The Internet Computer brings smart contract functionality to Bitcoin
The Internet Computer (IC) landmark Bitcoin Integration combines the liquidity of Bitcoin with the programming capabilities of IC’s smart contracts
ZURICH and SAN FRANCISCO, 5 December 2022 /PRNewswire/ — The DFINITY Foundationthe non-profit organization that contributes to the development of Internet Computer (IC) — the world’s first web-speed, internet-scale public blockchain — today announced the Internet computer’s mainnet integration with Bitcoinwhich brings advanced smart contract functionality to the world’s largest cryptocurrency. The Internet computer can now act as a layer 2 for Bitcoin where smart contracts on the Internet Computer can hold, send and receive Bitcoin naturally, without the need for blockchain bridges or other third parties. This provides a trustless foundation for various DeFi and Web3 applications trying to code Bitcoin.
Manu Drijvers, director of engineering at the DFINITY Foundation, explains: “Blockchains are like walled gardens, unable to interact with each other. When it comes to Bitcoinapplications, such as DeFi applications, that can benefit most from interacting with the world’s largest cryptocurrency do not have the opportunity to do so. Internet computer’s integration with Bitcoin is a true game changer for the industry, finally bringing smart contract functionality to life Bitcoin and enables a whole new landscape of DeFi and dapp development never before possible using BTC. We’re incredibly excited to see how developers interact with this revolutionary functionality.”
Now, the world’s most popular cryptocurrency can be used for DeFi activities such as yield farming, lending, payments and more. This is achieved through the Internet computer’s enhanced key chain cryptography. The direct integration with Bitcoin obliviates bridged and wrapped Bitcoin, a technique commonly used to facilitate interaction between different blockchains, and one that is prone to failure and often hacked. To activate quickly Bitcoin transactions between smart contracts on the Internet computer, the DFINITY Foundation is currently working with Chain-Key Bitcoin (ckBTC). Here, ckBTC will act as a local ledger facilitating fast transactions with low fees and only settle transactions on Bitcoin network when necessary.
Internet computer’s integration with Bitcoin also provides a more secure alternative to centralized bridges in the form of threshold ECDSA (Elliptic Curve Digital Signature Algorithm). The implementation of ECDSA enables the Internet computer’s container smart contracts to execute directly Bitcoin transactions without intermediaries or bridges. This provides a trustless foundation for DeFi projects to use Bitcoin and enables IC developers to code natively on Bitcoin.
Jan CamenischChief Technology Officer at DFINITY Foundation, said: “Making Bitcoin programmable will increase the overall potential of blockchain technology. Unlocks Bitcoinits unmatched liquidity will bring enormous benefits and new opportunities to users and developers across a wide range of dapps, including DeFi, GameFi, SocialFi and NFTs. This direct integration also eliminates the Achilles heel of other approaches to do Bitcoin available on other networks such as wrapping and bridging. Unfortunately, we’ve seen the downsides of these solutions over the past year through a number of high-profile hacks, leaving networks hopelessly vulnerable to attack. Bitcoin Lending via decentralized exchanges, for example, is now possible with security superior to that available on any other platform thanks to the internet computer’s direct and trustless integration, making it a natural choice for DeFi developers.”
The ICP developer community has long expressed strong demand for this feature. DEX projects such as Helix or IC Lighthouse are already building on it Bitcoin and chain-key signing capabilities to offer bridgeless token exchanges between chains. A few ecosystem dapps are also poised to launch some creative use cases beyond DeFi. Among them, the crowdfunding platform – CrowdfunNFT – will accept funding for projects in BTC. This will expand the crowdfunding market overall, bringing in a new set of project backers from crypto world. Other examples of interesting applications in development are transactions in BTC on NFT marketplaces and peer-to-peer transfer of BTC directly on social media and instant messaging dapps. The programmability of Bitcoin will open many more unique and imaginative use-cases in the future.
About the Internet computer
The Internet Computer is the world’s first Internet-scale public blockchain, developed by the DFINITY Foundation.
The Internet Computer overcomes the limitations of traditional blockchains and smart contracts to improve speed, storage costs, security and scalability, offering Web2 performance on an infinite Web3 platform. As a 100% trustless network, the Internet Computer is the only public blockchain in the world that offers end-to-end decentralization and does not use centralized cloud nodes. To further its decentralization, the Internet computer is governed by the Network Nervous System (NNS), a protocol-integrated DAO in which token holders have the power to vote on the future of the network.
The Internet computer mainnet was launched in May 2021after years of strategic research and development, by a team of more than 200 world-renowned cryptographers, distributed systems engineers and programming language experts at the DFINITY Foundation.
About the DFINITY Foundation
The DFINITY Foundation is the non-profit organization developing the Internet Computer – the world’s first web-speed, internet-scale public blockchain. DFINITY currently operates research centers in Zurich and California, and external teams in locations around the world. It has a global team of more than 200 people, which includes a number of well-known computer scientists, engineers and cryptographers. It runs the largest R&D business in crypto industry.
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SOURCE DFINITY Foundation
