Interlay, Polkadot’s (DOT) newly established parachain network, is nearing completion of a two-year project to develop a Bitcoin (BTC) bridge on Polkadot with the announcement of the launch of its Kusama sandbox.
In addition, Interlay has integrated the Wrapped Bitcoin (wBTC) digital asset, known as kBTC, into its Canary Kintsugi parachain. The asset is already available for trading on the other parachains Polkadot Karura operated by Acala and Moonriver operated by Moonbeam.
Interlay is expected to look to deploy its technology to both Cosmos and Ethereum over the next year to improve cross-chain interoperability.
As many of you know, kBTC, our flagship product at @kusamanetwork.kBTC, is a 1:1 Bitcoin-backed asset on Kusama backed by a decentralized collateralized vault network. KSM will be the first of many collaterals to back kBTC❗️ Detailed analysis https://t.co/AT8yC4iQqC— Interlay #interBTC (@InterlayHQ) March 24, 2022
Alexey Zamyatin, co-founder and CEO of Interlay, stated:
“Ethereum has $14 billion worth of Bitcoin DeFi controlled by a handful of centralized custodians behind KYC with no recourse for users or DApps if anything goes wrong. Even big players like Maker, Compound and Aave have implicit trust in a few traditional institutions.”
The initial development of this project was funded by an unnamed Web3 Foundation grant of up to $100,000 issued in March 2020.
Related: How Polkadot Parachain Auctions Enable Decentralized Web3
Since then, the interoperability project has been the subject of two investments: a $3 million seed round in July 2021 and a $6.5 million Series A round in December 2021. During the latest, the founder and CEO of lead contributor DFG Capital, James Waugh, stated that Interlay’s decision would “enhance cross-chain opportunities for Bitcoin.”
In February, Interlay was announced among the winners of the tenth slot of the Polkadot parachain auction, having received over 2.7 million DOT tokens from almost 20,000 participants.