On April 3, 2023, the Dfinity Foundation, the development team of the Internet Computing (ICP) Network, announced the launch of “chain-key bitcoin” or ” ckBTC”, an ICP native token offering. This bitcoin derivative is backed one-to-one with major cryptocurrency assets. On Monday, Dfinity detailed that the technology is “based on protocol-level integration with the Bitcoin network.”
Breaking away from custodians and bridges: the benefits of a system based on chain key bitcoin smart contracts
On Twitter, the Dfinity Foundationannounced the full releaseof Chain Key Bitcoin, also known as ckBTC.” On Propositions 115468 and 115470 {53} 115473 was adopted with great success,” he explained.” Thanks to all the [ICP] people who voted manually to make this happen.” According toblog post BTC), the system will operate with “no centralized administrator, no bridge, and no traditional cloud provider.”
According to a Dfinity blog post, the ICP-based bitcoin derivative is “a significant breakthrough in blockchain interoperability,” and the technology is integrated with bitcoin at the protocol level. ckBTC systems are not dependent on custodians or vaults called canisters that work in conjunction with smart contracts, rather than relying on bridges. Basically, to get ckBTC, you need to depositBTCin exchange for ICP tokens, and withdrawals work the same way as when ckBTC is exchanged for real bitcoin.
“Any canister can submit bitcoin transactions to the bitcoin network through ICP nodes with direct protocol-level integration.” . explains Dfinity. The company claims that the technology has great potential and can add new use cases.
“(Native cross-chain technology) has the potential to enable new cross-chain capabilities and unlock a number of 100% on-chain services, such as multi-token transactions and multi-token wallet systems that will greatly streamline the crypto user experience It will.” Dfinity’s blog post notes.
The announcement further details that several ICP-based decentralized applications (dapps) already support ckBTC, including Openchat, Iclighthouse, Plethora Game, Distrikt App cckBTC. Many blockchains hold bitcoin-derived tokens, most of which rely on bridges and custodians. For example, the largest bitcoin derivative WBTC leverages custodian Bitgo for minting and redemption purposes.
What do you see as the potential of the native cross-chain technology behind ckBTC and how do you think it will impact the future of blockchain interoperability? Share your thoughts on this topic in the comments section below.
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