The Inter-Blockchain Communication (IBC) protocol is the connective tissue of the Cosmos ecosystem, allowing independent blockchains ("zones") to transfer tokens and data in a trustless manner – much like the internet's TCP/IP enables communication between computers. As Cosmos adoption has grown, so have the scalability challenges of IBC. In 2024, Cosmos faces the question of how to increase the throughput and efficiency of interchain communication (i.e., "interchain bandwidth") while preserving security and decentralization.

Current challenges include reliance on third-party relayers, potential congestion and latency during peak usage, and the need to maintain trust-minimized operations. Fortunately, several IBC scaling solutions are on the horizon or emerging: from the Skip protocol's innovations, to packet aggregation in new IBC versions, to rate limiting and better relayer incentives. In this article, we'll explore these approaches and how they aim to strengthen Cosmos's cross-chain future without compromising its core principles.

Challenges with IBC Scalability Today

IBC has proven effective and secure, but some bottlenecks have appeared as usage grows:

Packet Relaying Dependence

IBC relies on off-chain relayer processes to ferry packets between chains. These relayers listen for IBC messages on one chain and submit them to the counterparty chain. The system is trustless (anyone can run a relayer), but in practice a few relayers handle most traffic. If they slow down or go offline, IBC transfers get delayed or stuck.

Moreover, users currently depend on relayers because they often can't relay their own transfers easily – to do so requires having the destination chain's fee token, which users may not possess. This reliance can create friction and centralization pressure (a small set of relayers becomes critical infrastructure).

Congestion and Throughput Limits

Each IBC packet is essentially an on-chain transaction on two chains (send and receive). During periods of high activity (e.g., when many users transfer tokens after an airdrop or during market volatility), IBC can become backlogged. If one chain's blocks are full, IBC packets may queue up, causing delays.

Also, IBC has historically processed packets mostly one-by-one per transaction; there hasn't been a native concept of bundling multiple transfers together. This means overhead for every single transfer, limiting total throughput. For example, sending 100 tokens individually creates 100 separate IBC send txs and 100 receive txs on the other side. This could be more efficient.

Latency

IBC transactions involve a multi-step handshake: a packet send on Chain A, then a relay to Chain B, then an acknowledgment back to Chain A. Each step waits for block confirmations. In the best case (with fast relayers and short block times) a token transfer might complete in, say, 6–7 seconds (two block intervals).

But if block times are longer (some chains have 5–6s blocks) or relayers aren't instant, it could take longer (tens of seconds, even minutes). For certain applications – cross-chain trading, interchain accounts controlling contracts – this latency can be a UX hurdle. Reducing the number of steps or combining them could cut latency.

Maintaining Trustlessness

Any scaling solution must preserve IBC's security model – light-client verification on each chain (each chain runs a light client of the other to verify proofs) and permissionless relaying. Solutions that introduce trusted intermediaries or require federated validators would undermine the trust-minimized nature. Thus, Cosmos is looking for in-protocol improvements that don't sacrifice decentralization.

Skip Protocol and Optimized Relaying

Skip Protocol emerged originally as a Cosmos MEV (Maximal Extractable Value) solution, but some of its technology has direct implications for IBC performance and user experience. One offering was Skip Connect, which aimed to simplify and enhance relaying.

Skip Connect explored using Cosmos validators themselves to perform certain relaying tasks in-protocol, instead of waiting for external relayer processes. In essence, a validator proposing a block on Chain B could directly include an IBC packet from Chain A (which it has access to via an off-chain process) and pay itself the relayer fee attached to that packet.

This approach addresses two problems:

1. 1.It incentivizes relaying by rewarding block proposers with fees (no more relying purely on altruism or out-of-band payments)
2. 2.It can solve the "fee token on destination" issue by having the validator handle fee conversion

Skip's design leveraged ICS-29, the IBC fee payment standard where users can attach optional fees for relayers. A user could initiate a transfer on Chain A and offer a fee in, say, ATOM; the Skip-enabled validator on Chain B picks up the packet, relays it to Chain B, and claims the ATOM fee on Chain A (using a mechanism to convert it to a valid fee on Chain B behind the scenes).

To the user, this looks like a near "gasless" IBC transfer – they didn't need to pre-fund gas on the destination chain, and the packet likely gets delivered faster by an incentivized validator.

While Skip Connect as a service was discontinued in early 2025 (the code was open-sourced for others to use), the concepts it proved are influencing IBC development. The key takeaway is the importance of relayer incentive alignment.

Packet Aggregation and IBC v2 Efficiency

Perhaps the most significant upcoming leap in IBC scalability is the redesign of the protocol itself in the next version (unofficially referred to as IBC v2 or codename "IBC Eureka"). One of the headline features is the introduction of a more flexible packet format with payload aggregation.

In IBC classic, each packet contains one payload (e.g., one token transfer or one interchain account message). IBC v2 will allow a single packet to contain multiple payloads – potentially even of different application types – that execute together. In simpler terms, this is batching at the protocol level.

