Anyone in the cryptocurrency market knows that Bitcoin is still the dominant factor in the market. The entire cryptocurrency industry started with Bitcoin. Satoshi Nakamoto created a universe that’s now worth more than 1.5 trillion dollars consisting of thousands of cryptocurrencies. However, Bitcoin is limited in its capabilities. Therefore new projects emerged to develop smart contracts, staking pools and many other use cases that weren’t available to bitcoin. Now, what if you could combine the strength of Bitcoin with the flexibility of the Ethereum blockchain?
The point here is, the entire emergence of Decentralized Finance has mostly passed the Bitcoin station and made sure projects like Ethereum, Binance and others became major players with billions of dollars in locked value. The bridge between the Bitcoin Blockchain and the Ethereum Blockchain exists, but it hasn’t been fully utilized yet. After deliberately observing current solutions and problems, BTC Proxy is ready to stand up and revolutionize DeFi for Bitcoin holders, maximalists and anyone in between.
What is BTC Proxy?
Let’s start off with a quote from BTC Proxy themselves on how they describe their project:
“BTC Proxy is a multi-institutional protocol for the decentralized tokenization of Bitcoin on ERC20 or MRC20 (Polygon) utilizing our Proxy Protocol called the Proxy Relay. It gives Bitcoin holders a decentralized bridge to stake their Bitcoin into custody and transfer that value into an ERC20 or MRC20 (Polygon) token without the need for centralized exchanges and systems that exponentially increase the counterparty risk of theft or loss.
BTC Proxy also allows for the transfer of value without price slippage and is independent of liquidity which is a factor that affects exchange prices on Centralized exchanges and Decentralized exchanges.”
That’s truly mouthful and a truly ambitious statement. When we dissect this quote, there’s one major question that comes up: what is the Proxy protocol called the Proxy Relay and how does it work? Let’s dive in to find out the mechanics behind the protocol!
Let’s start off with the Proxy Relay. This innovative piece of technique comes down to a bridge from the Bitcoin blockchain to Ethereum or Matic (ERC20 / MRC20) that allows you to convert your BTC to a token on Ethereum/Polygon. This newly minted token represents your converted BTC 1:1. Sure, moving across chains is cool but solely for the purpose of smaller transaction fees isn’t enough to convince the maximalist to move their precious BTC.
BTC Proxy took care of this by allowing anyone holding BTC to utilize the full canvas of DeFi products by converting their ‘normal’ BTC to a more versatile version of that some BTC. Momentarily, BTC holders can only use DeFi products through either centralized exchanges or converting their BTC to a token that represents that BTC as a synthetic on a different blockchain. These synthetic tokens can thereafter be used in various DeFi products such as staking, pooling, farming, lending, providing liquidity and borrowing.
Suddenly, BTC holders have an enormous yield-potential but the risks aren’t fully covered yet. Since, by converting your BTC to a token on a different chain some other risks surface like the custodian party holding the BTC you converted in the first place, fragile for exploits. To tackle these issues, BTC Proxy works with several measures to provide a cheap, decentralized and insured protocol. According to the BTC Proxy docs the Proxy Relay differentiates itself from other wrapped protocols by the way they use a side chain to “Relay” the BTC transactions.
Besides that, if we quote BTC Proxy directly, BTCProxy is “an institutional solution that holds Bitcoin directly with the custodian implemented with the safest policies and limits to ensuring that any BTC deposited is out of reach.” As you can see here, the project has a strong focus towards institutions to offer an extra form of returns on their investments in Bitcoin.
What is the current state of the product
The product is currently in beta. You can view the dApp yourself on https://app.btcpx.io/ and play around with the protocol. In the overview you see a really simple and clear interface where you do nothing more than connect your web3 wallet, confirm the requested transaction and you will receive the other currency, whether that’s BTC or BTCpx.
Beneath, you’ll see links to every single transaction and your personal transaction history to provide maximal transparency.
The currently available roadmap comes down to the image above. In here you can see that the protocol aims to become a roundhouse solution for any interested party. With custodians ranging from Ledger, Hex Trust, Coinbase and Gemini for maximum security. Besides that, the protocol aims to implement Binance Smart Chain, Tron blockchain and Polkadot as operating systems where the protocol can reach.
An exact timeline is unknown but we can see a wide range of products that have yet to be unravelled by the team!
The $PRXY Token
In the heart of the BTC Proxy protocol we find the $PRXY token alongside the BTCpx token. The BTCpx token is the synthetic BTC token that matches any converted BTC 1:1 and the $PRXY is the token with several utilities that can’t be overlooked easily. Whereas we see projects with zero to none utility for their token, BTC Proxy has made sure their token has widespread utility. The main features are the following;
- Bitcoin Farming: BTC proxy is the only protocol that allows you to farm Bitcoin. You simply stake your $PRXY tokens for a share of the transaction fees from the minting and redeeming of BTCpx. These fees are paid in BTCpx and redeemable for Bitcoin.
