The Ethereum Layer 2 network Mantle has introduced FBTC, a new currency with a 1:1 peg to Bitcoin. This is a major step that will change the way Bitcoin and decentralized finance (DeFi) work together.
Ignition’s assistance in creating this strategic project aims to enhance the usefulness of Bitcoin in the DeFi world by providing new opportunities for BTC holders to earn returns on their holdings.FBTC, a fully backed Bitcoin currency, serves as a bridge between Bitcoin and various blockchain platforms.
Holders of FBTC can access a range of DeFi services. Mantle is adding FBTC to its list of assets, which now includes more than just Ethereum-based tokens like $mETH. This is a big move into the Bitcoin market. This move fixes problems that already exist in the BTCFi sector, like fragmented liquidity and negative user experiences.
Ethereum Layer 2 Enhances DeFi
FBTC aims to simplify the process of gathering capital across multiple chains by utilizing Ethereum Layer 2. This will give Bitcoin users a smooth DeFi experience. This new idea lets people do things like loans, staking, and providing liquidity that Bitcoin holders couldn’t do or couldn’t do as easily before.
FBTC uses many advanced cryptographic methods, including multi-party computation (MPC) and threshold signature schemes (TSS), to connect Bitcoin to other blockchain-based banking systems. These steps ensure the safe management of BTC assets within the overall blockchain environment.
The release of FBTC comes at a time when the DeFi market is growing quickly. This is because bitcoin owners are looking for ways to make their assets worth more. Users can participate in activities that generate yield, which raises the value of their Bitcoin, by exchanging BTC for FBTC on the Ethereum Layer 2 network.
This new way of doing things has already begun to have a positive effect on the market. The value of Mantle’s native token, MNT, has gone up by 5%, which shows that investors are optimistic about the network’s new project.
According to data from the blockchain, trading volume has increased by a huge 86.25%, hitting $10.96 million. At the same time, open interest in MNT derivatives has grown by 5.12% to $11.15 million, which shows that traders are optimistic about the future.
