RenBTC, a tokenized form of Bitcoin on Ethereum, is skyrocketing in price, total volume, and locked value as investors turn to BTC to farm yields on decentralized finance (DeFi) platforms. The platform, which is a close competitor to wrapped BTC (wBTC), set an all-time high of 10,014 BTC locked as of Tuesday, before retracing to 8,326 BTC currently, according to DeFi Pulse.
— DeFi Pulse 🍇 (@defipulse) August 17, 2020
As of June 1, the total value of BTC locked in renVN stood at $2.478 million. Since the value of BTC secured in ETH through the platform has skyrocketed to $157 million as of writing, a slight fall from the all-time high set at $176 million on Aug 18. The wrapped BTC (wBTC) competitor now accounts for almost 20% of the total 43,004 BTC tokenized on ETH, according to btconethereum.com.
The surge follows increased interest in DeFi products from the crypto ecosystem as the industry keeps setting new all-time highs in total token market cap and the value locked in these platforms. Moreover, Bitcoin holders are increasingly finding ways to get into the DeFi space using the most significant crypto asset in a bid to access the “exponentially growing” yield farming.
RenBTC is used to provide cross-chain liquidity across DeFi platforms such as Uniswap and Curve Finance. The system is an open-sourced protocol that is entirely dependent on the blockchain to mint and destroys RenBTC according to the demand and supply on the platform. RenBTC tracks the price of Bitcoin.
These decentralized finance products open up the world to a new way of sourcing and pooling liquidity while enhancing the security, and lowering the costs involves comparative to the traditional legacy system. In a transaction completed on Wednesday, a trader converted over $4.1 million from wBTC to renBTC through the Curve Finance protocol, paying an $8 fee and only 13 seconds to complete the transaction.
Image from Twitter
The DeFi growth is in no way changing the minds of some Bitcoin maximalists on the need for Ethereum-based BTC. Blockstream founder and CTO, Samson Mow claim the increasing tokenization of BTC on ETH is a testament that Ethereans need BTC. He said in a podcast,
“The whole reason that Bitcoin is staying wrapped to be used on Ethereum is that it is stable and reliable.”