Smashing silos with interoperability
Alex Stoicescu
Oct 17, 2024
8 min.
If you’ve spent time around crypto, you’ve probably heard the term "interoperability" and how it can be the next big thing. And let’s be real. It is. Without it, we're stuck with fragmented systems, siloed data, and a future where innovation stops. But with interoperability? We’re discussing seamless integration, increased efficiency, and a world where blockchain fulfills its true decentralized potential.
Captain Interoperability smashing silos
Let's leave behind the jargon and understand why interoperability is not just a buzzword but an actual game-changer for the future of Web3. But first, a quick detour through the history of interoperability, both in the broader tech industry and the blockchain scene.
A brief overview of interoperability
Interoperability might sound boring, but it's been the secret behind some of tech’s biggest revolutions. Back then, it was about getting different kinds of computers and software to stop being so territorial. Picture the 80s and 90s: Apple and Microsoft are in their epic battle, each trying to lock you into their walled gardens. Got a file on a Mac? Good luck opening that on a PC!
Then came the Internet in the late 90s, and suddenly, we needed everything to connect - computers, software, you name it. That’s where protocols like HTTP and APIs came into play. These standards made the Internet possible and turned it into the expansive, interconnected behemoth we can’t live without today.
Brad Garlinghouse, CEO of Ripple, once said, “Interoperability will be the fabric that ties the Internet of Value together.” Whether we’re talking about blockchain, the web, applications, or any other tech, ensuring different systems can talk to each other makes the whole thing work.
From Web2 to Web3: interoperability in action
The transition from Web2 to Web3 brings new promises, especially regarding ownership and interoperability. But before diving into the technical details, let’s reflect on why interoperability at the application level matters.
In Web2, interoperability between applications was a game-changer. Think about your smartphone: apps can share data and functionalities through APIs. You can snap a photo and instantly share it on social media, send it via messaging apps, or edit it in another app-all without manually moving files. This interconnectedness is possible because APIs enable seamless communication between applications.
However, in Web3, we’re still far from achieving that level of frictionless interaction. While blockchain platforms have focused on interoperability between chains, the real challenge is ensuring that apps can interact with each other effectively. Without this, we risk having a fragmented landscape where each app operates in isolation, limiting innovation and user experience.
Interoperability in Web3
WEF in collaboration with Deloitte, Inclusive Deployment of Blockchain for Supply Chains, April 2020
In the blockchain world of today, we’re seeing an old problem come back with a modern twist: interoperability. Blockchains were supposed to be game-changers, breaking away from those old-school, closed systems. But funny enough, early blockchains like Bitcoin were just as isolated. They couldn’t talk to each other, and moving assets or data between them was nearly impossible without involving a trusted middleman, which goes against the idea of decentralization. Now that the blockchain space has grown, it’s clear that making these networks work together smoothly isn’t just a nice-to-have anymore but a must.
The interoperability layers
Rafael Belchior, Jan Süßenguth, Qi Feng, et al. A Brief History of Blockchain Interoperability. TechRxiv. April 02, 2024.
Alright, let’s break it down a bit more. Interoperability isn’t just one big monolithic thing. It’s made up of different layers, each doing its job.
Technical layer: This is where the essentials happen: data formats, communication protocols, and the “bits and bytes” that make the tech work. It’s like the plumbing under your house; you don’t see it, but nothing works without it!
Syntactic layer: This layer ensures that when data moves from one place to another, it’s in a format both sides can understand. It’s about getting the structure right so the info isn’t lost in translation.
Semantic layer: This is where things get interesting. The semantic layer is all about ensuring the systems exchange data and understand it. In blockchain, this is where bridges and protocols make cross-chain transactions not just possible but smooth.
Application layer: Several applications (e.g., bridges) can be built on the semantic layer.
Organizational layer: Moving up the stack, this layer is about getting everyone to agree on how to do things, ranging from governance and policies to organizational development. It’s not just about the tech; it’s about people and organizations playing nice together.
Legal layer: The legal layer ensures that when different systems talk to each other, they stay within the bounds of laws and regulations. It’s the layer that keeps everything legit.
Breaking interoperability into these layers isn’t just some academic exercise. It keeps things from getting too complicated and lets developers focus on what matters: building cool stuff that works.
Most of what we see today, including the tools from Request Network, operates in the semantic layer. That’s where the magic happens, where different applications and bridges get built on top of asset-transfer protocols. The IETF (Internet Engineering Task Force) is working on standards like the Secure Asset Transfer Protocol, which spans both the semantic and organizational layers, ensuring digital assets can move smoothly and securely between different entities.
The problem with current Web3 applications
Most Web3 applications today function like isolated islands. These apps don’t communicate well with one another, which leads to inefficiencies and duplicative efforts. Users must often manually manage multiple platforms to move assets or data between apps. For example, a user might issue an invoice using one application but then struggle to track or process the payment in another app.
This fragmentation creates friction for both businesses and users. Businesses face high integration costs, while users struggle to move data and assets seamlessly across apps. As a result, Web3 hasn't yet delivered on its promise of a connected, decentralized ecosystem.
Web3’s missing ingredient: application interoperability
The future of Web3 lies in blockchain and app interoperability. True interoperability means decentralized applications can seamlessly exchange data and functionality, enabling new, richer user experiences across multiple platforms.
For instance, imagine a decentralized exchange (DEX) communicating directly with a lending protocol. Users could trade assets and then immediately use those assets as collateral on another platform without manually moving tokens between apps. This level of fluid interaction is the future that Request Network is building towards - a financial ecosystem where applications interoperate smoothly.
