Wormhole (W): what it is and how it works

What Wormhole (W) is

Wormhole is an interoperability protocol: it allows different blockchains, which are not natively compatible with one another, to exchange messages and value. It is not a blockchain, and calling it simply a bridge understates it: it is a communications infrastructure on which other applications build their own functions, without an interface of its own.

This page is for information purposes only: Wormhole is not supported by Young Platform and cannot be bought on the platform.

How the token works

W is a governance token: holders can vote on decisions relating to the protocol — for example adding or removing blockchains from the ecosystem, or changing fee parameters. It was distributed on 3 April 2024 through an airdrop to users who had used the platform, on the Solana blockchain.

Participation in governance carries no economic rights and no expectation of any return.

Origins

Given its complexity, the protocol is developed by several independent teams — including the Wormhole Foundation, Wormhole Labs and xLabs, alongside groups specialising in zero-knowledge cryptography. The project has raised 225 million dollars from sector investment funds, including Jump Crypto, Coinbase Ventures, Multicoin Capital, ParaFi and Dialectic.

What to consider

Protocols that connect different blockchains have historically been among the sector’s most targeted, because they concentrate the funds moving between networks at a single point. Wormhole is the best-known example: in February 2022 the protocol suffered an attack in which crypto-assets worth around 320 million dollars were taken, subsequently made good by one of the project’s investors. The architecture was later revised, but technical risk remains a structural feature of this category of protocol, not an episode that has been put behind it.

On top of that comes the volatility common to all crypto-assets. Past performance is not a guarantee of future results.