BitDSM
The first in-kind Bitcoin on Ethereum
BitDSM is an open-source protocol that enables liquidity in cold wallets contribute to on-chain financial applications without change in beneficial ownership. It allows Bitcoin Hodl'ers create and redeem in-kind remap on Ethereum, instead of minting an ERC-20 or introducing a bridge.
The protocol introduces BitcoinPod (BOD), a smart contract which separates custody of the assets from the validation logic of the app.
This enables:
Validators restake BTC on Ethereum from other Bitcoin staking protocols. With BTC staked already to other chains, validators can create in-kind remap by setting their unbonding address to a BOD. This allows for either restaking to Eigenlayer AVSs or leveraging Bitcoin liquidity in financial applications.
Application developers enforce arbitrary slashing conditions on native Bitcoin BitDSM allows developers to enforce application specific liquidation or slashing logic on native bitcoin, which can be triggered directly from the ethereum smart contracts and executed on the BitcoinPod.
Institutions like ETF issuers to get altcoin exposure with native Bitcoin staking. Since the ETF funds cannot leave the custodian, this enables ETF issuers to offer BTC staking without altering the beneficial ownership of the funds or incurring counterparty risk through a multi-party multisig arrangement.
Custodians offer in-kind Bitcoin to retail customers Bitcoins with custodians today typically reside in some version of a 2-of-3 setup with the client. BitcoinPods can mobilize these funds without altering custodian's current infrastructure.
Retail users to leverage Bitcoin without giving up control With the prominent HODL culture among Bitcoiners, it becomes easier to unlock Bitcoin sitting in cold wallets when there’s no need to give up control.
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