For example, today if you wanted to send 3 different tokens from Chain A to Chain B simultaneously, that would be 3 separate IBC transfers (and 3 separate acknowledgments back). With packet aggregation, it could be 1 aggregated packet carrying all 3 transfers, and that packet would be verified and delivered as one unit. This reduces overhead (less duplicate proof data, fewer transactions) and thus increases throughput.

It's not just about multiple token transfers either; the design envisions combining different application actions. Down the line, a single IBC transaction could do something like "send token X and call a contract on the remote chain" in one go, improving atomicity and efficiency for cross-chain dApps.

The Cosmos team has demonstrated this with benchmarks. Sending IBC packets in batches significantly improves performance compared to one-by-one sends. In February 2025 tests, the Solidity implementation of IBC v2 (for Ethereum) showed that batching could cut costs and increase throughput by an order of magnitude in some cases.

Another aspect of IBC v2's efficiency improvements is a streamlined connection handshake. Currently, setting up a new IBC connection between two chains involves a multi-step handshake of clients, connections, and channels. IBC v2 collapses much of this into a simpler "router" abstraction, allowing chains to establish connections more quickly without the lengthy 4-step handshakes of the past.

Rate Limiting for Security and Stability

Not all "scaling" is about going faster – sometimes it's about controlling the flow to ensure safety. Enter IBC rate limiting. This feature is essentially a circuit-breaker or throttle that Cosmos chains (optionally) implement to cap the rate of IBC token outflows. While primarily a security tool, it has implications for maintaining trust in high-volume interchain activity.

Why rate limits? They were introduced after some high-profile exploits in 2022 (like the BSC bridge hack and the Dragonberry vulnerability in Cosmos's IAVL library) highlighted risks of rapid unlimited outflows. Osmosis developers pioneered an IBC rate limit module in late 2022, which became an interchain standard many chains adopted.

In simple terms, a chain can set a rule like: "At most X tokens (or $Y worth of tokens) can leave via IBC per 24 hours." If a hack or exploit tries to drain funds, the rate limit kicks in once the threshold is reached, halting further outflows until the next time window.

This doesn't prevent the hack entirely, but dramatically limits the damage – for example, if a chain limited outflows to $10M/day, even a would-be $100M theft would be stopped 90% short, containing the loss to $10M.

From a scalability perspective, rate limits help maintain trust and stability in an interoperable world. Users and other chains can be confident that even under duress, a chain can't be completely emptied out in minutes. This encourages more cross-chain activity (greater adoption) because the worst-case scenarios are mitigated.

Incentivizing Relayers and Reducing Latency

We touched on relayer incentives with Skip, but it's worth emphasizing how crucial broader relayer infrastructure improvements are for IBC's future. Currently, most relayers are run by a handful of service providers and volunteers. As IBC traffic grows (imagine dozens of major consumer chains all sending constant interchain messages), a more robust network of relayers is needed.

Several approaches are being considered:

• •On-Chain Fee Markets for Relaying: ICS-29 is the standard that allows users to attach fees to IBC packets. Wider adoption of this standard could create an actual market for relayers – multiple relayers might compete to deliver a packet to claim the fee.
• •Validator as Relayer: Similar to Skip's idea, incorporating relayer duties into validator responsibilities is being explored. Because validators already produce blocks and earn rewards, folding IBC packet relaying into their role (with compensation) could leverage the existing decentralized validator set.
• •Infrastructure and Monitoring: Simply improving the tooling for relayers can indirectly scale IBC. Better monitoring and easier-to-run relayer software will allow more participants to join.

Outlook: Scaling Interchain Bandwidth without Centralization

All the solutions discussed – Skip protocol enhancements, packet aggregation in IBC v2, rate limiting, and relayer incentives – share a common theme: they improve capacity or security without introducing trusted third parties. Cosmos is committed to an open, decentralized interchain, so rather than relying on a few "super-relayers" or a centralized bridge, the focus is on protocol-level changes and market mechanisms that preserve trustlessness.

In the near future, we can expect Cosmos chains to handle far more cross-chain transactions per second, thanks to batching and optimized clients. For users, this might manifest as instant swaps across chains, more complex cross-chain dApps (like a single click to trade an Ethereum NFT for an Osmosis LP token via multiple hops), and generally snappier bridging of assets.

The "interchain bandwidth" – meaning how much data/value can flow through IBC in a given time – will significantly increase as v2 is adopted. And "interchain trust" will also increase, because of safety nets like rate limits and the continued absence of giant honeypot bridges (IBC's light client model means no custodians holding everyone's funds).

Crucially, these advancements don't come at the cost of decentralization. Cosmos will still rely on independent chains and validators verifying each other's proofs. Relayers, even if incentivized, remain permissionless actors (anyone can spin up a relayer and compete). No federated committee or multi-sig is taking over the job; it's simply becoming more efficient and attractive for participants to engage.

In conclusion, the future of Cosmos interoperability is one where IBC is faster, more efficient, and even more secure. Innovations like those from Skip and the IBC core devs are solving the pain points of early IBC usage. As these solutions roll out, Cosmos is poised to grow its interchain economy without breaking its core principles.