The tBTC dApp is the first application on Keep. With it, an individual can deposit Bitcoin in exchange for 1 TBTC, a 1:1 Bitcoin-backed ERC-20. Because it is Bitcoin on Ethereum, not the price of Bitcoin on Ethereum, this token allows Bitcoin to be used in Decentralized Finance (DeFi). Keep uses bonded ETH on the network validators as collateral to secure the deposited BTC. When the price of ETH and/or BTC fluctuates, the collateralization level does as well. If and when the BTC deposit is under-collateralized, a liquidation process begins for the ETH.
If you choose to bond ETH on Keep, it is critical to understand how collateralization and liquidation work, and what to do if a deposit you are securing becomes undercollateralized. The following is a short guide to the process and some actions you can take to monitor your ETH.
All prices in the diagrams below are examples. The ETH/BTC ratio is shifting because the price of BTC remains the same while the price of ETH drops.
The ETH falling-price auction seeks to sell part or all of the ETH bond in exchange for the exact amount of TBTC the bond originally collateralized. The original depositor is not involved in the auction and the results have no impact on her TBTC. An increasing amount of ETH is offered and the auction remains open indefinitely until someone purchases the bond.
Any ETH not collateralizing a TBTC deposit can be withdrawn at any time via the Token Dashboard. Any bonded ETH currently serving as collateral for TBTC can be withdrawn after you redeem the deposit.
Redeem the deposit:
All rewards for KEEP, ETH, and TBTC will be managed through the Token Dashboard.
To withdraw your rewards:
Bison Trails is a blockchain infrastructure platform-as-a-service (PaaS) company based in New York City. We built a platform for anyone who wants to participate in 25 new chains effortlessly.
We also make it easy for anyone building Web 3.0 applications to connect to blockchain data from 33 protocols with Query & Transact (QT). Our goal is for the entire blockchain ecosystem to flourish by providing robust infrastructure for the pioneers of tomorrow.
In January, 2021, we announced Bison Trails joined Coinbase to accelerate our mission to provide easy-to-use blockchain infrastructure, now as a standalone product line. The Bison Trails platform will continue to support our customers. With Coinbase’s backing, we will enhance our infrastructure platform and make it even easier to participate in decentralized networks and build applications that connect to blockchain data.
Contact us with questions about the Keep protocol or to get started running a Keep node.
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