Cardano (ADA) Founder Charles Hoskinson Unveils Groundbreaking Bitcoin Integration, Opening New DeFi Opportunities-web3.0-php.cn

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Cardano (ADA) Founder Charles Hoskinson Unveils Groundbreaking Bitcoin Integration, Opening New DeFi Opportunities

Linda Hamilton

Oct 29, 2024 am 03:22 AM

cardano Bitcoin DeFi Hoskinson

Cardano's (ADA) founder, Charles Hoskinson, recently shared insights into a groundbreaking development for the blockchain: the integration of Bitcoin

Cardano (ADA) Founder Charles Hoskinson Unveils Groundbreaking Bitcoin Integration, Opening New DeFi Opportunities

Cardano founder Charles Hoskinson has teased an exciting new development for the blockchain – the integration of Bitcoin liquidity into Cardano’s ecosystem. This move, which is enabled by the similarities in the UTXO models of both networks, will open up significant possibilities for Cardano’s DeFi sector.

“Bitcoin can flow into Cardano, and with Babel fees coming next year, they will be able to pay transaction fees in Bitcoin while under the hood ADA is being consumed,” Hoskinson highlighted.

?BREAKING: #Cadano will be able to sign #Bitcoin transactions while using $ADA as the gas fee ???BULLISH @IOHK_Charles ?

pic.twitter.com/0e6u4zLkB7

— Polkadot Leader (@PolkadotLeader) October 27, 2024

UTXO Model and Babel Fees

Cardano’s integration with Bitcoin is facilitated by their shared UTXO (unspent transaction output) model, which allows for seamless interactions between the two ecosystems. Unlike Ethereum’s account-based system, the UTXO model enables a higher level of predictability and flexibility for transactions.

Cardano’s ADA is also designed with an EUTXO (extended unspent transaction output) model, which enables multiple tokens to be bundled within a single transaction. This capability supports the cross-chain movement of assets like Bitcoin.

Hoskinson also highlighted the role of Babel fees in this integration. Babel fees allow transaction costs to be settled using various tokens, such as Bitcoin, while ensuring that ADA is still used behind the scenes, thus supporting ADA’s economic model. This mechanism “illustrates the power of Cardano’s approach,” providing flexibility without compromising the network’s integrity

A Trustless Bridge for BTC

In another recent development, a collaboration between Cardano and BitcoinOS (BOS) has resulted in the BOS Grail bridge. This bridge enables users to perform secure, trustless BTC transactions on Cardano.

BOS, a smart contract platform designed to extend Bitcoin’s functionality, is integrated with Cardano through the bridge, allowing for the seamless transfer of assets between the two blockchains.

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