- Governance: Voting on the future of the protocol by different communities including Core Developers, Partners, Token Holders, and DAO Members
- Liquidity Mining: Anyone providing liquidity is incentivized with $PRXY token rewards by adding liquidity to the BTCpx Protocol or to AMM Liquidity Pools
- Ticker: $PRXY
- Token standard: ERC-20
- Network: Ethereum Blockchain
- Total supply: 21,000,000
- Initial Circulating supply: 2,391,000
- Initial market cap: $829K
- Token Type: Utility (Bitcoin farming, Governance & Liquidity Mining)
- Price in Private Round 1: $1.60
- Price in Public Sale: TBD
Who is behind the project?
We can all agree that a good idea is nothing without the right execution power. Looking at who’s behind BTC Proxy is something truly inspiring. We see some heavy-hitters combining their powers to mutually bring more utility to the one asset they all love, BTC.
When we look at the team, we should mention one thing: Kryptoin. The team behind BTCpx is the same team as Kryptoin, one of the few parties officially filing to launch a BTC ETF that’s currently under review by the SEC. That’s big and truly noteworthy.
Donnie Kim — Founder/CEO
3+ years blockchain development experience within exchange traded products. Crypto ETP Patent Filing Founder and Chief Operating Officer for the sponsor of the Kryptoin Bitcoin ETF Trust an S-1 filing in 2019 at the SEC for first Bitcoin ETP.
Vinod Morkile — Lead Blockchain Engineer
Principal architect and developer of technology proof of concepts and Android applications. Long experience in conceiving & developing many products and solutions for various domains like Healthcare, Security, e-Business, Enterprise Systems, Mobility and Networking.
Surendra Kumar — Full Stack Engineer
Stefan Georgievski — Business Development
Business Development and is responsible for fundraising, reaching out to investors and maintaining investor relations with existing partners
Jim Hong — Research Analyst
Research Analyst. Blockchain and Cryptocurrency early Adopter, writer, and advocate.
Eojin Lim — Operations
Benjamin Clarke — Strategic Advisor & Managing Director a195 Capital
Prior notable investments include Polkadot, ICON, WAN Chain, EOS, ChainLink, OMG, Quant Network, Trust Token, Kyber Network, Arweave, and UniLend.
Jason Toussaint — Advisor of Exchange Traded Products
Former CEO of World Gold Trust Services, Sponsor of the SPDR Gold Shares (GLD), world’s largest gold ETF with US$78 billion AUM. Managing Director and Global Head of Investment at the World Gold Council. Senior Vice President of Northern Trust Global Investments in London. Head of Asia for Morgan Stanley Capital International in Hong Kong.
Victor JW Lee — DeFi Advisor & Product Lead DAO Ventures
Victor is the Product Lead for DAO Ventures a DeFi Robo Advisor. More than 10 years of experience in technology product development, focusing on mobile and financial products.
Let’s have a look at all the partnerships that are noteworthy for BTC Proxy.
To quote Hex Trust: “Institutional adoption of Digital Assets & DeFi requires a fundamental shift in the way banks and financial institutions operate. Hex Trust is the link that connects the traditional financial world to the digital assets ecosystem.” — as we can see here, Hex Trust is one of the custodian parties that ensure maximal safety and transparency.
As we’ve mentioned before, the protocol uses the Polygon/Matic blockchain to optimize speed, small transaction costs and efficiency. The partnership between the protocol and Polygon isn’t very clear, but given the fact that the Polygon team works extremely hard to optimize their entire chain, we can assume that BTCPx receives any assistance required to make sure their protocol optimally utilizes the potential Polygon has to offer.
Launching a product these days can go through various ways. One way is by doing a funding round or an IDO, but another option is the launchpool route. Early believers in the protocol stake their tokens to later on receive a piece of the pie that’s available for all the stakers. Every single pool was filled instantly, so lots of trust in the protocol there.
To provide a proper foundation in terms of auditing and security, Quill Audits went through every single smart contract BTC Proxy has to offer. Quill Audits is a reputable company; “Quillhash delivers enterprise grade blockchain technology to leading companies worldwide.”
Beneath you’ll find a long list of heavyweights in the industry whom are backing BTC Proxy in their endeavour to open the gates to DeFi for Institutional parties.
- Fomocraft Ventures
- Master Ventures
- Alpha Sigma Capital
- Fibig Capital
- Iconomy Capital
- Jun Capital
We’re hosting an AMA on the 29th of July 2PM UTC with the team which you can attend in our Telegram channel!
Prepare any questions you may have and get ready for the AMA, we’re very excited and will update this review with the most important questions afterwards!
Follow Sylant on Twitter for updates!
Bitcoin is, and probably will always be, the dominant currency in this industry. One way to enjoy Bitcoin is by simply holding, but do you really use it with the full potential of the industry? With BTC proxy you can enjoy all the benefits of other, newer protocols in the DeFi sector while still holding on to your precious bitcoin.
BTC proxy is led by some heavy-hitters in the industry that filed for an official BTC ETF that’s currently under review by the SEC. That reputation has led to some major partnerships that will launch the project to the eyes of many people in the first period, and in the long run will be the gateway to institutions using the protocol, something other projects can only dream of.
We’re excited about the project and curious to see what they will bring. It’s currently still unclear what dates everything will arrive, but we’re sure that this team will deliver, and it will be good!
Yield farming website: https://prxy.fi
PRXY Tokenomics: https://proxy.btcpx.io/