Uncapped minting will now be live by the end of January
2022 has been a year of upheaval in Web3. In June, TerraUSD and LUNA collapsed, freezing tens of millions of dollars in customer deposits. And in November, FTX and its associated hedge fund Alameda Research shocked the world when they declared bankruptcy. It has since been revealed that FTX had been funneling customer deposits to Alameda to fund investments and other projects, wiping out as much as $8 billion from user accounts. The shockwaves from these crises are still reverberating through the crypto markets.
In light of these events, the need for truly decentralized infrastructure has never been more clear. Foremost among these, is a robust, decentralized, permissionless bridge for the premier crypto collateral: BTC. With the sudden emergency shutdown of renBTC due to control by Alameda, there is no permissionless way to use BTC in DeFi and billions of dollars are currently stranded.
In response, we are accelerating the launch of tBTC minting as much as possible while preserving safety.
Previously, the launch of tBTC was going to happen via a phased rollout with minting caps increasing over time. However, with the lack of any alternatives in the market we believe the urgency is too high to wait.
Due to this, minting is now expected to be live by the end of January.
DeFi needs a stable, secure, and scalable gateway solution now more than ever. Before we dive into the new roadmap, it’s important to explain the developments that have allowed for this accelerated schedule.
Ultimately, minting on tBTC v2 will be fully permissionless.
- In this model, depositors make their deposits, which are swept by stakers to a shared wallet with an SPV proof. Depositors do not need to report on the state of the Bitcoin chain.
- Stakers perform work on the network. They provide proof that the deposited BTC has been swept. The network is permissioned to stakers, who can deny deposits.
- This model includes full proof of reserves.
In the interim period before permissionless minting is fully launched, tBTC v2 will roll out a system of optimistic minting. This model includes two additional roles: Minters and Guardians.
- Minters: a small permissioned group of between three and seven pseudonymous, technically expert participants with deep experience in decentralized finance. Minters are responsible for monitoring the chain for revealed deposits. Upon seeing a valid deposit, a Minter requests to mint the requisite tBTC. An automatic delay of three hours is triggered before minting is completed.
- Guardians: During this three hour period, a second group, the Guardians, can cancel a mint if they determine it to be nefarious – due to fraud or any other issue – and remove the errant minter. Guardians will be permissioned and drawn from the Threshold DAO and broader DeFi community. There is no upper limit on the number of Guardians.
In summary: In this period before permissionless minting, a nominated group of Minters make the decision to mint tBTC instead of stakers, with a failsafe group of Guardians given the opportunity to cancel fraudulent or improper mints.
Chaosnet sequence going forward
In light of these updates, the Chaosnet sequence going forward is now as follows:
What’s in store for the future?
Eventually, the project will transition to the permissionless model with stakers in charge of mints. With this launch, we are on the path to that goal.
Safe, Secure, Scalable
tBTC is using unprecedented technology to deliver a secure, scalable, decentralized BTC-ETH bridge. Our goal is to change the crypto paradigm and make it possible for the wealth held in BTC to be deployed across the dynamic, fast-evolving Ethereum DeFi universe. The sequenced launch of tBTC is designed to ensure that its trailblazing capabilities are rigorously tested and that it reliably delivers fully decentralized cross-chain capability at scale.