As a typical representative of bringing BTC into the Ethereum ecosystem, WBTC remains the largest BTC encapsulated token in terms of market value, with data showing that its total circulation has now exceeded 150000.

Article author: 1912212.eth, Foresight News

Article source: Foresight News

Last month, BitGo, the centralized acceptor behind the largest packaged Bitcoin WBTC, announced the establishment of a joint venture with Bit Global in Hong Kong to take over the WBTC business. Behind Bit Global is Justin Sun.

Although Justin Sun later responded that participating in WBTC is entirely strategic and will not control the private keys of WBTC reserves, nor can he move any BTC reserves. The coinage process is fully managed by the custodian agencies Bitglobal and BitGo, following the same procedures as before. But the community clearly did not buy it, and once the news came out, it triggered widespread dissatisfaction in the community. Some communities expressed concerns about its WBTC control and security.

As a typical representative of bringing BTC into the Ethereum ecosystem, WBTC remains the largest BTC encapsulated token in terms of market value, with data showing that its total circulation of WBTC has now exceeded 150000. Kyber Network co-founder Loi Luu believes that the success of WBTC can be attributed to its community centered approach, simple and easy to understand technical design, clear trust mechanisms, and first mover advantage.

The method adopted by WBTC is relatively simple. Users can exchange BTC for WBTC through acceptors, or redeem it through acceptors. The importance and status of the acceptor in this process are self-evident. At present, the only acceptor of WBTC is BitGo.

During BitGo's tenure as an acceptor, WBTC has withstood the test and so far, there has been no crisis of trust.

Acceptance under centralized mechanisms greatly tests the credibility of institutions. Whether it is reliable or not is a matter of great concern to the vast majority of people.

The problem lies in BitGo's announcement of a joint venture with Bit Global, which is controlled by Justin Sun. The community is concerned that it may misappropriate collateral and believes that this will reduce the security of WBTC.

BitGo CEO Mike Belshe emphasized the company's commitment to security and downplayed Justin Sun's involvement. Even Justin Sun himself responded on Twitter, stating that he will not control the private keys of WBTC reserves and cannot move any BTC reserves.

The community still doesn't buy it.

Recently, the Twitter account @ wbtcparty initiated the saveWBTC movement to express dissatisfaction. The Twitter community immediately began to spread related tweets, and even official tweets from multiple project parties such as Curve, Synthetix, Wormhole Ecology, Mezo, Enzyme, etc. were reposted to support the event.

In addition, the event also launched a signature campaign on Galxe, with a total bonus of $6000 provided by the initiator and the community. As long as users who meet the requirements sign and participate in the event, they will receive an OAT and bonus after the event ends.

Thanks to the response from some well-known project partners and the incentive of activity bonuses, as of the time of publication, there are still related activity tweets emerging continuously for saveWBTC.

In response to this, the CEO of BitGo reiterated at the recent South Korean Blockchain Conference that the cooperation with Bit Global aims to eliminate the risk of single point of failure and expand its business in Asia. He admitted that Justin Sun is a controversial figure, 'most companies wouldn't even mention his name, but we did because transparency is important'.

Community proposal: Will tWBTC merge with WBTC?

Save WBTC did not just stay in the controversy of Twitter rhetoric, the community quickly proposed a solution, which is to merge WBTC with Threshold's tBTC.

Some readers may not be familiar with its project background, but Threshold Network is a new project formed by the merger of Keep Network and NuCypher. TBTC was originally launched by Keep and is a permissionless and decentralized Bitcoin bridge. TBTC replaces centralized intermediaries with a randomly selected group of operators running nodes on the network, who collectively use Threshold encryption technology to protect the Bitcoin deposited by users. According to the data website, the current circulation of tBTC exceeds 3600 pieces.

The proposal suggests combining WBTC's user base, integration, liquidity, and brand awareness with tBTC's decentralized hosting and permissionless bridging mechanism to better achieve BitGo's multi jurisdictional and multi institutional hosting goals. At the same time, it can also ensure the security and stability of the collateral.

This proposal has gained considerable views and has been widely discussed.

Summary

At present, there are generally two ways for the cryptocurrency industry to play with BTC. One is to build a prosperous city on its own ecosystem, such as BTC's L2 and re staking. The other is to package it and put it into the Ethereum ecosystem under the ERC20 standard. The former method is still under slow construction, while the latter method, although not successful in many years of attempts, has also achieved some small gains. At present, it is not known whether the proposal will ultimately be submitted for discussion by the community, but the issue of how to achieve decentralization by encapsulating Bitcoin may continue to be discussed.

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