Imagine a digital coin which will have the best features of the top two cryptocurrencies in the world today – Bitcoin and Ethereum. Kyber Network, Republic Protocol and Bitgo are doing precisely that with an announcement of a joint project which will be called Wrapped Bitcoin also known as is WBTC.
WBTC will involve the strengths of the two significant cryptocurrencies. It will take a direct backing of the mind-blowing price of Bitcoin and will launch on Etheruem’s Blockchain platform which is known for its dApps and smart contracts.
Initial liquidity will be pre minted by Kyber Protocol and Republic Protocol using existing Bitcoin so that users can use Atomic Swaps to exchange BTC to WBTC. BitGo will act as the primary custodian in charge of holding the BTC reserves. BitGo has an official status to operate as a regulated custody for institutional investors thanks to the South Dakota Division of Banking.
Through WBTC, Bitcoin and Ethereum will both benefit. Bitcoin will extend the use cases, by expanding into decentralized applications. Ethereum will be able to use Bitcoin seamlessly which will help many of the decentralized applications.
WBTC is already seen to be an instantaneous hit with decentralized exchanges and financial projects such as MakerDAO, Dharma, Airswap, IDEX, Compound, DDEX, Hydro Protocol, Set Protocol, and Prycto all committing to supporting it.
It is not the first time an effort has been taken to bring together Bitcoin and Ethreum. QTUM runs the Ethereum Virtual Machine on the Bitcoin network, and Rootstock is a project working on mirroring Ethereum’s smart contract featuring onto the Bitcoin network. So far both have not been as prosperous, and so it remains a doubt if WBTC will create the much-needed positivity in the cryptocurrency market.
Ethereum, in general, has been facing a lot of slack behind its Blockchain for dApps given its scalability issues. Hence Bitcoin being implemented into the Ethereum Blockchain may not be the best of ideas.
Image Source – Pexels
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