BitGo has officially selected LayerZero as its interoperability protocol for Wrapped Bitcoin (WBTC), marking a significant move in the digital asset custody and decentralized finance (DeFi) sectors. The announcement, made on September 10, highlights LayerZero’s Omnichain Fungible Token (OFT) standard as the chosen framework for managing WBTC across multiple blockchain networks.
Expansion of WBTC to New Blockchain Networks
LayerZero’s integration will support BitGo’s expansion of WBTC into additional blockchain ecosystems, including BNB Chain and Avalanche. Initially launched in 2019 to bring Bitcoin into the Ethereum-based DeFi landscape, WBTC has facilitated various DeFi activities such as lending, borrowing, and swapping. With these new integrations, WBTC will extend its reach to two of the top blockchain networks by total value locked, as ranked by DeFiLlama.
Enhancing WBTC with LayerZero’s OFT Standard
LayerZero’s OFT standard enables WBTC to be used natively and transferred across supported blockchains without the need for traditional token bridging from Ethereum. This move is expected to mitigate risks associated with token bridging and offer enhanced benefits, including omnichain composability, unified supply, and modular security.
BitGo plans to implement its own decentralized verifier network (DVN) to ensure that all omnichain WBTC transactions are accurately verified. This network will be developed in collaboration with Polyhedra and LayerZero Labs.
Broader Impact and Industry Reactions
The selection of LayerZero underscores BitGo’s commitment to advancing the utility and security of WBTC within the DeFi ecosystem. With the expansion to BNB Chain and Avalanche, WBTC’s presence will be further solidified across major blockchain networks, offering users increased flexibility and access to a broader range of DeFi services.
The collaboration marks a significant development in the ongoing evolution of cross-chain interoperability and highlights LayerZero’s growing influence in the blockchain space.
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