Bitcoin has never had such opportunities for years and is only now making inroads into DeFi.
Cryptocurrencies have been part of our conversation for the last few years. While no one denies Bitcoin is the biggest cryptocurrency by market cap, its dominance has declined. In fact, it has been well below 70% for several months and shows no sign of moving up again. Current crypto market conditions are not helping with this matter, although it has helped create small momentum for the Bitcoin dominance metric.
Experts believe that new use cases are necessary for Bitcoin to become the leading global cryptocurrency and that adding smart-contract capabilities is key to securing that future. Although this metric doesn’t tell the whole story, it confirms Bitcoin has started lagging behind the Solanas, Cardanos, and Fantoms of the world. All these alternative networks provide access to decentralized finance (DeFi) opportunities. However, Bitcoin has not had such opportunities for years and is only now making inroads into DeFi. Additionally, one cannot overlook Ethereum, which remains the dominant blockchain for smart contracts and DeFi activities.
Even if BTC doesn’t become the world’s most valuable asset, it is definitely well on its way to establishing a firm presence in global financial markets. However, any asset that’s going to claim a significant share of capital markets also needs a supportive financial ecosystem.
Key Players in DeFi Space
Portal
With Portal, Decentralized finance becomes uncensorable, peer to peer, and trust minimized. Just like the underlying properties of Bitcoin. Portal swaps move provable execution of cross-chain contracts to layers 2 and 3, which allows the speed and liquidity of centralized alternatives, with the trust minimization guarantees of Bitcoin. Moreover, transactions are much faster and cheaper than Layer 1 transactions. These types of transactions are needed because most users are not going to transact with just a single blockchain. They’re looking to carry out quick, secure, and private crypto transactions with a wide range of tokens. That’s why the creators of Portal have secured millions of dollars in funding to develop a self-sovereign and uncensorable DeFi ecosystem on top of Bitcoin.
According to its developers, Portal will aim to offer widely-used financial services such as peer-to-peer lending. Many consumers and small businesses prefer working with P2P lenders like Bondora, EstateGurug, and Blend Network, among many others (based mostly across Europe). Also last year, Portal raised a US$8.5 million funding round to build a self-sovereign and uncensorable DeFi on Bitcoin.
RSK
RSK is the most secure smart contract platform in the world. Compared to Ethereum, it provides 40x – 50x cheaper gas fees, 10x faster transaction speed, and greater interoperability. There are many solutions provided by RSK like Defiant, which is the first mobile platform and P2P marketplace for stablecoins. Chainbeat provides blockchain data insights to help understand usage and behavioral metrics for smart contracts running on RSK.
RSK is an evolution of QixCoin, a turing-complete cryptocurrency created back in 2013 by the same development team. RSK provides an improved payment experience with near-instant confirmations. It achieves currently 300 tps and confirms most payments in less than twenty seconds. And yet, is still based on the same security guarantees Bitcoin has, supporting SHA-256D merged mining.
RSK works as a Bitcoin Sidechain. When Bitcoins are transferred into the RSK blockchain, they become “SmartBitcoins” (SBTC). SmartBitcoins are equivalent to Bitcoins living in the RSK blockchain, and they can be transferred back to Bitcoins at any time at no additional cost (except for standard RSK transaction fees). SBTC is the base currency used on the RSK sidechain to pay miners for transaction and contract processing. There is no currency issuance: all SBTC are created from Bitcoins coming from the Bitcoin blockchain.
Hyperledger
Hyperledger Foundation is an open-source community focused on developing a suite of stable frameworks, tools, and libraries for enterprise-grade blockchain deployments. It is a global collaboration, hosted by The Linux Foundation, and includes leaders in finance, banking, Internet of Things, supply chains, manufacturing, and Technology. Built under technical governance and open collaboration, individual developers, service and solution providers, government associations, corporate members, and end-users are all invited to participate in the development and promotion of these game-changing technologies.
Similar to The Linux Foundation, Hyperledger Foundation has a modular approach to hosting projects. The Hyperledger Foundation hosts developing business blockchain projects from Hyperledger Labs to stable code ready for production.
