Osmosis, the largest decentralized exchange on Cosmos with Nomic and Kujira will introduce Bitcoin BTC ($27,349) to the eponymous inter-blockchain communications (IBC) protocol.
Users can transfer Bitcoin to the Cosmos network via Osmosis’ Nomic bridge for 1.5% of the transaction value, according to a statement made on October 3 during the Cosmoverse 2023 Conference.
Then, Nomic Chain issues Nomic Bitcoin (nBTC), an IBC-compatible cryptocurrency, to users on a one-to-one basis. On Osmosis, the nBTC can be bought, sold, and utilized as liquidity. Additionally, they work with more than 50 app chains that are connected to Cosmos.
On October 27 the nBTC Interchain Upgrade will be made available on October 30, and it is anticipated to go live. Users can deposit Bitcoin to the decentralized finance system Kujira’s Sonar wallet address and self-custody their nBTC thanks to a separate agreement.
Users’ BTC and nBTC wallets can be recovered using identical seed phrases. Additionally, the nBTC can be used as collateral for loans and borrowings within the ecosystem and to mint the native stablecoin USK of Kujira.
Users can also place bids on liquidated nBTC collaterals. According to Nomic’s creators, the cross-chain bridge would have a hard cap of 21 BTCs during the initial phases of nBTC’s introduction.
Applications won’t be able to generate deposit addresses, and consumers won’t be able to deposit any more BTC if the bridge reaches its capacity limit. In a future update, Nomic DAO governance will have authority over this parameter, according to developers.
