logo

MakerDao launches Bitcoin on Ethereum blockchain

MakerDao launches Bitcoin on Ethereum blockchain

The prospect of Bitcoin on Ethereum blockchain has always fascinated the crypto fans. Now, MakerDao has achieved this feat by using a ‘Wrapped Bitcoin.’ The decentralized community, Maker Dao, has full authority over the MakerDao Protocol, and they have decided that a new collateral asset called ‘Wrapped Bitcoin’ (wBTC) is an ideal way to bring Bitcoin on Ethereum blockchain.

 

According to the announcement, the MakerDao protocol will now offer transactions between BTC and ETH using a wBTC, which is an ERC20 token. Such a setup will undoubtedly increase the liquidity quotient on the platform.

Adding Bitcoin on Ethereum blockchain has its advantages

Interestingly, Bitcoin is the fourth offering on the MakerDao DeFi platform. There are already three collateral asset categories in the ecosystem, namely USDT, ETH, and BAT. Traders are already transacting using these asset types. With the introduction of Bitcoin on Ethereum blockchain, the wBTC Maker Vaults would now be permitted to ensure appropriate Dai generation.

With the launch of BTC on ETH blockchain, liquidity crunch will be sorted to a great extent. The entry of wBTC is beneficial for the entire DeFi realm, including the decentralized exchanges.

Bringing Bitcoin on Ethereum blockchain a technical milestone

Adding Bitcoin on Ethereum blockchain wasn’t easy – both technically and policy-wise. Now, Bitcoin users will be creating a Dai using their wBTC to create a vault. Oasis Borrow will handle the duties of vault management. The five-step process involves CoinList registration, fulfilling the KYC requirements, wrapping Bitcoin to wBTC, undertaking transaction with wallet, and lastly, creating a wBTC vault to build a new DAI.

With the rise of DeFi, the entry of BTC was only a matter of time. Earlier, there were speculations whether or not BTC would enter the DeFi ecosystem. But with the launch of Bitcoin on Ethereum blockchain, all these doubts have been put to rest.

Gurpreet Thind

Gurpreet Thind

Gurpreet Thind is pursuing Masters in Electrical Engineering at University of Ottawa. His scholarly interests include IT, computer languages and cryptocurrencies. With a special interest in blockchain powered architectures, he seeks to explore the societal impact of digital currencies as finance of the future. He is passionate about learning new languages, cultures and social media.

Related News

Hot Stories

Blockchain industry has over 81 Million active users, reports show
Explained: 2 Important Ethereum priorities after The Merge
Kitsumon launches NFT land sale in partnership with top NFT and Gaming platforms
What lies ahead for Voyager Digital and its investors after FTX wins the purchase auction?
Dogecoin price analysis: DOGE peaks at $0.063, quickly tests $0.06  

Follow Us

Industry News

What lies ahead for Voyager Digital and its investors after FTX wins the purchase auction?
What is happening with Nexo?
FTT burn Vs. BNB burn Vs. Shiba burn
Was the Wintermute hack an inside job?
Watch: Inside the Walmart Metaverse 2022