BTC Proxy: Is This The Bitcoin Bridge We Are Waiting For?
Have you ever realized that you can earn more than 100% APR (Annual Profit Yield) from your Bitcoin? I bet you don’t know. By the time that you read this article till the end, you will learn how to bridge your Bitcoin, how you can tokenize it securely, and earn incredible passive income with it.
Introduction
Some years back, the only way to bridge Bitcoin and tokenize it is by sending BTC to centralized exchanges and withdrawing it to the Ethereum blockchain. In this situation, a lot of things can happen to your Bitcoin;
- The exchange may question your withdrawal and restrict your account
- The human need to approve your withdrawal when you initiate it, thereby increasing your risks.
- The exchange could be hacked before you can withdraw your BTC from the exchange to the Ethereum blockchain
- Price slippage
This is a great risk of counterparty and theft, and anything can happen. This kind of approach feels like manual labor, and the industry is ought to have out-grown it.
Bitcoin dominance is reducing, yet it is the biggest crypto in terms of trading volume and market capitalization. It is disappointing that we have many decentralized finance protocols but none is focusing on how to bridge the world’s first and most popular blockchain with the rest of EVMs (Ethereum Virtual Machines) like Ethereum, Polygon, Binance Smart Chain, and so on.
Bitcoin is too big to be ignored in Defi (Decentralized Finance).
Current Circulation Supply of Bitcoin
According to information provided by coinmarketcap website, there exist more than 19,000,000 Bitcoin currently in circulation. But data on Bitcoin.com shows that less than 3,000,000 Bitcoin are sitting on exchanges. Only about 16% of the Bitcoin supply is on exchanges.
What does it mean?
It means that retail and institutions have seen Bitcoin as SoV (Store of Value), and they prefer to keep it safely in their private wallets. More holders believe that Bitcoin is undervalued at the moment and it is safe to keep it for future gains.
Not your private keys, not your crypto.
Also, after the Mt. Gox exchange hack, there is a common narrative that centralized exchanges are not to be trusted, and no sane individual should have a significant amount of their crypto on these platforms.
Can’t read the entire article? Watch the video…
The Problem of Existing Defi Protocols
Today, most tokens are paired with the native coin of the blockchain on which the tokens were created. For instance, most tokens are paired with Eth on Uniswap and other DEXs (Decentralized Exchanges) that are powered by the Ethereum blockchain. The same thing applies to Polygon, Binance Smart Chain, and Terra.
There is low Bitcoin liquidity on exchanges and protocols if we compare it with the amount of Bitcoin in circulation. Why?
- The interest rate on Bitcoin staking and Bitcoin farming is not encouraging. When liquidity is provided with Bitcoin on exchanges, the APR is between 3–8%.
- Most lending protocols offer ridiculous yields for Bitcoin deposits
- Security concerns, because there are no true decentralized means of tokenizing Bitcoin directly from the Bitcoin blockchain to EVM compatible blockchains
The Core Mission of BTC Proxy Protocol
Bringing Bitcoin liquidity to Ethereum and Polygon is vital to having a robust ecosystem, the protocol will help in facilitating this cross-chain transaction with the help of the BTC Proxy smart contract.
The flexibility of liquidity is at the core mission of BTC Proxy, this allows users to move their BTC to and from Ethereum/Polygon via the decentralized bridge.
Financial freedom becomes easy when users leverage the fact that an idle BTC in their private wallets could earn more than 100% APR by minting a BTCpx token.
How BTC Proxy Protocol Works
It works similarly to other bridges, users are required to have metamask chrome extension on their PC, then connect their wallet to the BTC proxy. The next stage is to deposit BTC from a private wallet into the contract and use it to mint the BTCpx token at 1:1. By depositing 10 BTC, approximately 10 BTCpx can be minted after paying a 0.1% minting fee.
Minted BTCpx can be supplied to the Bond or Staked for interest which is paid with a PRXY token. Users may also auto compound the PRXY token for 2000% APR.
Of course, the maximum supply of PRXY is 21,000,000. Same as Bitcoin maximum supply. Over a while, emission of PRXY will continue to decline and token emission will be slowed down.
Comparison with Other Crypto Projects: BTC Proxy Protocol Versus Symbiosis Protocol
Right now, Symbiosis is gaining some traction in the Defi space, it allows cross-chain swap between Ethereum, Polygon, and Binance Smart Chain. The ecosystem is growing steadily because cross-chain liquidity is now possible.
But here is the challenge, Symbiosis is not paying attention to the most dominant blockchain in terms of liquidity and market capitalization.
There is no way symbiosis could bridge EVMs with the Bitcoin blockchain. Bridging between EVMs has not truly solved the liquidity problem.
BTC Proxy is a game-changer because it has uniquely bridged Bitcoin-EVM by making use of secured custody that allows seamless tokenization of Bitcoin. Users can use BTC to mint BTCpx or redeem their BTC at any time.
BTC Proxy Protocol’s Competitive Advantage
Easy Redeeming and Burning: Once you have a web3 browser like metamask, you are good to go. Simply connect your wallet with the right network (Ethereum or Polygon), and you can redeem and burn BTC for BTCpx at 1:1. Note: you will pay a small fee as a transaction fee.
Minting: It is pretty much easy to mint BTCpx once you transfer your BTC from the Bitcoin blockchain to the Ethereum network.
Secured Custody: The ecosystem relies on trusted custodians, this is a 3rd party that which Bitcoin is entrusted. There is a secured integration through API that interacts with the protocol. When you transfer your digital assets, you are technically interacting with the custodians’ vault.
BTC Proxy Use Cases
Treasury Bond & Auto-compounding: Users can easily claim and stake PRXY tokens with a click function to benefit from compound staking. The compound interest formula should be one of the 10 wonders of the world. Users may earn up to 2,000% APR on staked PRXY tokens, and this is done via treasury bond.
Bitcoin Farming: This is an anticipated feature that I am personally interested in, as it will allow the investors to maximize their BTCpx. It is coming soon….
To Wrap It Up
If you have read this crypto review article to this point, you are now aware that there is a better utility for your Bitcoin, and you should not allow it to be idle. Every sane Bitcoiner wants to earn passive income, but they have no clue on how to go about it.
BTC Proxy Defi Protocol has created a win-win strategy that rewards you for helping the crypto industry to increase Bitcoin liquidity on Ethereum and Polygon blockchain.
We are living in a very interesting time right now, and this bridge will go a long way in increasing the amount of Bitcoin on exchanges. The status quo is about to change for good.
For more inquiries about BTC Proxy, and to keep a tab on future updates and releases, use the links below.
Website, Whitepaper, Twitter, Medium, Discord Server, and Telegram Community.
Also, let me know your thought about this decentralized finance protocol in the comment box.
About the Author
Ojeniyi Ayobami Abimbola has been trading cryptocurrency since 2015, and he is a blockchain content creator and a crypto coach at Cryptoniche. You can connect with him on: https://t.me/cryptoniche_hangout
Username: autofreak
