Many assets that are not ERC20 are falling into oblivion, limiting the total value of crypto that can be put into lending and yield farming in the Ethereum DeFi ecosystem. YFI is a prime example, this project offers a great Insurance and Storage product but is limited to assets on the Ethereum network. With 0.6% of all Bitcoins put into the Ethereum network, the potential of chaining is still wide open. Holders of non-ERC20 tokens have always wanted to put assets on the DeFi Ethereum network, so BoringDAO was born.
What is BoringDAO?
BoringDAO acts as a gateway connecting blockchains, for example, bringing Bitcoin to the Ethereum network in a completely secure and decentralized manner.
Cross-chaining seems quite boring, and users actually don’t need to understand its mechanism, they just need to know how to use this feature. However, it is very important to understand how to use it, if you do not know how it works, you will always worry whether your Bitcoin is safe or not?
Learn about the basic process
BoringDAO’s mechanism of action is easy to understand and simple. Let’s learn the example of converting BTC to bBTC in 3 steps:
Step 1: Alice marks her BTC and ETH addresses with the smart contract.
Step 2: Alice transfers some Bitcoins from her BTC wallet address to BoringDAO’s bBTC Channel.
Step 3: Alice’s ETH wallet address receives an equivalent amount of bBTC (BoringBTC – ERC20 format of Bitcoin).
Moving from bBTC to native BTC is the reverse process. And the cool thing is that your bBTC assets will be automatically collateralized up to 200%!
Here is a very interesting mechanism at BoringDAO called Double-Pledge, which will help you further protect the value of bBTC.
- At the asset class- holders will deposit 100% of BTC to generate bBTC via the bBTC Channel.
- At the contract layer- BOR Community members will receive from 75%-100% of the total converted value in BOR and other ETH network cryptos (such as ETH and DAI) in the “Channel”.
In other words, each bToken will be secured with more than 200% of assets (of which, 100% of the value of the original crypto-equivalent assets and about 100% of the value of BOR tokens or other assets in the Channel), including when the original token is stolen due to a certain error.
So where does Alice’s Bitcoin go?
Alice’s Bitcoin in the example will be transferred with BoringDAO’s Multi-Signature wallet managed with 3 separate institutions. Gradually the total number of private key holders will expand to 5,7,21 and more, making the BoringDAO ecosystem more and more reliable as it is used by more users.
Where did that 200% total guaranteed assets come from?
The BOR community will come together to create a channel – by holding ERC20 assets on a certain Channel, like BOR, ETH, DAI, one person can own a part of that channel. In each channel, 70% of fees generated along with 50% of fees burned will be distributed in BOR tokens to all channel owners as a reward. Moreover, those holding assets in the channel will be able to receive more rewards with “Boring Farm”, which we will describe in detail later.
The total value of token assets will determine the ability of a particular channel to generate tokens. For example, with a channel storing a total of $100 million worth of ERC20 digital assets (such as BOR and ETH), this channel would allow the generation of 10,000 bBTC, assuming the price of one BTC is 10,000 USDT.
Do users worry about assets being liquidated?
The answer is NO! Liquidation of assets will only take place if the original assets are damaged. When a channel’s asset retention rate falls below 100%, the system will automatically adjust the channel’s ability to generate tokens and stop doing so, liquidating assets. Even in that case, the generated tokens (bToken) will still be liquidated as usual.
In the future, the retention rate will be determined by the governance of the community, from 100 to 75% or less. This will not affect the value of the converted bToken, or the security of the channel, as all BTC mined through the channel have been loaded into a multi-sig wallet, to ensure the conversion from bBTC back. BTC.
What is the application of bBTC?
Users can use bBTC to build any application, because bBTC works on the ETH network, this token becomes a programmable digital asset, they can completely trade bBTC on DEX exchanges. such as Uniswap, Balancer and DODO.
Moreover, BoringDAO will issue “Boring Farm” that allows users to stake bToken to receive BOR rewards.
Investor & Partner
Tokenomics
Information about BoringDAO Token
• Token Name: BOR Token
• Ticker: BOR
• Blockchain: Ethereum
• Token Standard: ERC-20
• Contract: 0x3c9d6c1c73b31c837832c72e04d3152f051fc1a9
• Token type: Governance.
• Total Supply: 200,000 BOR
• Circulating Supply: 8,606 BOR
Token Allocation
Socials:
Website:https://www.boringdao.com
Telegram: https://t.me/boringDAO
Twitter: https://twitter.com/boringdao_defi
Summing up
Through the above article, CryptoChill has helped you learn about the Mantle Network project and the highlights of the project.
Disclaimer: This post is not investment advice. You will be 100% responsible for your investment decisions.
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