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Layer-1 blockchain Tron is contemplating a Bitcoin layer-2 answer that will help a “wrapped” model of Tether (USDT), probably permitting billions of {dollars} of liquidity to stream into the Bitcoin ecosystem.
In February, Tron’s founder, Justin Solar, introduced a roadmap for Tron’s Bitcoin layer 2 answer in an X submit, which might permit stablecoins and tokens to maneuver between between Tron and Bitcoin.
“This integration won’t solely hyperlink TRON immediately with Bitcoin but in addition facilitate entry to over $55 billion in worth to the Bitcoin community, thereby injecting monetary vitality into Bitcoin,” stated Solar on the time.
Talking to Cointelegraph, a Tron spokesperson stated the plans would “doubtless” contain making a wrapped model of USDT. The Tron community is at the moment house to greater than half of USDT’s $104 billion issued throughout a number of blockchains.
“As the house of main stablecoins like USDT, we deliver vital liquidity and stability to the desk,” Tron instructed Cointelegraph on Feb. 22.
The mixing would doubtless appeal to new customers to the Bitcoin ecosystem and increase the community’s use circumstances, notably in decentralized finance, they added.
Solar stated a Bitcoin layer 2 answer would permit TRON-based tokens to work together and interoperate with Bitcoin “seamlessly.”
“[It will aim to] preserve the velocity and low charges of POS methods whereas making certain the protection of POW & UTXO at the side of BTC L2!”
The Tron spokesperson stated the plan is just in its idea section however will “doubtless” go forward.
In the interim, the agency will leverage present cross-chain protocols to bridge USDT and different tokens between Bitcoin and Tron. A part of Tron’s plan additionally entails collaborating with a number of Bitcoin layer 2 protocols.
A rival stablecoin to Tether, USD Coin (USDC), could possibly be a unique story as Circle, its issuer, ceased minting USDC on Tron in February.
The Tron spokesperson stated a latest surge in group curiosity to increase Bitcoin’s performance and scalability was one of many fundamental the reason why it thought-about constructing a layer 2 answer.
Growing decentralized functions on Bitcoin may probably enhance Bitcoin’s (BTC) value dynamics too, as charges can be denominated in Bitcoin, they added.
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In the meantime, Tron’s decentralized autonomous group, TRON DAO, can be trying to construct a user-friendly pockets and toolset to help Bitcoin-based Ordinals and BRC-20 tokens.
Cryptocurrency funding agency CoinShares predicted in January {that a} Bitcoin-based stablecoin could emerge in 2024 that might rival the velocity and price of different stablecoins within the trade.
Liquid-based Tether (L-USDT) is without doubt one of the few United States dollar-denominated stablecoins at the moment circulating on a Bitcoin layer-2 community.
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