Interoperability Is Not Solved

We are led to believe that interoperability is solved. However, there are three clear signals that point to the contrary. Interoperability is not working for builders or anyone working to deliver meaningful solutions on chain.

Distribution is still discriminatory (there are over 1445 EVM chains, but the largest interop protocol only has 150 integrated). Only 10% of the onchain world gets interop offered to them.
Infra determines standards that benefit infra - leading to the market remaining fragmented and interoperability being provider-centric rather than universal.
Apps, protocols, and asset issuers are second-class citizens - their distribution is determined by the service provider, and they must adapt to one-size-fits-all solutions. Rather than using interoperability to distribute their value, they act as a top-funnel for the interoperability protocol to generate fees.

All of these realities arise from a fundamental problem with the current mental model that we apply to interoperability:

Interop is built as a B2B solution, serving infrastructure (interop protocols and chains), not value generators (apps, protocols, and asset issuers).
In pursuit of a moat, walled gardens are built, where admission to the garden comes at an immense cost to chains and steep rent is charged from value generators. This prevents innovation and eliminates any agency for those who bring value and users onchain.
The reason for fragmentation is that interoperability providers build moats through vendor-locking standards, concentrating fees within their protocols - not a lack of technology.

This can be summed up in one sentence: “In the current mental model of interoperability, infrastructure dictates the terms to value generators”. However, historically, we have seen that true adoption of any technology comes when value generators are able to bend infrastructure to their needs. Once the power dynamics switch, we will unlock a new chapter in the industry.

Why is it important to break this mental model for interoperability?:

Users and value flow onchain because of value generators, not infrastructure. Users want to acquire stablecoins to move funds and access dollars, place bets on Polymarket, and speculate on Pump. Users do not and should not care about what chain or interoperability protocol allows them to consume and access what they want.

For value generators to flourish, they need to be able to:

Optimise their offering to the requirements of their users
Own and determine their distribution according to their needs
Retain control and sovereignty

This will lead to value generators capturing more value and becoming more sovereign and defensible as they are the ones in control. This, in turn, leads to more long-term strategies (as defensibility makes them into assets), higher investment (as they are becoming more valuable), and therefore more innovation.

This ultimately culminates in consumers receiving a better offering and the market expanding.

So what should the solution look like?:

Distribution is commoditised - walled gardens fall, interoperability becomes universal. Every chain is connected, and users are no longer hidden within the walls of interoperability protocols and favoured chains.
There must be no infrastructure vendor locks; infrastructure must be modular, upgradable, and optimisable for any value generator with any use case.
Transaction processing and propagation must be trustless, where there is no single party that has de facto control over the transaction.

To put it simply: “There is no place for kings in interoperability”

It is existentially important for our industry to change the mental model when it comes to interoperability. If we want to truly solve the problem of interoperability, we mustn't view it as a service that is provided by a company/network. Interoperability must be treated as an open and neutral layer that anyone can build on, rather than a product owned and controlled by a single provider.

The internet is not a product that belongs to an Internet Service Provider, so why are we viewing cross-chain interoperability as such?

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