With tBTC, a new token sees the light of day in the crypto world, embedding Bitcoin into the Ethereum Blockchain. The ERC-20 token is designed for DeFi applications and is intended to build a bridge between crypto ecosystems in the future.
The crypto company Thesis has announced the early introduction of the ERC-20 token tBTC. The token linked to Bitcoin runs on the Ethereum block chain and is intended to act as a connecting element between Bitcoin and Ethereum.
tBTC is about to have its final test
Users who wish to have a tBTC token created must first request a Bitcoin wallet address on the network. The system then selects a number of signers who generate a private and public key. The group of "signers" then confirms to the Ethereum Blockchain that the deposit has been processed. The tBTC tokens can then be generated and sent to the Bitcoin owner's Ethereum Wallet.
Protocol development has already reached the code-freeze phase. So the code base is in dry cloths, now the task is to test the system for possible errors under real network conditions. As project manager Matt Luongo confirmed to The Block, the Mainnet can be launched in March.
Token chains Bitcoin to Ethereum
The tBTC token is intended to allow Bitcoin holders to use the cryptographic currency on the Ethereum Blockchain. tBTC joins a series of tokens based on the Ethereum Blockchain and bound to Bitcoin, including Wrapped Bitcoin (WBTC), ImToken (imBTC) and Synthetix' sBTC. According to Luongo, these tokens have not yet mastered direct transfer between Bitcoin and Ethereum:
Bitcoiners want to be able to return to the Bitcoin Blockchain. For the asset to be considered valid and theirs, they must be able to pay it out without confidence, and a synthetic [Bitcoin] does not provide this.
According to Luongo, the token is also more transferable to side chains compared to its competitors. In addition, tBTC offers better security concepts than, for example, Blockstream's Liquid network, which has a central consortium of 23 crypto companies for the processing of transactions.
DeFi application of tBTC
The new token could also close a gap in the area of Decentralized Finance (DeFi). As the demand for Bitcoin secured loans increases, a number of crypto companies such as Blockfi, Compound, Genesis Global Trading and Blockchain.com have already developed solutions for the lending business with cryptocurrencies.
tBTC could provide another way for users to obtain loans deposited with cryptocurrencies. Luongo explained that some DeFi credit platforms have already agreed to integrate the token.
Posted from Crypto Mastermind Go to the original article