Since Bitcoin completed the Taproot upgrade in November 2021, it has provided more efficient data storage capacity as a public ledger, providing a technical foundation for BRC20 assets, which are attached to BTC assets due to their huge value capture capability and decentralization, making it easier for the public to accept and recognize.
The second wave of BRC20 has begun, returning to the forefront in early November, with ORDI's market value exceeding $480 million and SATS' market value surpassing $290 million.
Despite the rapid rise in the market value of BRC20 due to Fomo and popularity, the biggest pain point for the BRC20 track is how to release its liquidity, which can be used for more innovative points and new narratives to drive and develop the track.
In this context, Dova Protocol has emerged.
- Analyzing Dova Protocol
Dova Protocol is a new DeFi protocol in the BTC ecosystem, aiming to bridge the gap between the Bitcoin ecosystem and EVM-compatible chains. With the surge in interest in decentralized finance (DeFi) from 2020 to 2021, Dova Protocol aims to bring some of these functionalities and liquidity to the Bitcoin network.
At its core, Dova provides a trustless bi-directional anchoring between Bitcoin (BTC) assets and tokenized BTC assets on EVM chains, allowing for broader application of Bitcoin ecosystem assets in the DeFi ecosystem. The protocol uses a dual anchoring mechanism, locking BTC assets on the Bitcoin blockchain while minting tokens representing the locked BTC assets on the EVM chain, which can be exchanged back for the locked BTC ecosystem assets at any time.
The Multi-Bit BTC-evm bridge lays the foundation for expanding the use cases of Bitcoin through DeFi, making functions such as lending, collateralization, cross-chain interoperability, and more traditionally applicable only to ERC-20 tokens possible. For example, Dova Protocol plans to launch lending and collateralization functions for the BTC ecosystem in the near future. The combination of Bitcoin's proof-of-work security minimization and DeFi functionalities on the EVM chain provides an attractive path towards decentralization and transparency.
BTC-EVM Future
Dova Protocol utilizes a decentralized relay network and EVM-compatible layer to bridge the growing utility gap between the Bitcoin ecosystem and Ethereum-centric DeFi ecosystem.
Dova's fundamental BTC cross-chain bridge sets the stage for the introduction of lending, collateralization, and other financial products, enhancing the composability of DeFi for Bitcoin. The further maturation of trustless cross-chain bridges and router protocols is expected to unify the fragmented crypto economy into a more cohesive ecosystem.
As the Dova protocol and related interoperability projects develop, the composability and transfer of cross-chain assets will unlock significant network effects for all participating networks. All of these services serve to promote broader crypto adoption by leveraging cross-platform advantages. The convergence of the Bitcoin ecosystem and Ethereum community and applications seems to be one of the most constructive combinations for building the mainstream blockchain DeFi track.
More about Dova
The Dova official website outlines the future roadmap:
In addition to the upcoming launch of the Dova token, Dova Protocol plans to launch a more user-friendly web UI for product optimization. Furthermore, it will bridge the assets of the Bitcoin ecosystem to support more wallet access. In the first quarter of 2024, the core business of collateralization and lending will officially launch, marking the basic completion of Dova Protocol's DeFi business module. In terms of technical infrastructure, Dova Protocol is also exploring the feasibility of supporting BRC-30 assets and applications.
In terms of community operations, Dova Protocol will focus on social media construction and community and brand promotion starting from the fourth quarter of 2023. Additionally, it will enhance community activity and user stickiness through airdrops, LP mining, and other methods. In terms of ecological cooperation, Dova Protocol will selectively cooperate with other public chains, exchanges, and DeFi platforms in technology and market aspects to expand user scale and application scenarios, enhancing the resilience of the Dova ecosystem.
From the timeline of the roadmap, Dova Protocol's pace is relatively cautious, focusing on 1-2 key tasks each quarter, ensuring the optimization of existing products and the development progress of new products, while also allowing for a significant margin for potential technical risks. This work rhythm emphasizes the quality polishing of technology and products themselves.
In summary
Dova Protocol has initiated a new narrative for releasing BRC20 liquidity, which means that more BRC20 will be applied to DeFi. As a result, the value of BRC20 assets will be further explored and circulated, and more liquidity will be captured. As a leading underlying layer, Dova will become the value benchmark for the BTC-EVM narrative, and will eventually support more liquid tokens and investors.
Dova Protocol will bring new vitality to the BRC20 track, expanding beyond minting and trading, and Bitcoin assets will be accepted by more on-chain investors, keeping pace with the rapid development of BTC and DeFi.
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
