Cardano Network Introduces Wrapped BTC Solution

Cardano network now embraces its own ‘Wrapped BTC’ solution

Wrapped BTC (WBTC) is a synthetic version of Bitcoin (BTC) that is represented by a token and built through a smart contract. It is backed by BTC deposited as collateral and is used in Decentralized Finances (DeFi) platforms. Recently, it was announced that Bitcoin-backed tokens can now be used on the Cardano (ADA) network. The Cardano network has been expanding its presence in DeFi since the launch of its native DeFi protocols earlier this year.

Main Breakdowns:

Wrapped BTC is a synthetic version of Bitcoin represented by a token.
The Cardano network now supports Bitcoin-backed tokens.
Cardano has been growing its presence in DeFi since early 2022.
AnetaBTC’s protocol for Wrapped BTC is currently in the experimental phase.
AnetaBTC plans to move towards decentralization with future versions of the protocol.

AnetaBTC’s protocol for Wrapped BTC is currently in its ‘v1’ phase, which involves full custody and governance by the protocol creators. However, the project aims to move towards decentralization with future versions of the protocol. In ‘v2’, trusted third parties known as “guardians” will be introduced, and in ‘v3’, anyone will be able to run a vault by providing collateral. This final phase is inspired by the Xclaim whitepaper and aims to ensure the security of the protocol.

It is important for users to be aware of the risks and security assumptions associated with using the AnetaBTC protocol. Currently, only a small amount of BTC has been wrapped through their bridge. However, the project has the potential for growth and adoption in the Cardano DeFi ecosystem.

In conclusion, the Cardano network now supports Wrapped BTC, providing users with the opportunity to use Bitcoin-backed tokens in the Cardano DeFi ecosystem. While the protocol is still in its experimental phase, there are plans to further decentralize the system in future versions. The introduction of Wrapped BTC on Cardano expands the options available for crypto users and contributes to the growth of the Cardano DeFi ecosystem.

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