The decentralized network Internet Computer Protocol (ICP) has effectively integrated threshold-Schnorr signatures, enabling it to tap into the power of Bitcoin‘s decentralized finance (DeFi) and web3 systems.
Based on information obtained by CryptoPotato, the upcoming digital signature method is expected to allow ICP contracts to adopt the Bitcoin token protocol, known as Runes, and facilitate trading of BRC-20 tokens.
Implementing Threshold-Schnorr Signatures
The Threshold-Schnorr digital signature method allows multiple network users to collectively hold the secret key for signing transactions and messages on the blockchain, enhancing security.
ICP announced that merging threshold-Schnorr-BIP340 with the Bitcoin network, as per their integration, opens up new avenues for developing decentralized applications. These apps can tap into Bitcoin’s liquidity and security without relying on centralized intermediaries. The incorporated signature scheme caters to both fundamental and advanced functionalities such as decentralized exchanges and Bitcoin inscriptions.
Following the upcoming Bitcoin halving, the income from new blocks created through mining will be reduced by half. Consequently, mining activities may no longer be financially viable for miners. To continue operating, they’ll need to generate revenue primarily from transaction fees instead. By developing and implementing innovative uses of Bitcoin, the importance and value of blockspaces can be enhanced, leading to an increase in transaction fees.
Over the past year, it’s been thrilling to witness the surge in creativity and diversity of projects developing the Bitcoin economy and the broader Web3 landscape. Builders have utilized ICP to tackle fundamental issues within Bitcoin, such as adding functionality for inscribing and trading images, generating returns on BTC, and expanding the community, as explained by Aisling Connolly, Senior Research Scientist at the DFINITY Foundation.
Solving Problems in The Industry
Threshold-Schnorr integration on Bitcoin network not only expands its applications but also enables ICP smart contracts to record ordinals in a decentralized manner, transfer and receive BRC-20 tokens, and sign Taproot transactions.
Connolly explained that the integration’s goal is to address the challenges of coordination in the cryptocurrency sector by introducing capabilities, efficiency, and safety to transactions not only on Bitcoin but also beyond it. The complete rollout is scheduled for completion by summer.
Currently, ICP, or Internet Computer Protocol, is being adopted more frequently by developers to create various applications as if it were the foundational layer for Bitcoin. Notable projects such as Bioniq, Dopamine Finance, and Taler DAO are already operational on this network, while Omnity is planning its launch within this month.
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2024-04-16 16:32