nBTC will be usable in over 50 app chains linked to Cosmos IBC. Together with Nomic and Kujira, Osmosis, the largest decentralized exchange (DEX) on Cosmos, will bring Bitcoin to the eponymous inter-blockchain communications (IBC) protocol. Users can transfer Bitcoin to the Cosmos network via Osmosis’ Nomic bridge for 1.5% of the transaction value, according to an announcement made on October 3 at the Cosmoverse 2023 Conference. Users are then given one-to-one Nomic Bitcoin (nBTC), an IBC-compatible cryptocurrency created by Nomic Chain. On Osmosis, nBTC can be bought, sold, and utilized to provide liquidity. They can also be used across more than 50 Cosmos-connected app chains. Osmosis co-founder Sunny Aggarwal commented:
In order to achieve the long-awaited unification of a Bitcoin-centric Cosmos, Bitcoin desperately needs an application DeFi ecosystem, and Cosmos desperately needs a base money asset. Nomic will bring this long-awaited unification about. “The Cosmos ecosystem is too important to be without a seamless and secure way to receive BTC,” said Matt Bell, CEO of Turbofish, Nomic’s founder and primary contributor. Using BTC is the most seamless and secure way to on-ramp users into the Cosmos ecosystem, Bell said.
The nBTC Interchain Upgrade will be available on October 27 and go live on October 30. Users can self-custody their nBTC through different cooperations with the decentralized finance platform Kujira by sending BTC to the latter’s Sonar wallet address. Users’ BTC and nBTC wallets can be restored using identical seed phrases. The nBTC can also be used as collateral to mint Kujira’s native stablecoin, USK, as well as for lending and borrowing within the ecosystem. Users can also bid on liquidated nBTC collateral.
According to Nomic engineers, the cross-chain bridge would have a hard cap of 21 BTCs during the early phases of nBTC’s introduction. Applications will be unable to generate deposit addresses when the bridge reaches capacity, and users will be unable to deposit additional BTC.”In an upcoming upgrade, this parameter will be governed by Nomic DAO governance,” developers added.