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21.co, the father or mother firm of asset administration agency 21Shares, has built-in Chainlink Proof of Reserve on the Ethereum and Solana mainnet to bolster transparency of its wrapped Bitcoin product, 21BTC, in keeping with a Sept. 23 assertion.
The corporate will use Chainlink’s Proof of Reserve by way of its digital asset platform, Onyx, to automate real-time reserve verification to make sure safe minting of 21BTC.
The agency stated the combination will straight lead to decentralized oversight and transparency, which can profit customers and enhance confidence within the token. Customers will be capable to independently confirm asset collateralization in actual time.
21BTC was first launched on Solana in Could and in a while Ethereum in September. It’s a absolutely backed token with 1:1 Bitcoin reserves held in chilly storage.
Johann Eid, Chief Enterprise Officer at Chainlink Labs, stated:
“Proof of Reserve’s position in enabling a safe minting perform is a key step to making a dependable framework that enables for the tokenization of trillions of {dollars} in worth.”
Coinbase rival’s challenges
Whereas 21.co has targeted on bettering transparency for 21BTC, Coinbase’s wrapped Bitcoin (cbBTC) continues to face scrutiny.
On Sept. 23, 0xngmi, the founding father of DeFillama, criticized Coinbase’s cbBTC’s lack of transparency. He stated:
“Nearly each single bridge (together with WBTC) gives a Proof of Reserves so you possibly can examine that the issued cash are backed. However Coinbase doesn’t, cbBTC is approach under the usual when it comes to transparency.”
This comes as Coinbase’s Chief Authorized Officer, Paul Grewal, additionally needed to tackle issues about cbBTC’s phrases of service. Some X customers had raised alarms that the trade might not absolutely reimburse misplaced Bitcoin in instances of malicious exercise or unexpected occasions.
Nevertheless, Grewal clarified that Coinbase’s legal responsibility solely covers the Bitcoin misplaced. It doesn’t lengthen to losses from trades or leveraged positions. He acknowledged:
“It’s a limitation on legal responsibility that’s fairly fundamental: we aren’t responsible for greater than the BTC we lose. This language additionally makes clear the custodial relationship.”
Regardless of these issues, cbBTC has gained traction, with almost 3,000 tokens circulating inside two weeks of its launch. It has shortly grow to be the third-largest wrapped Bitcoin token, with a market capitalization of round $170 billion and a buying and selling quantity that has surpassed $1 billion within the final 24 hours, in keeping with Dune Analytics information.