Bridging Bitcoin to Cosmos

In a groundbreaking move, Osmosis, the leading decentralized exchange (DEX) in the Cosmos ecosystem, is set to incorporate Bitcoin (BTC) into its inter-blockchain communication (IBC) protocol. This announcement, made at the Cosmoverse 2023 Conference on October 3, highlights a new partnership with Nomic and Kujira, promising a future where BTC users can easily venture into the Cosmos realm.

The Nomic Bridge Explained

So, how does this work? Users can transfer their precious Bitcoin to the Cosmos network via the Nomic bridge, which is supported by Osmosis. For just 1.5% of the transaction value, users receive Nomic Bitcoin (nBTC) on a 1:1 basis. Think of nBTC as your VIP pass to more than 50 Cosmos-linked app chains. Whether you’re a trader, liquidity provider, or just curious, nBTC offers diverse opportunities to engage within this expanding ecosystem.

Comments from Key Players

Sunny Aggarwal, co-founder of Osmosis, voiced his enthusiasm, stating, “Bitcoin is in deep need of an application DeFi ecosystem, while Cosmos needs a stable money asset to enhance its value proposition.” Likewise, Matt Bell, CEO of Turbofish—Nomic’s founder—asserted, “Today’s announcement marks the beginning of a smoother, safer way for users to onboard BTC into the Cosmos ecosystem.” Both perspectives highlight a critical interaction between Bitcoin and decentralized finance (DeFi) within Cosmos.

Upcoming Launch Details

The nBTC Interchain Upgrade is set to roll out on October 27, with activation on October 30. During the launch phase, users can utilize their nBTC in various capacities, including:

• Providing collateral for Kujira’s stablecoin USK
• Engaging in lending and borrowing activities
• Bidding on liquidated nBTC collaterals

Moreover, through a collaboration with Kujira, BTC holders can send their Bitcoin to the Sonar wallet. This ecosystem facilitates self-custody of nBTC, meaning users hold the keys to their crypto futures!

Limitations to Observe

It’s worth noting that, initially, there will be a hard cap of 21 BTC on the cross-chain bridge. This means that once this limit is reached, new applications won’t be able to create deposit addresses. Users will need to stay alert or risk missing out! The limit will be managed by the Nomic DAO governance.