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Crypto firm, BitGo To Introduce an Ethereum-Based Crypto that will be Backed by Bitcoin

Crypto firm, BitGo To Introduce an Ethereum-Based Crypto that will be Backed by Bitcoin

BitGo, a US based crypto wallet provider recently announced that it is creating an ethereum (ETH)-based crypto token “Wrapped Bitcoin” (WBTC) which will be backed by Bitcoin (BTC) on a ratio of 1:1. The disclosure proves that Wrapped Bitcoin (WBTC) is designed to offer users with a “wide variety of new decentralized use cases including on decentralized exchanges (DEXs), as collateral for stable coins or lending, for payments and flexible smart contracts within the Ethereum ecosystem.”

WBTC token was created as a result of a major collaboration between BitGo, which is a cryptocurrency security and custodial firm; Kyber Network (KNC) which is a well-known decentralized liquidity pool; and also, the Republic Protocol (REN), a dark pool platform for institutional traders. A couple of companies are as well supporting the initiative, including the algorithmic provider of stablecoin MakerDAO and the decentralized exchange IDEX. Blockfolio and AirSwap trading company were also launch partners.

Bitgo said that it introduced the token with “full proof of reserve” subsequent to “significant institutional interest” in commodities, securities and real estate tokenization. According to the statement, users can check any Bitcoin stored in the blockchain that is available for monitoring via Etherscan while every Bitcoin on a dashboard with addresses and balances is considered.

BitGo acquired a government trust in South Dakota in early September to become a certified crypto currency custodian bank. Being a custodian, BitGo is subject to regulatory oversight in accordance with guidelines laid down by KYC and AML.

The three founding projects said WBTC would help users to enjoy the benefits of both blockchain family. The ETH community would have access to the greater liquidity enjoyed by the Bitcoin protocol, while BTC would be able to take advantage of capabilities of the Ethereum’s smart contract.

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