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Inter-Blockchain Communication, or IBC, is a messaging protocol that connects two chains. It is not a bridge. The difference between messaging and bridging is why the Cosmos Tokenization Suite uses IBC. A bridge takes custody of an asset on one chain and issues a claim against it on another, introducing a third party that both chains have to trust. IBC does not take custody or issue a claim. It lets two chains verify each other directly and pass authenticated messages between them, so only the two chains are trusted. For a bank, direct verification makes interoperability compliant. A payment to a counterparty bank is a message between two digital ledgers, with each ledger governed by its institution’s policy. No central settlement vendor sits between them, and no intermediary holds the asset.

IBC documentation

Full protocol documentation, including light clients, connections, channels, and application development.

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Track record and governance

IBC has run in production for over five years with no protocol-level loss of funds. It has processed over 100 billion dollars in cross-ledger transfers, has been independently audited more than nine times by leading firms, and is supported in production across more than 100 networks spanning Hyperledger Besu, Ethereum, Solana, and Cosmos. The protocol is free and open source: no vendor, no license fee, and no token is required to use it. IBC is governed under the Linux Foundation Decentralized Trust, the Linux Foundation body that is also home to Hyperledger Besu. This means the protocol’s governance matches its design: open, neutral, and owned by no single vendor, including Cosmos.

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Why not a bridge

Most large losses in digital assets have come from bridges rather than from the chains they connect. Removing the intermediary removes that exposure: this is the difference between an arrangement a bank’s risk function can approve and one it cannot.

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How CTS uses it

IBC is how a bank’s digital ledger reaches anything outside itself:
  • Coordinating a payment with a counterparty bank’s tokenization infrastructure, including the clearing and compliance checks both sides require
  • Moving tokenized assets between networks
  • Reaching public networks, consortia networks, and other banks’ private networks
See Networks connectors for where this sits in the architecture.

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