The world of cryptocurrency is about to witness a significant development. The nBTC token is set to make its mark across more than 50 app-chains interconnected within the Cosmos IBC ecosystem.
At the forefront of this exciting move is Osmosis, renowned as the largest decentralized exchange (DEX) within the Cosmos network. In a groundbreaking collaboration, Osmosis, along with Nomic and Kujira, is set to bring Bitcoin into the realm of inter-blockchain communications (IBC) protocol.
This momentous announcement was unveiled on October 3, during the Cosmoverse 2023 Conference. Users will now have the ability to transfer Bitcoin onto the Cosmos network through Osmosis’ Nomic bridge, and the transaction fee for this operation is a mere 1.5% of the transferred value. In return, users will receive Nomic Bitcoin (nBTC), an IBC-compatible token issued by Nomic Chain, on a one-to-one basis. The nBTC can be utilized for buying, selling, and providing liquidity on Osmosis, marking a significant leap in the crypto landscape. Additionally, nBTC is not confined to Osmosis alone; it boasts usability across more than 50 Cosmos-linked app chains.
Sunny Aggarwal, co-founder of Osmosis, expressed his enthusiasm, stating, “Bitcoin is in dire need of an application in the DeFi ecosystem, and Cosmos requires a foundational monetary asset that can serve as its primary store of value. Nomic is poised to make this long-awaited collaboration for a Bitcoin-centric Cosmos a reality.”
“The Cosmos ecosystem holds immense significance, and it’s imperative that it has a seamless and secure method for receiving BTC,” added Matt Bell, CEO of Turbofish, the founder, and core contributor of Nomic. “Today’s announcement marks the beginning of an era.”
The nBTC Interchain Upgrade is slated for release on October 27, with activation expected on October 30. In an additional partnership with the decentralized finance protocol Kujira, users can send their BTC to Kujira’s Sonar wallet address and retain self-custody of their nBTC. Importantly, the same seed phrases can be used to restore both BTC and nBTC wallets. Furthermore, nBTC serves as collateral for minting Kujira’s native stablecoin, USK, and facilitates borrowing and lending activities within the ecosystem. Users can also participate in auctions for liquidated nBTC collateral.
It’s important to note that during the initial stages of nBTC’s launch, there will be a strict cap of 21 BTCs for the cross-chain bridge. When this cap is reached, applications will no longer be able to generate deposit addresses, and users will be unable to deposit additional BTC. Control over this parameter will be vested in Nomic DAO governance as part of an upcoming upgrade, as articulated by the developers.