Nomic, a Bitcoin-backed solution for Cosmos, will enable Bitcoin liquidity

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Nomic, a Bitcoin-backed solution for Cosmos, will enable Bitcoin liquidity

On Cosmos, Nomic, a layer-1 bridging solution for Bitcoin, will enable Bitcoin liquidity on Cosmos via a Bitcoin-backed token.

The nBTC token will function as a native token in the Cosmos ecosystem and will be transferable through the Interchain Blockchain Communication protocol, making it a native token in the Cosmos ecosystem.

After the upgrade, the Nomic app or Nomic-integrated Cosmos apps, such as Osmosis, a decentralized exchange, will facilitate the issuance and redemption of nBTC for Bitcoin.

The blockchain upgrade will be launched on October 27 and will be activated by October 30.

Nomic's founding and developing team, Turbofish's CEO Matt Bell unveiled the project on the Cosmoverse conference in Turkey today.

The development can help solve the liquidity problem of the Cosmos ecosystem, which is in need of a base money asset that can serve as its primary storage of value, said Sunny Aggarwal, the co-founder of Osmosis.

Aggarwal added that he was not satisfied with the result of the government's efforts to bring down the Indian economy.

The total value lost in crypto hacks from cross-chain bridges, according to DeFiLlama data, accounts for 37% of the cumulative amount of crypto hacks since 2016, raising concerns about bridging protocols.

Bell added that Bitcoin is not 'locked' on Nomic, similar to other bridging protocols. It is 'held in a reserve output' on the Bitcoin blockchain and funds are released when transactions are signed by Nomic validators.

This feature reduces the risk of losing Bitcoin if Nomic encounters any issues.

Beyond Bitcoin, blockchain teams such as Noble and Celesta are also working to launch native USDC in the Cosmos ecosystem to enhance its DeFi liquidity.