Published on November 17, 2023, 6:15 am

Bitcoin, the leading cryptocurrency, has had limited applications compared to other blockchains that have expanded to enable asset transfers in various industries. However, a California-based startup called ZetaChain aims to change that by incorporating Bitcoin into decentralized finance (DeFi), an emerging trend in the blockchain industry.

ZetaChain is a Layer 1 blockchain that provides developers with a platform to build decentralized applications (dApps) and access other blockchains without the need for intermediary solutions such as “bridges” or “wrapped coins.” These solutions address one of the significant challenges in the crypto space – interoperability across different networks.

Ankur Nandwani, a core contributor at ZetaChain, explains that one of their breakthroughs is enabling developers to deploy smart contracts on the blockchain that can interact with native Bitcoin. This essentially adds a smart contract layer to Bitcoin and opens up new possibilities. Smart contracts, initially introduced by Ethereum, are lines of code that execute based on predefined rules and have resulted in various applications such as non-fungible tokens (NFTs).

ZetaChain’s integration with decentralized exchange (DEX) Sushi further advances its vision of incorporating Bitcoin into DeFi. With this integration, users can now swap Bitcoin across 30 different networks seamlessly. By deploying its Ethereum virtual machine-compatible smart contract on ZetaChain, Sushi can support native Bitcoins with minimal modifications. Importantly, these smart contracts can be accessed directly from the Bitcoin network itself, eliminating the need for users to leave their preferred network.

Jared Grey, Sushi’s “head chef,” expressed excitement about this development, emphasizing that it represents not only increased liquidity but also signifies a new era in DeFi where interoperability and enhanced connectivity are key considerations.

In addition to partnering with Sushi, ZetaChain integrated with centralized exchange OKX’s self-custodial wallet in October. This integration enables users to access dApps on multiple networks and utilize their Bitcoins in these applications without the need for wrapping or bridging from the Bitcoin network.

ZetaChain has garnered significant attention since its inception in 2021, particularly due to its $27 million Series A funding round that took place in August. The startup secured investments from notable firms like Jane Street Capital, Blockchain.com, and Sky9 – a China-focused early-stage venture capital firm.

The ability to integrate Bitcoin into the DeFi ecosystem is a significant step forward as it expands the use cases for both cryptocurrencies and blockchain technology. ZetaChain’s innovative approach to interoperability and smart contract deployment on Bitcoin could pave the way for new opportunities and advancements within the industry. With more developers actively building on platforms like ZetaChain, we can expect further growth and evolution in the emerging field of decentralized finance.

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