Interlay introduces new protocol for Bitcoin’s reciprocal relationship with DeFi

Interoperability web Interlay has released a 21-page method whitepaper, titled XCC: Theft-Resilient and Collateral-Optimized Cryptocurrency-Backed Assets, advocating for the imminent improvement of cross-blockchain interoperability solutions to unlock a plethora of imaginable wrong the decentralized concern (DeFi) ecosystem.

As a Polkadot parachain, Interlay is focusing its efforts connected opening pathways of connection and enactment betwixt Bitcoin’s currency-native ecosystem, with the wider functionalities of the DeFi abstraction with networks specified arsenic Ethereum and Polkadot.

The newly-launched XCC protocol — serving arsenic an further furniture of XCLAIM which was introduced to the marketplace successful 2018 — enables greater plus sovereignty during cross-chain activities specified arsenic wrapping, arsenic good arsenic unifying Bitcoin multisigs with mechanisms typically autochthonal to the Ethereum web specified arsenic perpetrate chains.

To uphold the purported benefits of hazard aversion and superior efficiency, the XCC plus volition lone beryllium disposable wrong curated DeFi applications, however, users person the state to modulation to the interBTC merchandise if they necessitate greater flexibility. Both services volition beryllium successful tandem with each other, expanding the capabilities of Bitcoin’s DeFi marketplace to a wider user audience.

According to their assessment, XCC allows for “any Bitcoin that is staked semipermanent and is not intended to beryllium moved tin fundamentally ‘release’ its collateral”, and that this tin past beryllium “reused to unafraid other, ‘liquid’ BTC being bridged… allowing for vaults to service much users with the aforesaid collateral.”

Interlay co-founder & CEO, Alexei Zamyatin, shared his imaginativeness for the aboriginal of XCC some successful presumption of decentralized adoption, arsenic good arsenic a information enhancement, stating:

“interBTC, aiming to go the equivalent of DAI for BTC, already decentralized Bitcoin custody. However, the extremity ever was to execute non-custodial BTC DeFi - a precise hard occupation to solve. XCC sets a milestone successful this regard, yet enabling theft resilient and casual to usage Bitcoin DeFi.”

Related: Interlay aims to beforehand Bitcoin’s DeFi imaginable with caller interoperable bridge

A erstwhile recipient of a Web3 Foundation grant, Interlay announced progressions to their wrapped Bitcoin (wBTC) integer asset, kBTC successful mid-March, deploying the token onto their canary parachain Kintsugi.

Already supported connected Polkadot autochthonal parachain protocols Karura and Moonriver, the determination instigates their preparations for upcoming deployment crossed Cosmos and Ethereum sometime wrong the calendar year.