On April 3, 2023, the Dfinity Foundation, a improvement group behind the Internet Computer (ICP) community, introduced the launch of a native ICP token referred to as “chain-key bitcoin” or “ckBTC.” The bitcoin spinoff is backed 1:1 with the main cryptocurrency asset. On Monday, Dfinity detailed that the expertise “builds on the protocol-level integration with the Bitcoin network.”
Breaking Away from Custodians and Bridges: The Benefits of Chain-Key Bitcoin’s Smart Contract-Based System
On Twitter, the Dfinity Foundation introduced the complete launch of chain-key bitcoin, often known as ckBTC. “Proposals 115468, 115470 & 115473 have been adopted with flying colors,” the group defined. “Many thanks to all the [ICP] people who voted manually to make this happen.” According to a weblog submit, ckBTC is backed 1:1 with bitcoin (BTC), and the system operates with “centralized custodians, no bridges, and no traditional cloud providers.”
The ICP-based bitcoin spinoff is taken into account a “significant breakthrough in blockchain interoperability,” and the expertise is built-in with Bitcoin on the protocol degree, in keeping with the Dfinity weblog submit. The ckBTC system makes use of vaults referred to as canisters, which work with a sensible contract as a substitute of counting on a custodian or bridge. Essentially, to acquire ckBTC, a particular person must deposit BTC in trade for the ICP token, and withdrawals work the identical means when ckBTC is redeemed for actual bitcoin.
“Any canister can submit Bitcoin transactions to the Bitcoin network through ICP nodes, thanks to the direct protocol-level integration,” Dfinity explains. The firm insists that the expertise has important potential and may add to new use circumstances.
“[Native cross-chain technology] has the potential to enable new cross-chain capabilities and unleash a plethora of 100% on-chain services, such as multi-token transactions or multi-token wallet systems, which would greatly streamline the crypto user experience,” notes Dfinity’s weblog submit.
The announcement additional particulars that a number of ICP-based decentralized purposes (dapps), together with Openchat, Iclighthouse, Plethora Game, and Distrikt App, already assist ckBTC. While many blockchains have bitcoin spinoff tokens, most depend on bridges or custodians. For instance, the biggest bitcoin spinoff WBTC leverages the custodian Bitgo for minting and redemption functions.
What potential do you see within the native cross-chain expertise behind ckBTC, and the way do you suppose it’s going to affect the way forward for blockchain interoperability? Share your ideas about this topic within the feedback part beneath.
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