possibilities where different blockchains can interoperate and transfer the value and services, and it doesn't even face any scaling issues. Cosmos ecosystem is the only one that builds and ships the technology of IBC. So, to sum up, it can rightly be said that this particular Proposal would mean a lot for Terra and will help in its growth.