MakerDao governance, the decentralized association of MKR token holders that supervise the Maker Protocol, has accepted the Wrapped Bitcoin (wBTC) as a new collateral asset in the protocol so that it could be used on Ethereum blockchain also, an announcement on May 03, 2020.
WBTC Can Generate Dai
WBTC has now become the first token of ERC20 which is supported by Bitcoin also in 1:1 and it is the fourth collateral asset type that has been integrated within the Maker Protocol.
Before wBTC, Ethereum (ETH), Basic Attention Token (BAT) and Tether (USDT) became the part of the protocol.
Now, the wBTC could create Dai by opening the Maker Vaults.
According to the MakerDao governance’s notification, “WBTC will help bring greater liquidity to the Ethereum and decentralized finance (DeFi) ecosystems, and to decentralized exchanges (DEXs)”.
The protocol would allow the trading of Bitcoin so that the holders could open the vault and develop Dai with the help of wBTC.
Open Vault Through Oasis Platform
The user needs to complete 5 steps while opening vault on a decentralized finance platform, Oasis Borrow.
The report explains that first, the user needs to sign up to Coinlist, then complete its KYC process. Later, it would have to wrap BTC to wBTC, then transfer wBTC to the wallet which is compatible. After all this, the user is allowed to develop a vault for wBTC so that it could generate a new DAI.
On February 07, 2020, Ether worth over $1 billion US dollars existed in DeFi protocol. On the same day, the trading value of the asset increased by 4.5 percent and its weekly increment was around 22 percent.
A report by Defipulse.com stated that Ether’s locked amount in the market is entitled in the DAI stablecoin of MakerDAO by around 60 percent.
Reportedly, the early adoption of Bitcoin in DeFi protocol created doubts among the crypto experts but their interest and curiosity in it remain same.
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