What is Bridge?

A bridge is a mechanism for moving an asset from one blockchain to another. Since a token on Ethereum cannot literally travel to Arbitrum, a bridge locks or burns the asset on the source chain and mints or releases an equivalent on the destination chain. Official rollup bridges do this with the rollup’s own contracts; third-party bridges do it with their own liquidity and their own security assumptions.

Bridges are where a lot of crypto has been lost. A bridge holds locked assets on one side and issues claims on them on the other, which makes it a concentrated target, and the largest exploits in the industry’s history have been bridge exploits. The official bridge of a rollup carries the rollup’s security; a third-party bridge carries whatever security that bridge has, and the token it hands you on the far side is only as good as the bridge that backs it.

From an accounting point of view a bridge is a transfer between your own addresses across chains, not a disposal, provided you receive the same asset on the other side. A tool that sees the outflow on one chain and the inflow on another without connecting them will invent a sale and a purchase, with a gain or loss that never occurred. Fees paid to the bridge are a cost of the transfer.

TrueHold reads both sides of a bridge from the same address and treats the move as a transfer, so bridging between Ethereum and its layer 2s does not distort PnL or the export.

Choosing a bridge is a security decision. The official bridge of a rollup is slow but inherits the rollup’s guarantees; a third-party bridge is fast and adds its own contracts, liquidity providers and multisig operators to the list of things you are trusting. For amounts that matter, slow and official is usually the right answer.