Crypto teams are quietly exploring a new move. Instead of staying loyal to their native coins, some altcoin projects now look at Bitcoin as a long-term asset.
There is one of the several reasons that makes Bitcoin be considered as a great asset. This week a fresh proposal is being reviewed by the Polkadot community.
This implies converting 500,000 DOT into bitcoin over time using the dollar-cost averaging approach. The goal is to build a BTC reserve. The plan does not rush things and gives you twelve months to accomplish all this.
Bitcoin powers Polkadot, Cardano plans
The goal is clear, to use Bitcoin to back up Polkadot’s treasury and provide cryptocurrencies to DeFi pools. It is not just a conversation about holding Bitcoin alone. Developers want to make use of BTC, which is a wrapped Bitcoin token from Threshold Network. The 500,000 DOT at current prices might be around 18 BTC only. The strategy consists of the attribution of DCA’s rolling instrument to make the transition smoother.
After that, a part of BTC will be converted into Omnipool powered by Hydration. As it would serve the purpose of treasury diversification as well as DeFi incentives concurrently, this is imperative. At the same time, the founder of Cardano shared his vision on a similar path.
That is what he aims to do within Cardano with a wealth fund that is based on decentralized principles. The project directs about $100 million in ADA to the investing efforts. It breaks down guaranteed funds like USDA and iUSD, plus BTC. The fund could yield staking rewards, and then the profits will be reinvested back into the Cardano system.
Crypto teams rethink Bitcoin strategy
Through this vision, we can see that they are planning to provide support for BTC-based DeFi also. By providing added bitcoin liquidity Cardano could also expand into new spheres. Although the above may be only among the early-stage ideas, they nevertheless signify a paradigm shift. Nowadays the cryptoo teams that once competed with Bitcoin seek an opportunity to partner with it.
The shift may be understated, but it is there. People who trade in altcoins seem to feel about Bitcoin more than just a competition. They could now regard it as an essential asset that requires development rather than be defeated. However, this does not yet mean changing the whole strategy entirely.
But even mentioning Bitcoin in respect of one’s treasure shows something. Even though Bitcoin is always at the top, The position of cryptocurrencies in finance may not be limited to just being a store of value. It is possible that now it powers DeFi, even in the hands of its rivals from the past.
