In early August, a little over two months ago, BitGo announced that it was entering a new joint venture with Justin Sun and BiT Global, a Hong Kong-based custodian, to manage custody for Wrapped Bitcoin (WBTC).

Sun’s involvement was controversial, leading some DeFi projects to briefly consider whether WBTC would remain safe going forward. The most high-profile of these, MakerDAO, did eventually decide it was still safe to include WBTC.

This period of time even included a less than fully viable proposal for competitor Threshold Network to acquire WBTC. 

Additionally, both Coinbase and Kraken have launched competitors to WBTC following BitGo’s announcement.

Read more: How involved is Justin Sun with WBTC’s new custodian BiT Global?

Since then, Coinbase’s version, Coinbase Wrapped Bitcoin (cbBTC), has seen the most rapid growth among the four charted competitors, vastly outstripping both Kraken Wrapped Bitcoin (kBTC) and Threshold Network Bitcoin (tBTC).

Despite the originally controversial change and an initial surge, burn requests have slowed for WBTC, and the appreciation in bitcoin’s price has allowed its market capitalization to grow more substantially than the growth of its competitors tBTC, kBTC, and cbBTC combined.

Additionally, BitGo has announced that two of the three keys will remain in its control, split between BitGo Singapore and BitGo Inc., with only a single key under the control of Sun-affiliated BiT Global.

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The post CHART: The growth of WBTC competitors appeared first on Protos.

Blockchains nearly always rely on testnets, kept separate from the ‘mainnet,’ to ensure changes to client software can be introduced safely. Bitcoin has a testnet and this testnet has its own currency, tBTC

Of course, tBTC and the entire Bitcoin testnet are supposed to be worthless. However, crypto’s embracing of degeneracy has transformed tBTC into a real, $25 million-and-growing asset backed by approximately one-third the hash rate of Litecoin.

Litecoin, a proof-of-work blockchain operating since October 2011, has a hash rate of approximately 1 petahashes per second. Testnet bitcoin has a hash rate around 0.36 petahashes per second.

For context, real Bitcoin has a hashrate of 678 exahashes per second. That is 678,000 times more mining security than Litecoin. So neither of these networks have anywhere close to the security of Bitcoin.

Note that Litecoin miners use Scrypt-based hashing which is distinct from Bitcoin miners’ SHA-256 hashing, so the comparison between hashrates is somewhat apples-to-oranges.

Nevertheless, Litecoin has a market capitalization of $5.7 billion while testnet bitcoin, which is also a proof-of-work blockchain, has a mere $25 million market capitalization.

Yes, real Bitcoin miners mine tBTC — with real electricity, for a real profit motive. Although tBTC is not listed on major secondary markets like crypto exchanges, over-the-counter dealers sell tBTC for as much as $1.26 apiece.

Runes and bitcoin testnet airdrop farmers

Many market observers attribute the growth of testnet bitcoin usage to so-called Layer 2s, which are separate blockchains related to a conventional blockchain like Bitcoin. Typically, layer 2s increase speed and throughput while reducing decentralization.

With the upcoming launch of Casey Rodarmor’s Ordinals successor Runes scheduled for Bitcoin’s halvening around April 19, many Bitcoin layer 2s are incentivizing testnet usage. Certain projects are promising airdrops or other incentives to ‘early adopters’ who use pre-release versions of software on testnet. Bitcoin users are creating testnet wallets and airdrop farming while practicing using Runes and other Runes-based meme coins, DeFi platforms, and NFTs.

Read more: Ordinals founder Casey Rodarmor to launch Runes at Bitcoin halving

It all adds up to a considerable amount of real value for an ostensibly worthless sandbox. With the price of tBTC increasing a few pennies seemingly by the day, the halvening date this week should mark an important milestone in the history of Bitcoin’s curiously valuable testnet.

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The post Halving excitement pumps ‘worthless’ bitcoin testnet appeared first on Protos.