This heading was posted on the Reddit platform recently, Bitcoin cash now on Ethereum, what benefit can this bring to Bitcoin cash? Knowing the nature of Ethereum, it will be right to say if this can give value to Bitcoin cash, but we cannot understand it without taking a proper look at the project spearheading this invention, a thorough research was undertaken to know what the project is all about.
The name of this project is called RenVM, a versatile decentralized, trustless, and permissionless custodian that holds digital assets and move them between blockchain. The operation is that a user gives BCH to RenVM, it holds that BCH, and it mints it as an ERC20 with the ticker "renBCH" on Ethereum with a 1:1 ratio to ensure your renBCH is always backed by the same amount of BCH. RenVM is a system that allows you to move your asset across blockchain seamlessly and quickly at a 1:1 ratio without swapping to other assets. This process is the same for all cross-chain assets. This system currently supports three different assets namely Bitcoin, Bitcoin cash, and Zcash, bringing them to Etherium blockchain.
The technical understanding of this system is that it is a minting process. Any asset sent to RenVM is minted on Ethereum on 1:1 ratio backed ERC-20. The equivalent amount of BCH you send to RenVM Bitcoin cash address is what you get in renBCH and also be redeemed for BCH back at the same ratio at any time. To mint BCH on Ethereum, lock BCH on renVM then mint renBCH on Ethereum.
What does this brings to Bitcoin cash?
1. Enable the use of BCH on any Defi project
Defi projects require ERC-20 tokens on Ethereum, rather than swapping or exchanging BCH to any ERC-20 token before deploying it on a Defi project it seems easier to send BCH to RenVM to mint renBCH on Ethereum without losing its Bitcoin cash value. You can again redeem your BCH back anytime you are done with your Defi project through the same medium.
2. It enables the use of BCH on an Ethereum smart contract
As it is, most smart contracts are built on the Ethereum blockchain. Accessing these smart contracts entails you have to exchange your BCH for Ethereum on exchanges before deploying it for an Ethereum smart contract. However, with RenVM all you need to do is simply send your BCH to RenVM Bitcoin cash address and mint renBCH at an equivalent amount quickly and seamlessly. With this, your BCH can now work perfectly on any Ethereum smart contract.
Here is the hook!!
As with Ethereum, so it is with RenVM. The gas fees are there to bear, and you know how high it can be. Knowing what Bitcoin cash represents in terms of transaction fees it is left to anyone to decide if this system worth the try. Can you bear the gas fees for minting and redeeming your BCH, then RenVM is all to your advantage.
Note: You do not don't get the value of Etherium for BCH minted to renBCH. The value remains the same across blockchains.
Nonetheless, there is a feature renVM called RenTokenomic where users acquire darknodes to earn passively every month. Each darknodes cost 100kREN to acquire. It simply a process of sending any other token like BTC or BCH to renVM and lock it up for as long as you can while earning passively from the network fees every month.
FULL DETAILS ON WEBSITE
