Cardano (ADA) creator Charles Hoskinson is unveiling his take on Bitcoin’s (BTC) value proposition as it increasingly becomes used in the realm of decentralized finance (DeFi).
Hoskinson believes “wrapped” coins that are pegged to the price of Bitcoin will spread like wildfire across a wide swath of smart contract-enabled blockchains.
Wrapped tokens have grown in popularity by essentially giving investors – in this case Bitcoin holders – a way to trade and utilize their BTC in decentralized applications.
“My prediction is that in five years’ time, the majority of Bitcoin will not be on the Bitcoin network but rather actually wrapped floating in other networks…
And that [wrapped] Bitcoin will be used in all kinds of DApps [decentralized applications] and smart contracts.
[It] potentially could even be used by nation-states to create a means of exchange in a unit of account to actually have a stable currency that they can use for daily transactions inside their ecosystem with a sound monetary policy.
It’s important to understand that whether it be Bitcoin living on the Bitcoin network or Bitcoin living on another network, it still is Bitcoin.”
Hoskinson says that wrapped Bitcoin is “vastly superior” to regular Bitcoin as wrapping the flagship crypto asset enhances its utility value.
“In practice, the users of the system are already putting it [Bitcoin] into the legacy financial system. At least by wrapping them in cryptocurrencies, you have self-custody and smart contract-based custody and all these other things.
It’s vastly superior to the way it’s currently being used with the infrastructure there.”
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