Key Takeaways:
- 21.co to integrate Chainlink’s Proof of Reserve technology into its 21BTC Bitcoin wrapper on Ethereum and Solana.
- Chainlink’s system will ensure real-time audits of reserves, addressing concerns over Bitcoin wrapper transparency.
- The move follows increased scrutiny of reserve practices for wrappers like Wrapped Bitcoin (WBTC) and cbBTC.
21.co, the parent company of 21Shares, announced plans to integrate Chainlink’s Proof of Reserve technology into its 21BTC Bitcoin wrapper on Ethereum and Solana.
This move addresses growing concerns over the backing of Bitcoin wrappers, offering cryptographic proof that newly minted tokens are fully backed by reserves.
.@21co__ has integrated Chainlink Proof of Reserve (PoR) on @ethereum & @solana to enhance reserves transparency for 21BTC, its wrapped Bitcoin.
— Chainlink (@chainlink) September 23, 2024
How PoR provides the Ethereum & Solana ecosystems with assurances that 21BTC is fully backed 1:1 by BTC👇https://t.co/kUqFTlofcJ pic.twitter.com/SD6UdG4ABV
Chainlink’s system will provide automated, real-time audits of both on-chain and off-chain reserves, ensuring transparency and preventing unauthorized minting.
The integration comes amid industry-wide scrutiny of Bitcoin wrappers like Wrapped Bitcoin (WBTC) and Coinbase’s cbBTC, particularly regarding reserve custody practices.
Recent controversies include BitGo’s decision to share control of WBTC’s multisignature wallet and BlackRock’s request for faster Bitcoin withdrawals for its iShares Bitcoin Trust.
Coinbase, a regulated custodian, has refuted rumors of not compensating cbBTC holders in case of a breach, while U.S. custodians face strict reporting and audit requirements to maintain transparency.
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