BTC Proxy is a multi-institutional protocol for the decentralized tokenization of Bitcoin on ERC20 utilizing our Proxy Protocol called the Proxy Relay. It gives Bitcoin holders a decentralized bridge to stake their Bitcoin into custody and transfer that value into an ERC20 token without the need for centralized exchanges and systems that exponentially increase the counterparty risk of theft or loss. BTC Proxy also allows for the transfer of value without price slippage and is independent of liquidity which is a factor that affects exchange prices on Centralized exchanges and Decentralized exchanges.
Differentiating itself and improving on the design of other wrapped token protocols, BTC Proxy utilizes a side-chain to “RELAY” the confirmations of Bitcoin transactions to the ETH smart contract. The Relay side-chain is significant because it allows for further transparency and the pairing of both ETH and BTC transactions on the block for confirmation.
Importantly, this design reduces the enormous cost of verifying BTC blocks on the ETH smart contract and speeds up minting and redemption functions to real-time settlement. No intermediaries are required to execute the transaction.
To receive BTCpx for BTC, a user connects to BTCpx ethereum smart contract via Metamask. Following the smart contract connection, a bitcoin address is generated for the transaction via REST API call. This bitcoin address is unique and a new address is generated for every transaction in the platform.
Upon successfully generating the bitcoin address, the user needs to submit the bitcoin address to the smart contract. This bitcoin address is mapped against the ethereum address of the user. The mapping of bitcoin and ethereum addresses is a paid transaction.
When the user sends bitcoins to the address, the BTCpx backend in the dark node detects the transaction. Additional processes are followed as below:
The transaction is verified if it’s valid or not.
Transaction hash, raw hex, block height, and block header are sent to the Smart contract in Matic Network.
Transaction raw hex is decoded, and the transaction hash is extracted from the hex. Submitted hash and decoded hash from raw hex are verified.
If everything matches, then the transaction hash is verified in the current block and the current block is also verified.
The transaction’s raw hex is sent to the ethereum smart contract via side-chain data transfer.
Inside the ethereum smart contract, the transaction raw hex is decoded.
Upon decoding the transaction, transaction inputs, outputs are extracted.
Outputs include amount and address script. The address script is matched with the bitcoin address entered by the user.
If the address matches then corresponding tokens are ready to be claimed by the user.
Elegance in Efficiency
Lowest Gas Fees to Mint and Redeem
Confirmation of Bitcoin blocks onto an Ethereum smart contract using a Matic side chain make Proxy the cost effective choice
Lowest Minting and Redemption Fees
Confirmation in under 30 mins
On Chain Verifications
Comprehensive Crime Insurance
Commercial criminal insurance to further safekeep BTC Proxy client assets. The insurance coverage is arranged by Aon via a selection of international insurers.
The insurance is a proprietary Aon solution and covers theft of digital assets, via employee dishonesty or through third parties, held by Hex Trust on behalf of their clients.
DAO Member funds never mix with the general pool.
How do you use BTCpx?
Minting refers to the process of creating new BTCpx tokens. Minting is a decentralized process whereby the user interacts directly with the smart contract to verify the BTC has been sent to the custodian. The BTCpx smart contract verifies the Chainwork and Merkelroot of the Bitcoin transaction and validates that to approve the minting of new tokens. Your BTC is stored in custody so the new tokens are backed by Bitcoin at a ratio of 1:1. There are no central or manual process involved, the system is trustless and can confirm transactions at 30 min intervals. Use your newly minted BTCpx on DEFI applications or stake them for rewards.
Staking to earn ecosystem rewards by adding liquidity New pools will be added periodically. Add liquidity to the pools and stake the LP tokens to earn $PRXY.
Burning is the action of redeeming your BTCpx tokens for BTC. If you have BTCpx tokens and want your BTC back you simply redeem it. Interact with the app to burn the BTCpx tokens to take them out of the circulation supply and receive your BTC from the custodian.
Utilizing the Proxy Relay to confirm BTC Proxy transactions onto the ETH smart contract makes the system efficient with the lowest minting and redeeming gas fees.
Mint and Redeem
Minting and Burning maintains a 1 : 1 BTC/BTCpx ratio verifiable on chain for transparent accounting for all backed assets.
An institutional solution that holds Bitcoin directly with the custodian implemented with the safest policies and limits to ensuring that any BTC deposited is out of reach.
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One of Coinworldstory's longest-tenured contributors, and now one of our news,ico,hyip editors, Verna has authored over 6900+ stories for the site. When not writing or editing, He likes to play basketball, play guitar or visit remote places. Verna, to his regret, holds a very small amount of digital currencies.