Cardano founder predicts growth in popularity of wrapped bitcoins

Charles Hoskinson stated that wBTC has much more utility

07.10.2022 - 11:15

649

2 min

What’s new? The founder of the Cardano network Charles Hoskinson said that wrapped assets tied to the price of bitcoin will spread with the speed of wildfire. In his YouTube video, Hoskinson predicted that in five years, most BTC will be in a wrapped state on other blockchains. In his opinion, wrapped bitcoin (wBTC) is “vastly superior” to regular bitcoin in utility.

Charles Hoskinson’s video

A wrapped token is a cryptocurrency whose value is pegged to another digital asset at a 1:1 ratio. Because of this, wrapped tokens can be transferred from the blockchain on which they were built to another network. Such coins support interoperability between blockchains and can be used in two or more ecosystems.

What else did Hoskinson add? The head of Cardano said that wrapped tokens have grown in popularity because they gave investors — in this case, bitcoin holders — the ability to use their assets and trade them in various decentralized applications (dApps) and smart contract platforms. He added:

“It’s important to understand that whether it be bitcoin living on the Bitcoin network or bitcoin living on another network, it still is bitcoin.”

Hoskinson also believes that such technology could also be used in government financial systems. In his opinion, it would actually give governments “a stable currency that they can use for daily transactions inside their ecosystem with a sound monetary policy.”

Earlier, the head of Cardano suggested shutting down the Bitcoin network, which operates on the Proof of Work (PoW) consensus algorithm, and moving all existing coins to other blockchains. He believes that all bitcoins already mined, which number more than 19 million, could be converted into wBTC on more energy-efficient smart contract platforms such as Ethereum or Cardano, which would expand its applications.

Author: