Flare Labs Bring Smart Contracts to Bitcoin, Doge on Testnet

Flare’s FAssets system is tested to bring Bitcoin and Doge into the smart contract ecosystem, to expand their DeFi applications.

Man walking with colourful digital smoke coming out of his hands.
Created by Gabor Kovacs from DailyCoin
  • Flare Labs begins FAssets testing on the Coston network.
  • FAssets Enables non-smart contract tokens to interact with smart contracts.
  • Plans for mainnet launch after trials on Coston and Songbird networks. 

Despite their immense popularity, many of the most popular tokens, including Bitcoin (BTC), Dogecoin (DOGE), and many others, lack smart contracts. This prevents them from participating in the growing decentralized finance (DeFi) ecosystem. 

Multiple initiatives have sought to bring more functionality to these networks to bridge that gap.  Most recently, Flare Labs launched a testnet that will eventually allow these tokens to interact with smart contracts on the Flare network. 

Flare’s FAssets Testing: Bridging Bitcoin and Doge to DeFi

On Tuesday, November 28, in Dubai, Flare Labs initiated the testing of its FAssets system on the Flare network’s Coston testnet. The move marks the first step in integrating popular cryptos, like Bitcoin and Dogecoin, into DeFi. 

The core of this integration lies in the FAssets system. It is designed to allow the minting of non-smart contract tokens into FAssets, which can interact seamlessly with smart contracts on the Flare network. This process effectively enables DeFi applications, enabling users to earn yield or rewards with these assets. 

Hugo Philion, Flare Labs’s CEO, emphasizes this development’s transformative potential. He notes that 70% of blockchain assets currently lack smart contract capabilities, limiting their deployment in DeFi. 

Flare Will Reward FAssets Users

Flare Labs will launch the FAssets functionality on the mainnet after several stages of testing. The initial phase takes place on the Coston testnet, focusing on basic functionality and seamless integration. The subsequent phase shifts to the Songbird canary network, simulating real-world scenarios and stress tests. 

Once FAssets are operational on the Flare mainnet, users and dApps can earn FLR tokens from a cross-chain incentive pool, encouraging their participation and contribution to the Flare network.

On the Flipside

  • Integrating Bitcoin and Dogecoin into DeFi through FAssets could introduce new levels of volatility to these already fluctuating markets.
  • As with any new blockchain technology, there’s a risk of undiscovered vulnerabilities within the FAssets system. Ensuring robust security measures and continuous monitoring for potential exploits will be essential for maintaining user trust and system integrity.

Why This Matters

The introduction of FAssets by Flare Labs is a significant step forward in blockchain technology. It bridges the gap between traditional cryptocurrencies like Bitcoin and Dogecoin and the rapidly evolving DeFi sector. 

Read more about recent developments on Flare: 
How Flare and Etherspot Could Make Blockchain Easier to Use

Read more about Solana’s DeFi surge:
Solana’s DeFi Ecosystem Hits New Yearly High With $655M TVL

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
David Marsanic

David Marsanic is a journalist for DailyCoin who covers the intersection of crypto, traditional finance, and government. He focuses on institutionalized crypto entities like major cryptocurrency exchanges and Solana, breaking down complex topics into easy-to-understand writing. David's prior experience as a business journalist at various crypto and traditional news sites has enabled him to maintain a critical approach to news while adhering to high journalistic integrity standards.