All news is rigorously fact-checked and reviewed by leading blockchain experts and seasoned industry insiders.
Decentralized finance needs to become more accessible in order to attain more widespread adoption, and blockchain interoperability is often seen as one of the major obstacles preventing this.
Because blockchains are not interoperable, they cannot talk to each other, which prohibits the transfer of value between them.
Take the example of Bitcoin and Solana, two of the biggest decentralized networks of all. They’re separate blockchains, and each one has its own currency – Bitcoin has BTC, Solana has SOL – and as it stands, it’s impossible for a Bitcoin wallet to send or receive funds from another on Solana, and vice versa.
In other words, they’re living in two distinct worlds, with their own ecosystems of Web3 applications, and although they both have billions of dollars in capital locked up, those funds cannot flow from one app to another.
It’s a state of play that needs to change, and it’s leading to a lot of innovative development. Zeus Network, for instance, is making waves with its efforts to bridge the gap between Bitcoin and Solana, so users can more easily transfer BTC into the Solana DeFi ecosystem. In doing this, it’s boosting the utility of the world’s most valuable cryptocurrency, making it more relevant.
The Need For Interoperability
Building interoperability between blockchains has long been a major goal of crypto developers, because it will solve one of the biggest areas of confusion for new users. Most newcomers don’t understand that Web3 is built on lots of different networks and that they must use separate wallets and tokens to interact with each one. It can cause problems with lost funds – such as if someone tries to send BTC to a Solana or Ethereum address, those funds may just disappear into the ether, never to be recovered.
Another major challenge is liquidity fragmentation, which can inhibit the growth of decentralized applications. A dApp built on Solana, for example, can only attract funds that live on the Solana network – without some kind of mechanism to span the gap, it can never access the trillions of dollars in value held on Bitcoin, limiting its potential.
Cutting Out The Custodians
This is where Zeus Network comes into play, having built a novel architecture that bridges the gap between Bitcoin and Solana, allowing for funds to traverse between them with unprecedented ease.
The key to Zeus’s interoperability protocol is the ZeusNode, which refers to a collection of decentralized nodes that ensures seamless Bitcoin-to-Solana transactions. Unlike a network bridge, where users are required to send funds to a custodian in order to mint a different type of token on the target network, Zeus utilizes a permissionless architecture, allowing funds to be sent from Bitcoin to Solana and vice versa in a decentralized way, without custodians or permissions.
The ZeusNode plays the important role of validating transactions through its network of Guardians, which are tasked with overseeing the network and ensuring no malicious activity occurs.
Another key component is the Zeus Program Library, which facilitates the process of funds crossing from one network to another. It enables the creation of digital assets that live on both networks at the same time. When someone moves BTC to Solana via Zeus, the BTC is locked up via the Zeus Program Library so it cannot be used on the Bitcoin network until sometime as it’s transferred back. In the meantime, the bridged funds become accessible as zBTC on the Solana network, with 1 zBTC pegged at 1 BTC.
It’s a superior alternative to the use of custodians, which has held back the adoption of most earlier blockchain bridge mechanisms. For instance, when creating wBTC that lives on Ethereum, users are required to store their BTC with a centralized custodian – a company called BitGo. This means putting your trust in the hands of that company, which goes against the very ethos of decentralized money and is an unattractive concept for many crypto purists.
The process works differently with the Zeus Program Library, where the community of decentralized and independent nodes essentially share custody of the locked BTC. This mechanism ensures that no one is able to control those funds, other than the person who first locked them up, and that person can only unlock them when they burn the zBTC they minted on Solana. Smart contracts help to automate the process, making everything permissionless and trustless.
The locked up BTC is protected by Zeus’s Guardians, who perform this task in addition to their role as transaction validators.
By using Zeus to mint zBTC, it becomes possible to use Bitcoin directly with a vast range of DeFi applications on the Solana platform. That’s a powerful incentive for Bitcoin holders, as Solana is home to some of the most lucrative DeFi apps around, with platforms like Jupiter, Jito, Raydium and Marinade Finance providing utility such as lending, borrowing, utility provision and staking. By accessing Solana-based DeFi, Bitcoin becomes a yield-generating asset, as opposed to serving as a simple store of value.
Breaking Down Barriers
For Solana’s dApp developers, the possibilities entailed by Zeus are only just starting to be explored. It’s a novel interoperability solution that allows them to tap into the unmatched liquidity available in the world’s number one cryptocurrency, while retaining the benefits of operating on Solana’s powerful infrastructure.
Zeus’s permissionless Bitcoin to Solana bridge promises to set a new standard for blockchain interoperability, leapfrogging a major barrier to adoption and leading us into a future of interconnected Web3 networks that remain truly decentralized.
