Radix and Copper Bring a Tokenized World to the Radix Network
Originally posted 5th August 2020 Radixdlt.com/blog
To create the first layer-1 protocol designed specifically to meet the needs of decentralized finance, Radix has worked for years to create the most scalable public network technology for DeFi apps, culminating in our Cerberus consensus protocol.
But simply building the platform isn’t enough. The essence of decentralized finance is the free interchange of digital assets. Our vision is for Radix to be the universal marketplace of digital assets, and that means we need to help build the roads and bridges for people to bring all existing token assets to market. Radix is partnering with Copper to build that solution for Radix DeFi developers and users.
Copper has an extensive list of tokenized assets they already provide custodianship such as : Alogrand, Aeternity, SingularityNet, Bancor, Binance, Golem, Ethereum Classic, Kyber, Chainlink, Lisk, Iota,… click here for a full current list.
Digital Asset Bridges Through Wrapping
Our goal is to bring the world’s tokenized digital assets to Radix. Whether the tokens are cryptocurrencies, fiat-backed stablecoins, utility tokens, governance tokens, synthetic assets, or others — to bring them to the Radix marketplace, they must be translated from their home blockchain into a Radix-native token.
Technically this takes the form of “wrapping”. If we want to wrap a Bitcoin onto Radix, we must somehow lock 1 BTC in place on the Bitcoin network and then mint 1 Radix-native rBTC token. Unwrapping works the same way in reverse, burning 1 rBTC and releasing the locked 1 BTC to the user. With the ability to wrap and unwrap in this way, we’ve created a digital asset bridge between the two blockchains. It sounds simple, but moving value securely between fundamentally different blockchains is a longstanding challenge.
The best solution would be if anyone could quickly, frictionlessly, and confidently wrap any token on any blockchain onto Radix. They would simply send the original tokens to a special address and provide the Radix address to receive the wrapped token. The result would be so seamless that many token holders would prefer to keep all of their various tokens side by side in wrapped form in their Radix wallet — all freely usable in Radix DeFi applications.
Radix’s partnership with Copper gives us all the tools we need to provide a low-friction Wrapping Service quickly and securely.
Working with Copper, the Radix Wrapping Service will be able to bridge the greatest possible number of tokenized assets onto Radix soon after launch of the Radix public network. Copper provides custody of an impressive and expanding range of digital assets, all insured and held with the highest security standards. This means we can confidently use Copper’s custody platform as the reserve that guarantees the value of Radix-compatible wrapped versions that we will issue. Every one of Copper’s currently supported tokens, and those they continue to add to their platform, opens another gateway from that blockchain to the Radix DeFi ecosystem.
Copper also provides the compliance standards that many institutional token holders require and will be able to offer specialized services for individuals or organizations that wish to use Radix tokens within custodial wallet and exchange trading services. This creates a solid piece of institutional infrastructure for Radix as a finance platform.
Also, with Copper already announced as our listing partner for the Radix ERC20 token, that token can become much more than a typical redemption ticket for the Radix mainnet utility token. When the Radix public network launches, all ERC20 tokens on the Ethereum network will automatically become wrapped versions of the native Radix token that can flow back and forth through the wrapping service. The wrapping service becomes a 2-way bridge for the native Radix token and its ERC20 wrapped version that can participate in Ethereum’s current thriving DeFi ecosystem.
Looking ahead, Copper shares Radix’s dedication to the principles of decentralization. Copper’s current platform gives us the highest standards of security today, and together we will explore emerging methodologies to create trustless reserve backing systems that meet that same high standard.
The Radix Wrapping Service will open the first link from the wider world of tokenized assets to the Radix marketplace. Radix token buyers will have direct access to today’s Ethereum apps; users of Radix will have direct, seamless access to the world of crypto, fiat, and other tokenized assets; and the first DeFi applications to be built on Radix can have the confidence that they will have access to the liquidity that is the lifeblood of decentralized finance.