It will be updated as more information is determined and available. For Binance this reason, you can consider this page a work in progress. While bridge designs are now getting to a place where they are sufficiently planned out, there have not been too many used heavily in production.
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I highly recommend reading Nick Szabo’s two essays, "Origins of the Joint-Stock Company" and "The Birth of Insurance" for an in-depth look how this process occurred. Developing out of the rise of italian merchant class in Italy during the 11th century, banking evolved far beyond the meager protection of precious metals into financialization. Banks from their earliest origins have functioned quite autonomously of the state.
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For information on XCM, the native interoperability technology that allows parachains to communicate trustlessly, please see the dedicated cross consensus page on the Wiki. ecosystem compatible with external blockchains such as Bitcoin, Ethereum, or Tezos (among others).
And this was all thanks to the seditious revolution of banking. The Crown essentially invented war bonds to raise funds for the transformation of england into the naval superpower it would later become. This allowed for lenders to give cash bullion to the bank, who could then give a loan based upon a promise of repayment from the Crown in the future. As a private corporation, the BOE was given the sole power to issue bank notes in england on behalf of the crown.
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Conversely, ERC-20 tokens deposited back into the contract on side can free up Ether on main . Those who are already familiar with Ethereum may know of the now archived Parity Bridge and the efforts being made to connect PoA sidechains to the Ethereum mainnet. The Parity bridge is a combination of two smart contracts, one deployed on each chain, that allow for cross-chain transfers of value. As an example of usage, the initial Parity Bridge proof of concept connects two Ethereum chains, main and side . Ether deposited into the contract on main generates a balance denominated in ERC-20 tokens on side .
Higher-order protocols (like XCLAIM) can be used to bridge but should only be used when other options are not available. XCLAIM, in particular, requires any swappable asset to be backed by a collateral of higher value than the swappable assets, which adds additional overhead.
One of the dirty secrets of the bitcoin world is that we are still in the 11th century of online exchange. These issues continue to this day; however there are apparatuses that as groups of people we can use to defend against such issues: Banks. Coins, as all physical objects, are subject to physical theft, confiscation, swindling, fraud, and debauchment; but most of all, outright violence to seize it. Today bitcoiners are dealing with the classic issue that plagued humanity since at least the 7th century BC when the first piece of coinage were found.
Polkadot favors the latter bridge designs for its ecosystem. Bridge designs come in a variety of flavors ranging from centralised and trusted to more decentralised and trustless. Blockchain bridges are ways for two economically sovereign and technologically diverse chains to communicate with each other. However, there is nothing that blocks a development team from building and deploying the former. A cornerstone technology of blockchain interoperability is the blockchain bridge.
The Substrate instance can then be deployed to Polkadot either as a system-level parachain (native extension to the core Polkadot software) or as a community-operated parachain. Receiving messages on Polkadot from an external, non-parachain blockchain can be possible through a Substrate pallet.