‘No bridges or wrapping’ — dWallet and Avail are building native Bitcoin rollups

Bitcoin (BTC) users will soon be able to access smart contract functionality without having to bridge, wrap or relinquish control of their BTC through a new integration between dWallet Network and Avail.

The partnership will enable dWallet’s smart contracts, built on Avail’s data availability solution, to create Bitcoin signatures for the first time while maintaining a user’s complete control of their BTC.

Speaking to Cointelegraph, dWallet co-founder and CEO Omer Sadika said the Bitcoin rollup solution would interact with native BTC without bridging or wrapping, which by design has created considerable incentives to hack or collude to exploit:

“Cross-chain solutions like bridges or federated MPC are broken because users must sacrifice their ownership to use them by giving away their BTC. Since the ownership is transferred, a collusion or hack could easily drain the assets. This issue already results in billions of dollars stolen.”

Related: Bitcoin needs to address scaling as ETFs drive momentum

Sadika adds that the Bitcoin community has long been hyper-critical of Bitcoin rollups or “layer-2s,” with many solutions slammed for “affinity scamming” by duping users into bridging or wrapping BTC in exchange for other tokens. 

Jameson Lopp, co-founder and chief technology officer of Bitcoin custody firm Casa, recently highlighted that nearly 30 Bitcoin layer-2 protocols are being tested.

Source: Jameson Lopp

It is a fact that Sadika has aimed to address with the integration with Avail. He claims that dWallets enable programmable native BTC where a user signature is cryptographically required.

“All existing Bitcoin rollups or L2s are using cross-chain solutions like bridges or federated MPC, violating the most sacred principle of Web3 and specifically of Bitcoiners — user ownership.”

Multi-party computation (MPC) is at the core of this functionality. MPC is a set of cryptographic protocols that let multiple parties compute a function together without revealing their inputs to each other.

According to Sadika, a wallet operating on the decentralized MPC dWallet Network can generate a Bitcoin transaction. To do so, a smart contract on an Avail rollup is needed to approve the transaction as well as the user signing for the Bitcoin transaction.

Related: Bitcoin block art? Marathon showcases visualization potential of block building

He explains that the smart contract on an Avail rollup can enforce any logic, including custody, swapping, lending or staking. Sadika adds that the user’s participation cryptographically guarantees that no one can collude or hack and steal the user’s assets:

“The fact that the dWallet generates a Bitcoin signature means the logic will be enforced on native BTC on Bitcoin and not using a representation of BTC, like wrapped tokens.”

The collaboration promises to use dWallet’s MPC infrastructure to broaden Bitcoin’s capabilities by enabling the creation of native rollups. Sadika says this will allow smart contracts to run any logic and utilize native BTC as part of the smart contract without bridging or wrapping tokens.

“So any DeFi [decentralized finance] protocol like swapping or lending can now utilize native BTC. Other use cases such as staking native BTC, DAOs [decentralized autonomous organizations] controlling native BTC, trading a portfolio of ordinals, or gaming can now include native BTC,” Sadika adds.

Related: Bitcoin halving will be a litmus test for inefficient ops: Mining execs

Anurag Arjun, co-founder of Avail, adds that allowing BTC to be used programmatically on other blockchains via a trust-minimized approach is a novel approach to driving Bitcoin adoption.

“Bitcoin represents a superb base layer from the data availability perspective, with the highest security available in the ecosystem,” Arjun said.

DWallet technology allows a Solidity smart contract on an Avail rollup to create Bitcoin signatures and enables developers to manage a dWallet.

Meanwhile, the dWallet Network mandates approval from the Avail rollup smart contract for logic enforcement, requiring users to finalize the signature to prevent collusion and asset theft.

Magazine: Big Questions: How can Bitcoin payments stage a comeback?

Also Read More: World News | Entertainment News | Celeb News

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Hong Kong spot crypto ETFs debut tomorrow: 6 things to know

The cryptocurrency community is eagerly awaiting a significant industry event happening tomorrow:…

Crypto miners face energy refusal, restriction in Canadian provinces

The Canadian province of Manitoba has extended a moratorium on new requests…

Ethereum ‘speculatory divergence’ sees ETH price cling to $3K support

Ethereum’s Ether (ETH) has “underperformed” compared to Bitcoin (BTC) this cycle, and…

Liquid staking on BNB Smart Chain, millions stuck in DeFi bridge contracts: Finance Redefined

Welcome to Finance Redefined, your weekly dose of essential decentralized finance (DeFi)…