tBTC has launched (for the second time) to provide a trustless bridge between Bitcoin and Ethereum
Thesis, the blockchain development company behind Keep Network, has previously released tBTC with little success. However, they didn’t give up and just continued to release a new version of tBTC.
What is tBTC? What benefits does it have for the market?
tBTC is Bitcoin tokenized in the Ethereum blockchain as an ERC20 token backed by the original Bitcoin. The initiative might seem like another one of the many projects that seek to bring Bitcoin into the smart contract chain. Still, the Thesis adds a new -and exciting- ingredients: decentralization.
Matt Luongo, the founder of Thesis, stated:
“As far as I know, this release is the first permissionless, censorship-resistant Bitcoin bridge on Ethereum. Anyone can mint $ tBTC by connecting to the Bitcoin and Ethereum chains, and no one can censor transactions or redemptions.”
This means users can rest assured that their money is not controlled or protected by a centralized organization.
In summary, tBitcoin is a Bitcoin token with the same philosophy as Bitcoin, with very similar features to Bitcoin, only it runs on Ethereum. Thus, concerns about funds centralization and the possibility of a third party exercising some censorship are addressed.
Vitalik Buterin pointed out as below:
I continue to be worried about the fact that these wrapped BTC bridges are trusted…..
I hope that they can all *at least* move to a decently sized multisig
— vitalik.eth (@VitalikButerin) August 17, 2020
The demand for Bitcoin tokens on Ethereum is high, especially considering the growing popularity of this blockchain after the DeFi boom. In wBTC alone, a centralized but popular tokenized version of BTC, there are more than 818 million dollars or 77860 BTCs locked up.
tBTC had a rough start. After its first release, a bug that led to introducing untested functions into the code led developers to pause the project when it was only two days old. The new version, which Luongo to as rc1, corrected this problem and added essential improvements over its predecessor:
4/ Regardless, the over-collateralized design of tBTC means that if all signers go offline tomorrow, $tBTC holders still have access to their funds- paid from the signers’ bonds.
— Matt Luongo (@mhluongo) September 22, 2020
Luongo and his team are optimistic and caution:
“To avoid possible damage, they decided to set up a supply cap system that will increase over time to reach the 3000 BTC enclosed.”
Also, Luongo assured that he would put his investment in the project to have more skin in the game.
On May 22, following the emergency shutdown of the first version, Thesis announced that tBTC would move to a release candidate cycle. The team behind tBTC believes that certain BTC holders would like to access DeFi but are waiting for a trustless path to do so. Another alternative to WBTC is renBTC, which has minted more than 20,000 BTC worth of ERC-20 tokens since launching in May.
- All $400 Million Of MicroStrategy Bitcoin Reserve Holdings Could Be Liquidated At Any Time, Especially On Saturday
- African Cryptocurrency Adoption Has Exploded In 2020, Prompting Fears Of A Heavy-Handed Regulatory Response