Very few connect decentralized finance (DeFi) to Bitcoin‘s blockchain, assuming that the whole system operates only on Ethereum.
But the truth is very different from what one might think and in fact Bitcoin (BTC) has several tokens that replicate its value on other protocols and blockchains.
Just to name a few, there are WBTC, pBTC, rBTC, renBTC, tBTC, imBTC, HBTC and many others, and the interesting thing is that many more are being created and several platforms are integrating them, such as Uniswap, Kyber, Bancor and soon Eidoo.
Recently, for example, thanks to Bancor, DeFi users are able to have liquidity pools dedicated to decentralized finance using bitcoin, where there is BTCDEFI, allowing to create their own pool thanks to Katana.
An important aspect of decentralized finance is the liquidity of assets.
WBTC is currently holding the lion’s share, with more than $7 million locked. These projects are pushing up the incidence curve in this sector to over $1 billion in recent months.
For example, the pBTC project by Provable Things, a British company that also launched pLTC and plans to launch pEOS and pTRX, has recently made a name for itself.
Obviously, most of the projects are based on the Ethereum blockchain and this can be both an advantage and a disadvantage: on the one hand, it’s a blockchain that has been going on for a long time and that almost everyone knows about, but on the other, a collapse or a criticality of the same would put in crisis all the applications based on it.
In addition, it should not be forgotten that the Ethereum blockchain has plans to evolve and move to a different protocol, the PoS (Proof of Stake) which should solve most of the negative aspects related to the current protocol, but which will involve a radical change and this could create many compatibility problems.
