As the web3 landscape continues to expand with fresh narratives, mature financial products, and increased user adoption, most cryptocurrency markets remain siled within their local networks, resulting in siled environments that limit data and Free flow of value from one blockchain to another.
Exchange Bitcoin and Ethereum
ETH/BTC is the leading non-stablecoin trading pair with over $105 million in daily trading volume. Swapping Bitcoin for Ethereum also opens up a range of different possibilities, being able to leverage Bitcoin’s market and its community in the DeFi space. , inspiring further innovation.
Converting ETH to BTC, on the other hand, allows users to take advantage of Bitcoin’s robustness and its reputation as a “store of value.”
Current status of cross-chain swaps
One of the ways to exchange assets between two such major blockchains is to rely on centralized exchanges (CEX), which act as custodians for users to trade with their digital assets.
CEXs are managed by a single entity that has complete control over your funds and sensitive information. Additionally, these exchanges present risks such as being vulnerable to hacking attacks and scams. In the past, many cryptocurrency exchanges have been hacked and involved in illegal activities, resulting in the loss of user funds. Billions of dollars were lost.
As an alternative to CEX, decentralized exchanges (DEX) provide users with a non-custodial way to exchange BTC for ETH and vice versa, since assets are traded across different chains, each chain Governed by their own consensus protocol, they cannot be traded locally.
To solve this problem, DEX uses blockchain bridges to facilitate the transfer of assets from one chain to another. However, cross-chain bridges are vulnerable to hacking and fraud. For example, hackers exploited a vulnerability in Nomad Bridge in 2022, This resulted in a loss of nearly $200 million in the bridge's reserves.
Secondly, DEX also faces many challenges, such as high transaction costs caused by network congestion. For example, on DEX, the cost of exchanging ETH for BTC during severe network congestion may be as high as $100.
ICP’s trustless multi-chain technology stack unlocks bridgeless cross-chain exchange
ICP’s unique architecture is designed to foster a multi-chain environment, allowing smart contracts to easily communicate across multiple chains. Some features that support trustless multi-chain innovation include:
Bridgeless architecture
Using advanced encryption technology, ICP can directly integrate with the Bitcoin and Ethereum networks without the need for cross-chain bridges. Chain key technology enables smart contracts on ICP to conduct transactions directly on the Bitcoin and Ethereum blockchains without the need for cross-chain bridges. Interference by intermediaries, custodians or bridges.
Non-custodial cross-chain swap
Chain Key Bitcoin (ckBTC) and Chain Key Ether (ckETH) are native tokens on ICP and are 1:1 cryptographically protected by real BTC and ETH respectively. In this infrastructure, users can cross different blocks in a non-custodial process Chain exchange tokens.
Building a foundation with Chain Key technology
The overall design including chain key ECDSA and threshold cryptography makes it possible to trade non-native digital assets in a completely decentralized manner. Essentially, it performs the same functions as CEX and DEX, but without any third-party custodian. Get your funds exchanged or any cross-chain bridge.
ICP brings interoperability to switching
The blockchain ecosystem is in a state of evolution, interoperability will no longer be an add-on feature, but a necessary innovation. The architecture of the Internet Computer Protocol (ICP) brings interoperability to asset exchange, revolutionizing It provides a way for users to exchange assets across different blockchains.
ICP-based initiatives will push the boundaries of what is possible, ultimately contributing to the broader decentralization movement and shaping the future of the blockchain ecosystem.
How to convert to ckBTC and ckETH
Before starting the exchange, let's take a look at the process of converting BTC or ETH into the equivalent ck token. When a user wants to convert ETH to ckETH (or BTC to ckBTC), the following happens:
The user initiates the conversion process by sending ETH to an Ethereum smart contract controlled by the ICP smart contract, which then observes the payment event and mints ckETH for the sender;
The ckETH smart contract, which receives ETH and mints ckETH at a 1:1 ratio, is controlled by the NNS DAO, which governs the Internet's computer protocols;
The equivalent value of the user's ETH (now represented as ckETH) is sent back to the user, who can now leverage that value to access the web3 ecosystem within the ICP.
The code used to convert native tokens to ck tokens (and vice versa) is open source and most ICP wallets provide user interfaces for conversion, including NNS. ICP relies on chain key technology to facilitate this seamlessly. These transformations simultaneously ensure process safety and reliability.
Benefits of exchanging ckBTC/ckETH on ICP DEX
The exchange of assets is powered by decentralized exchanges such as ICPSwap, Sonic, and Helix Markets, and these decentralized applications are the building blocks for a trustless, multi-chain world.
Here are some of the features that users can take advantage of when conducting cross-chain swaps on the ICP decentralized exchange:
Gas fee
Decentralized exchanges that offer direct exchange between Bitcoin and Ethereum often charge significant fees due to high network activity on both blockchains. Unlike other platforms, the ICP ecosystem operates on a reverse Gas model. ICP The ecosystem is designed so that developers pay gas fees, not users.
Helix Markets and Sonic are DEXs powered by ICP that allow trading without gas fees and are lightning fast with transactions completing in under 1 second, which is especially beneficial for smaller transactions as it eliminates the need for other networks The burden of common high gas charges.
User friendly interface
The decentralized exchange on ICP brings a unique user experience to the exchange of assets based on different chains. Helix Markets provides a simple UI and UX for users to interact with other decentralized exchanges and smart contracts on other chains. .
ICPSwap has deployed front-end functionality within its platform where users can interact directly with the chain key technology and convert their BTC to ckBTC, and Sonic provides a seamless exchange interface for exchanging ckBTC to ckETH and vice versa.
unmanaged
In line with ICP’s decentralization principles, these decentralized exchanges provide a non-custodial way to exchange ckBTC/ckETH. On Sonic, token exchange is between users and smart contracts, completely independent of Third Party Infrastructure.
Helix Markets containers leverage the power of chain key technology to establish native communication and create trading pairs, not just with BTC and ETH, but with any ERC-20 asset.
Access the DeFi ecosystem
On ICPSwap and Sonic, users can use their ck tokens to access a variety of DeFi activities, and in addition to secure transfers, users can trade, stake, and participate in liquidity pools.
Additionally, users can choose to create trading pairs involving ckBTC and ckETH, which can help them earn fees.
These platforms also offer the ability to participate in staking pools such as ckBTC/ckETH to earn fees without incurring any transaction fees due to the reverse gas model, which helps provide a cost-effective and user-centric experience within the platform, In line with the principles of the ICP ecosystem.
DEXs built on ICP can leverage its unique architecture and become part of the effort to achieve a trustless, multi-chain world.
These DEXs pave the way for access to an integrated blockchain ecosystem by participating in the DeFi ecosystem by promoting security and user-optimized interfaces, and they represent an inclusive and accessible decentralized future.
resource
Sonic：sonic.ooo
ICPSwap：icpswap.com
Helix Markets：helixmarkets.io
internetcomputer.org/multichain
internetcomputer.org/ethereum-integration
internetcomputer.org/defi
#内容挖矿 #ckbtc #ckETH #DeFi $ICP
IC content you care about
Technology Progress | Project Information | Global Events
Collect and follow IC Binance Channel
Stay up to date with the latest information
