Avalanche Bridge promises to bring BTC to its DeFi ecosystem

Charlie Taylor

Avalanche Bridge is a tool created by Ava Labs to facilitate secure cross-chain operations between Avalanche and other blockchains and is currently the most widely used Ethereum bridge on the market. Avalanche Bridge will now add native support for Bitcoin, expanding opportunities for BTC in AVAX’s DeFi ecosystem. Avalanche Bridge will expand support for the Bitcoin network, allowing bitcoiners to securely transfer their BTC to AVAX’s blockchain and use it in Avalanche’s DeFi ecosystem, which currently has $11.68 billion in total amount blocked (TVL).Avalanche TVL at $11.68 billionSource: After the launch, which is expected in Q2, Bitcoin will join Ethereum as supported networks on the Avalanche Bridge. Launched in July 2021, the service developed by Ava Labs is the most popular Ethereum connected bridge on TVL, exceeding US$ 6 billion on March 22, with the token wETH. The ethereum network already has its own version of wBTC, which takes the #16 position in market cap, with over BRL 57 billion in marketcap.

What is a bridge service?

The Portuguese translation of bridge is, literally, bridge. A bridge service in cryptocurrencies means a platform that allows you to send or use tokens from a blockchain on another blockchain that normally would not communicate without the help of a bridge. bridges in the market work in different ways, but the principle is always the same and usually involves trust – to a greater or lesser degree – in the service provider that will take custody of some assets held as collateral. To cross-chain transactions with a token that exists on both blockchains, the operation is less risky and the trust required is practically zero. For example, Alice has AAVE (ERC-20 token) on Ethereum and wants to use the AAVE token on the Avalanche network; that it can read ERC-20 tokens normally on its C-Chain.Know more: Avalanche launches Multiverse, a subnets acceleration program In this case, a bridge would hold some AAVE units on Ethereum and some amounts of AAVE on Avalanche’s C-Chain (in smart contracts) and when the user cross-chain, the platform receives AAVE of ethereum in your account and sends the correspondent from the other network to the user’s account. All automatically. For a bridge of different token patterns this is not possible. This is what happens with the ether (ETH) or the bitcoin (BTC) – yes, ether is not ERC-20. In this case, a bridge to the avalanche network involves a trust relationship, as the bridge platform will receive, for example, the user’s ETH in an escrow account and mint a new wETH token (wrapped ether), which the user will be able to use throughout the DeFi ecosystem of the blockchain. Original ETH. There are histories of attacks on some large bridges where the ability to redeem was impaired due to theft or bugs.Know more: Billionaire Wormhole Robbery May Have Created Solana DeFi BubbleThe BTC to avalanche bridge will work in a similar way.Read more:NovaDAX is full of news! One of the largest cryptocurrency exchanges in Brazil has now ZERO withdrawal fees in real! NovaDAX also counts zero fees for Bitcoin transactions and more than 110 listed currencies, with cash withdrawal available and high liquidity. Cryptocurrencies with the best rates on the market! Simply activate the free Novawards program and enjoy reduced rates of up to 75%. Discover the NovaDAX Card and order yours now.

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