Request Network: enabling app interoperability
Request Network enables interoperability between decentralized applications, particularly in the financial sector. Its core innovation lies in its ability to simplify the flow of financial data between applications. This is achieved through its set of flexible, easy-to-integrate templates that cater to various use cases, making it easier for developers to build interoperable apps without reinventing the wheel.
Here’s how these templates contribute to app interoperability:
Request Invoicing Template: One of the core templates Request Network provides is Request Invoicing. This template allows apps to integrate invoicing functionality seamlessly. For example, a decentralized marketplace can use this template to enable vendors to automatically generate invoices for sales made on the platform. The beauty of the Request Invoicing template is that the invoice data is stored on the Request Network, allowing it to be accessed by other applications like accounting or tax software, no matter which blockchain or platform the vendor operates on.
Use Case: A freelancer who works on multiple platforms - a decentralized gig platform or a traditional freelancing site - can issue invoices through Request Invoicing. These invoices can be automatically shared with the freelancer's accounting app to track their finances, ensuring the data flows between the different applications without any manual input.
Request Checkout Template: The Request Checkout template enables businesses to integrate crypto payments easily into their websites or apps. More than just a payment widget, Request Checkout ensures that the payment data is stored on the decentralized Request Network, where it becomes interoperable. For instance, once a payment is completed, this data can be automatically transferred to another application that handles post-transaction processes, such as issuing receipts or generating reports for tax filings.
Use Case: Imagine an e-commerce store built on Ethereum. By integrating Request Checkout, the store owner can accept payments in multiple cryptocurrencies without needing to manage different payment gateways. Once a customer completes a payment, the transaction details automatically sync with the store’s invoicing system, streamlining the payment-to-invoice workflow.
Request Scan: Request Scan is an additional tool that showcases the power of interoperability on the Request Network. While not a template, it acts as a proof of concept for how different apps can pull data from Request Network to display transaction histories, invoices, and payments. It shows how any accounting or auditing app can integrate seamlessly, leveraging the data stored on Request’s decentralized financial database.
Use Case: A user who runs multiple decentralized applications for different financial operations-such as invoicing, payment tracking, and tax management-can use Request Scan to view and audit all transactions in one place. This ensures that all app financial activities are visible in a unified interface, reducing the need for complex integrations.
Book a demo call with us to find out how Request Network's financial infrastructure can enable interoperability for your dApp.
Interoperability in other industries and what we can learn from them
Other industries have dealt with interoperability for many years, and we can learn much from them.
Take telecom, for example. Back in the day, every mobile network was its little kingdom. If you were on one network, talking to someone on a different one was a hassle (CDMA, anybody?). The development of GSM in the 90s changed all that. It created a global standard, so your phone worked regardless of where or what network you used. That kind of interoperability didn’t just make life easier - it helped mobile phones explode into the global phenomenon they are today.
Then there’s finance. Before modern payment networks, moving money across borders was a nightmare. Enter SWIFT in the 70s, a standardized messaging system that lets banks talk to each other securely. It turned the global economy into the rather well-oiled machine we take for granted today.
A real-world example demonstrated at ETHWarsaw 2024 involved creating a Request Checkout widget to sell VIP tickets for the event. Users could choose their preferred crypto, pay via a wallet, and instantly see their purchase data reflected in Request Invoicing. This seamless flow between applications is the future of Web3 finance.
The point? When systems or applications can communicate and work together, everything gets better. And blockchain is no different. Interoperability is what’s going to take it from a niche technology to something useful for everyone.
What makes Request Network stand out?
Request Network lets users send and receive payments across different blockchains, but the real magic is how we make these interactions a breeze.
Making payments user-friendly
Payments have always been troublesome. With a unified API that handles the hard stuff, developers can plug in and go. No more headaches, no more friction - just smooth, easy payments.
Security that doesn’t cut corners
Interoperability is great but useless if it’s not secure. Transactions can be quite problematic if they’re not done right. Request Network gets that. We use each blockchain's native security protocols and some cryptographic magic to ensure everything stays safe and sound.
Fueling DeFi’s wild expansion
DeFi is where the action is in Web3, and interoperability is its secret weapon. Request Network’s tools are helping DeFi platforms connect across multiple blockchains, making the whole space more versatile and accessible. This means developers can build more ambitious projects without worrying about the tech, and it also means a smoother, more cohesive user experience.
Why interoperability matters now more than ever
In this attention-competitive industry called Web3, interoperability is not just a nice to have. It is imperative. This would be the thing that brings practical utility to these siloed blockchain projects. Request Network is doing the heavy lifting, cutting apart silos and bringing everything together. We’re laying the groundwork for a more connected, efficient Web3. Further technological progress will lead to a more complex future of numerous blockchain applications.
This is not just the fabled future of finance - it's also an early iteration of a more secure, egalitarian internet. Think of the dream: a decentralized world where applications on different blockchains talk to each other as seamlessly as your smartphone talks with the cloud. It is a future worth fighting for.
ABOUT REQUEST NETWORK
The Request Network Foundation’s mission is to re-invent accounting and finance by creating a decentralized network of interoperable apps that promotes transparency and real-time reporting.
We inspire and educate developers, partners, and authorities to use Request Network and build an open-source, seamless, and interoperable financial ecosystem.
We’re building a network that connects businesses worldwide, giving them ways to do business at the speed of the internet.
Be a part of tomorrow’s financial revolution.
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