Adding Bitcoin to the platform

Swerve can capitalize on this rapidly growing market by adding BTC pools early. Just like users exchange stablecoins for each other to get better rates on exchanges or use different dapps that support different versions of stablecoins, so will they do with different wrapped forms of Bitcoin.

Are we interested in getting such pools going? Should we make a formal proposal? I’m super excited about capturing a share of the immense market size Bitcoin swapping will have.

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I’m supportive of this motion. One thing that stands out to me about Swerve is its relative simplicity compared to Curve. Currently, we only offer a stablecoin pool, but I believe we can capture additional market share by offering BTC-based pools as well. The 2 largest BTCs on Ethereum are wBTC and RenBTC, so I believe we should start with at least those two.

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Agree, there is a growing demand for wrapped version of BTC. The liquidity it can bring might be a game changer long term. Currently the best and most known 2 solutions are WBTC (centralized) and renBTC (decentralized). These 2 are bringing around 100.000 BTC to Ethereum chain so should definitely be taken into consideration as a starting point.

And given SIP-13 sETH/wETH Pool, and the Golden Liquidity Pool Model obviously sBTC should be part of the potential future pool. Given that sBTC is one of the Bitcoin versions with less liquidity, could minting more sBTC be incentivized somehow? (https://btconethereum.com/)

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WBTC/renBTC/sBTC pool :white_check_mark:

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Swerve’s positioning as a more decentralized community fork could also be expressed in the choice of BTC tokens. WBTC and RenBTC are custodial setups that operate multi-sig wallets with few signers.

Projects like tBTC, pBTC and vBTC operate trustless bridges, not introducing counterparty risk.

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wBTC: I don’t see how you could seriously consider not having wBTC part of the liquidity pool in a decentralized exchange, it has the most liquidity, most integrations, most volume etc. If the goal is to compete with other protocols you can’t limit yourself at this stage (maybe down the line you could transition to a certain niche).

renBTC: since the Ren protocol is transitioning to a decentralized network that would be fine.

tBTC: probably fine to add it when it has enough liquidity, volume, and has been battle tested

pBTC: this asset has no liquidity and is custodied by a single node that their team controls, so not sure how you could claim that they are trustless. Their goal is decentralization but unclear roadmap to how they are going to solve that, and has much less traction.

vBTC: don’t know what this is, can’t find any info. If it isn’t in mainnet there is no point considering it yet imo.

If the goal is to compete with other protocols you can’t limit yourself at this stage

agree, i didn’t mean to avoid WBTC or Ren, but to diversify.

tBTC: is currently voted on in Curve already.

vBTC: is issued by strudel.finance and uses the same bridge infrastructure.

A little off topic, but I checked out vBTC and Strudle finance, and I can’t see how that is a good idea. Because vBTC can’t be used to redeem real BTC, the token is worthless honestly. Doesn’t matter that you provably burned BTC on Bitcoin mainnet (which seems very irresponsible). It’s not really BTC anymore, because it relies on the security of Ethereum and the implementation of the token, not on Bitcoin, so they are not 1:1 in the value sense, and they definitely do not share the same liquidity, because it cannot be redeemed back to native BTC, as the other wrapped BTC can.

true, liquidity is divided, as there is no way back for vBTC.

let’s say the token proves its value by other means, community governance, native flash loaning, no counterparty risk and holds the peg. what would be the effects listing it together with the other tokenized BTCs?

A one-way bridge will prevents effective arbing, making it harder to balance a pool if it had vBTC in it. And given the competitive “wrapping” scene with wBTC, renBTC, sBTC, tBTC etc. it’s going to be difficult for smaller projects/communities to gain significant adoption such that they are liquid enough for efficient stableswaps, that Swerve is meant to offer.