Source: AdobeStock / Syda Productions
Web3 infrastructure firm Bitfinity Network has raised millions from major backers, while nearing the launch of its Ethereum Virtual Machine (EVM). Its founder talked with Cryptonews about how this EVM works to solve the issue of Bitcoin’s limited use, as well as about a potentially incoming wave of DeFi and tokenization on Bitcoin similar to that on Ethereum.
Bitfinity Network has successfully secured over $7 million in funding from major backers. These include Polychain Capital and ParaFi Capital. Max Chamberlin, Founder of Bitfinity, said the team is “thrilled to announce support from two leading investors in the blockchain space.”
According to the press release shared with Cryptonews, the funds will be utilized for the project’s “mission to establish off-chain infrastructure for Bitcoin and Ordinals. “
Chamberlin added that the backing reaffirms the company’s mission to bring greater utility to developers within the Bitcoin, Solidity, and Internet Computer (ICP) communities.
Ben Forman, Managing Partner at ParaFi Capital, said that solidity developers now benefit from Bitfinity’s high throughput, low fees, and Bitcoin-native support.
Solving the Issue of Bitcoin’s Limited Use
The announcement noted that this significant raise coincides with the development of the Bitfinity Ethereum Virtual Machine (EVM).
The team describes it as a Bitcoin sidechain integrated into the Internet Computer blockchain. There is also “the addition of Taproot assets on the horizon.”
It enables solidity developers and existing EVM-compatible services to build Bitcoin-enabled decentralized apps (dapps).
The Bitfinity EVM will enable the deployment of EVM dapps with speeds 100 times faster than Ethereum and at a fraction of the cost, the team claims.
The integration connects “the worlds of Bitcoin and Ethereum,” they said. This promotes greater interoperability and expands the possibilities for DeFi applications.
Bitfinity’s Founder, Max Chamberlin, told Cryptonews,
“Imagine putting your Bitcoin into a lending and borrowing pool or an automated market maker and earning yield from your Bitcoin. Imagine using Bitcoin as an asset for restaking and securing other networks. It’s important because it unlocks Bitcoin’s potential beyond being a passive investment bearing no interest or yield, solving the issue of its limited use.”
He noted that users can utilize numerous platforms on Ethereum to put their assets to use.
But there has been the explosion of asset types on Bitcoin, Ordinals, Runes, BRC20, etc, he said. There’s now a need for blockchain technology to enable DeFi services not just for Bitcoin but for the emerging token ecosystem on Bitcoin.
Incoming EVM Launch
Chamberlin said that the mainnet launch of the Bitfinity EVM is expected mid to late January.
It will be the first EVM to integrate with Bitcoin without relying on intermediary bridges, the announcement said.
Bitfinity uses the ICP’s threshold signature scheme (aka Chain-Key) to enable smart contracts to hold and transfer BTC and Ordinal assets on-chain.
“This approach offers heightened security and transparency compared to conventional bridge mechanisms — allowing developers and users to circumvent a $3b annual attack vector.”
Earlier, Bitcoin faced exclusion from DeFi due to its incompatibility with smart contracts. But the integration with ICP has finally made BTC accessible in DeFi.
ParaFi Capital’s Ben Forman commented that, as the demand to integrate Bitcoin increases, “we believe Bitfinity’s EVM opens up the Bitcoin ecosystem to novel use cases and applications.”
Chamberlin told Cryptonews that,
“Use cases could include lending and borrowing platforms and automated market makers (like Uniswap) that use Bitcoin as the base asset of the pools, as well as borrowing against your Ordinals (like NFTs on Bitcoin) and using this to trade or purchase other services.”
Notable Features of the Bitfinity EVM include Solidity smart contracts gaining access to ckBTC, fully decentralized stack, speeds 100 times faster than the Ethereum Mainnet, lower gas fees, and being audited by Quantstamp.
In this article we explore innovations like the Bitfinity EVM, the surge in ordinal inscriptions, enterprise adoption, and the promise of DeFi on #BTC.
Bitcoin’s massive untapped liquidity could pave the way for a new generation of Dapps! https://t.co/k8f5VNRlgm
— Bitfinity Network (@bitfinitynet) January 8, 2024
Expect a DeFi Wave
Chamberlin suggested that the road for developing off-chain infrastructure for Bitcoin and Ordinals will be bumpy – but worthwhile.
In the short term, there are “simple and somewhat centralized platforms” for exchanging both BRC20 and Ordinals, he said.
But a lot of infrastructure is needed to create DeFi services for Ordinals that are decentralized. This includes threshold signature schemes for custodying the assets on the side-chain or Layer 2 (L2) and decentralized indexers for Ordinals.
Per the Founder,
“These are all being built on ICP and Bitfinity. Once we have these two critical pieces of infrastructure, expect a wave of DeFi and tokenisation similar to that on Ethereum.”
Meanwhile, the press release said, Bitfinity’s roadmap includes integrating Taproot assets, including Ordinals and BRC-20 tokens, into its protocol. It will accomplish this by creating on-chain indexers that monitor Taproot asset transactions recorded in the segWit data fields.
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