cryptoblockchain

Imagine LEGO, where each protocol in crypto is like a separate cube, and composability is the ability to assemble something new and powerful from those cubes.

▪️ Protocol compatibility is the ability for different applications and protocols to interoperate seamlessly with each other, allowing blocks to be combined to create new features.

In Web3, this means that one protocol can easily interact with another protocol, using its functions as its own. For example:

🔷 DEX uses liquidity from another pool
🔷 The credit protocol connects to oracles to evaluate collateral
🔷 NFT can be used as collateral in DeFi

It's like program code - you can quickly build complex systems without having to reinvent everything.

✅ Why it matters.
- Accelerates innovation
- Increases efficiency
- Creates more opportunities

➖
The more interoperable the protocols - the more opportunities for automation and new strategies.