AppLayer-to-AppLayer Token Bridging

How native chains exchange tokens on AppLayer.

The same method for arbitrary data bridging is used for token bridging, but there are extra checkups to make sure that a given chain is not minting another chain's tokens.

Due to how the network was designed, when doing a cross-chain transaction we can only ensure that the data exists, not that it is valid in context. That breach allows a given chain to mint the native token of another chain, because the Chain Abstraction Network does not verify if the token is valid inside that network.

We avoid this problem by keeping a "token table", which is just a "spreadsheet" of chains and their external token balances. Of course, this doesn't include the given chain's own native token, since it can freely mint its own token itself and does its own internal validations to avoid invalid minting conditions.

For example, we have chains A, B, and C, each one with tokens of each other. The Chain Abstraction Network keeps track of:

• How many B's and C's exist on A

• How many A's and C's exist on B

• How many A's and B's exist on C

When bridging another chain's tokens, the Chain Abstraction Network checks if that chain has enough balance to do so. When bridging your own tokens, the Chain Abstraction Network only has to increase the balance at the target chain, since the exit transaction from your chain has to be included in one of your blocks, which means it has been verified and validated inside your own network, so there's no need to do it again from the outside.

This method of bridging follows mint/burn mechanisms.