tBTC (tBTC)

Proposed GM Markets
1

Symbol: tBTC

Token Address: 0x6c84a8f1c29108F47a79964b5Fe888D4f4D0dE40 (Arbitrum)

Listing Chain: Arbitrum

Summary

GMX is renowned as a decentralized spot and perpetual exchange, but with over 123M USD of WBTC supplied as collateral in GM pools, there is a significant centralization risk to users of GMX. Threshold Network understands the importance of censorship resistance within GMX, and are closely aligned to the same core principles. Until recently, there wasn’t a decentralized BTC option available on Arbitrum. tBTC has successfully filled this niche, which is why we propose the addition of a GM:tBTC/USDC Arbitrum pool.

Useful Links

Project: https://www.threshold.network/

Minting dashboard: https://dashboard.threshold.network/tBTC/mint

GitHub: GitHub - keep-network/tbtc-v2: Trustlessly tokenized Bitcoin everywhere, version 2

Docs: tBTC Bitcoin Bridge | Threshold Docs

Audit: About

Immunfi Bug Bounty: Threshold Network Bug Bounties | Immunefi | Immunefi

Llama Risk Report: Collateral Risk Assessment: Threshold BTC (tBTC) - HackMD

Twitter: x.com

Discord: Threshold Network ✜

Dune: https://dune.com/threshold/tbtc & https://dune.com/sensecapital/tbtc-liquidity

Arbitrum Chainlink Price Feed: 0xE808488e8627F6531bA79a13A9E0271B39abEb1C

What is tBTC

tBTC is a decentralized wrapped Bitcoin that is 1:1 backed by native BTC. Unlike other wrapped Bitcoins, tBTC can be permissionlessly minted and redeemed, which creates a direct connection between Bitcoin and EVM. The BTC that backs tBTC is held by a decentralized network of nodes using threshold cryptography, rather than a centralized intermediary.

tBTC is fully programmable and can be used as collateral, liquidity, a store of value, or integrated with DeFi apps across all supported blockchains. Furthermore, direct BTC->Arbitrum minting will soon be enabled via the tBTC SDK.

tBTC is canonically deployed on Arbitrum and has tBTC contracts natively deployed. This contract has mint/burn functions maintained by the Threshold Council. Interchain protocols can be added or removed from the contract permissions. Wormhole is currently the only interchain communication protocol that is approved on the Arbitrum tBTC contract.

  • Since launching the full 2-way BTC bridge in August, tBTC has scaled to 9 chains beyond Bitcoin.
  • tBTC is the only fully permissionless BTC bridge.
  • MCAP increased from 85m to 225m in 3 months.
  • Used as collateral for crvUSD.
  • About to go live on Aave.
  • Becoming the go-to bridged Bitcoin on Bitcoin L2’s with 706 BTC on Mezo and 229 BTC on BOB, with more partnerships incoming.

What is Threshold Network

tBTC was created by a decentralized effort of contributors at the Threshold Network DAO, and extensively utilizes the Threshold Network’s threshold cryptography to create a secure BTC asset. tBTC is a product launched on Threshold Network, on which many other decentralized applications are being built.

Threshold Network DAO was born out of the first on-chain merger between two decentralized protocols, Keep Network and NuCypher early in 2022. The DAO has successfully operated since that time, and supports an active community of contributors that work towards building tBTC liquidity and usability.

Benefits to GMX

  • Further decentralization and trust minimization in the GMX stack.
  • Direct BTC on and off-ramps to GMX products via tBTC SDK.
  • Co-incentives to boost BTC TVL on GMX via $T and $ARB incentives.
  • Arbitrum LTIPP - with the approval of tBTC’s LTIPP (Snapshot), tBTC on Arbitrum will see:
    • An improved user experience to getting tBTC on Arbitrum with Native minting.
    • An increased liquidity profile through long-term incentives.
    • A higher APR for BTC liquidity providers through Threshold’s 20,000ARB grant to be used for lending protocols on Arbitrum.
  • Preferable yields on BTC through active incentive participation, boosting GMX TVL.

Incentives Program

Threshold DAO commits to a three-month incentive program to bootstrap tBTC collateral deposits on GMX.

Month 1
$15k USD denominated in $T
6,666 ARB

Month 2
$15k USD denominated in $T
6,667 ARB

Month 3
$15k USD denominated in $T
6,667 ARB

Once this launch program is completed, Threshold DAO will review the success of the campaign and assess an ongoing incentives budget.

tBTC Growth Stats

MCAP: 225,000,000 - https://dune.com/threshold/tbtc

Daily Volume:

618×541 21.5 KB


https://dune.com/sensecapital/tbtc-liquidity

Coingecko Link: https://www.coingecko.com/en/coins/tbtc

Oracle Status:

Chainlink supports a data streams oracle for tBTC: 0xE808488e8627F6531bA79a13A9E0271B39abEb1C

Parameters

To be completed by security committee.

Next Steps

Move to Snapshot vote after forum discussion.

2

Thank you for the proposal @Ethan

2 Likes
3

I like tBTC from a principles standpoint. GMX should generally always be looking to minimise centralised dependencies.

Good to see that TVL is increasing and you’re getting traction on many blockchains too.

1 Like
4

There will be a segment of people who prefer to trade tBTC over wBTC. I see no problems with giving traders more options, the added incentives should help attract some liquidity to bootstrap.

1 Like
5

Thanks for the proposal!

Moving away from centralised risks are ideal, but my only concerns would be fragmenting liquidity in the BTC pools but i should think this coinciding with the GMX STIP.b incentives across GM pools will mitigate this risk.

I see in the attached dune that since its deployment in curve there has been a ~50% increase in the amount of tBTC parked there, so it would be fantastic if the results could be replicated.

Do you happen to know what/where the primary liquidity pool on arbitrum is? It would be great if the proposed gmtBTC market could become that for tBTC, as it currently is for gmBNB and wBNB.

2 Likes
6

How will the security of the decentralized network of nodes holding BTC collateral be ensured in the long term?

3 Likes
7

100% agree, that’s why we decided to put together a pretty comprehensive incentives package over the first three months, with scope to extend

We plan on distributing incentives to the following pools:

  • Curve tBTC/WBTC will get ~93k ARB + T
  • Uni tBTC/ETH will get ~35k ARB + T
  • Uni tBTC/WBTC will get ~70k ARB + T

So we’re likely to see inflows to the Curve pool primarily, helping GMX users access better liquidity to trade between the BTC pairs.

1 Like
8

Great question, so nodes that help secure the network receive ~15% yield on their T token (Threshold Network Token), creating incentive to continue running the nodes. We also have active overview of these nodes ensuring that they’re always up and operational.

We also have multiple audits and a bug bounty program. About & Threshold Network Bug Bounties | Immunefi | Immunefi

If you want to go into the specifics of wallet security there is a pretty comprehensive explanation that can be found here - Wallet Generation | Threshold Docs

1 Like
9

Understood, thanks for the explanations!

1 Like
10

Want to learn more about tBTC? Listen to the recent community call:

https://x.com/i/spaces/1vAGRvOMROgGl

2 Likes