Kraken Introduces KBTC to Enhance Bitcoin's Utility Across Networks
- Patricia ArquetteOriginal
- 2024-10-18 13:30:24410browse
Kraken’s KBTC is an ERC20 token that allows bitcoin (BTC) to interact with decentralized applications (dApps) across Ethereum and OP Mainnet.
Kraken, a major cryptocurrency exchange, has introduced KBTC, a new wrapped bitcoin product fully backed 1:1 by bitcoin and compatible with multiple networks. The launch aims to expand bitcoin's use beyond its native chain and into decentralized finance (DeFi) ecosystems.
KBTC is an ERC20 token that enables bitcoin (BTC) to interact with decentralized applications (dApps) across Ethereum and OP Mainnet. According to Kraken, each KBTC token is backed by an equivalent amount of bitcoin stored in Kraken's custody. This backing can be independently verified through onchain reserves, ensuring transparency for users who wish to confirm that bitcoin holdings truly support their KBTC.
“We are thrilled to launch Kraken Bitcoin (KBTC), a fully backed, cross-network-compatible ERC20 representation of bitcoin custodied by Kraken,” the exchange stated on Thursday.
By introducing KBTC, Kraken aims to enhance the utility of bitcoin, allowing it to participate in DeFi, a rapidly growing sector. The integration of bitcoin into DeFi platforms will open up new avenues for users to utilize bitcoin in lending, borrowing, and other financial activities. This marks a significant step in bridging bitcoin with other blockchain ecosystems, broadening its potential applications beyond a store of value.
KBTC is built upon Kraken's existing security infrastructure, and a rigorous auditing process was conducted by third-party firm Trail of Bits, Kraken noted. The audit aimed to identify and address any security vulnerabilities within the KBTC smart contract, which has been designed to ensure that users' assets remain protected as they explore bitcoin's expanded use cases in various blockchain networks.
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