SINOVATE enters the DeFi paradigm: Bridging with Ethereum (ETH) and Binance Smart Chain (BSC)
SINOVATE revolutionizes the decentralized Cloud space by implementing cutting-edge blockchain and data management technologies. The journey starts with deterministic Infinity Nodes (DIN) for ensuring a reliable infrastructure to welcome blockchain-based data storage. Then, SINOVATE decided to implement a hybrid consensus protocol with Bitcoin Core update for block validation to reinforce its security, efficiency, and scalability. Finally, the last milestone is to offer InfiniteChain for expanding its ecosystem and solutions powered by the SINOVATE blockchain. These components set a fundamental basis for developing and achieving a novel, user-friendly, and efficient dCloud environment for storing the data all around the data.
These improvements and technological achievements require a new audience who must invest in and use the infrastructure. Decentralized Finance (Defi) impacts cryptocurrency and global finance by allowing a more flexible, universal, and decentralized contribution to cryptocurrency projects. In this direction, SINOVATE decided to bridge its mainchain with Ethereum (ETH) and Binance Smart Chain (BSC).
What is decentralized finance (DeFi)?
Decentralized Finance (Defi) emerged in 2018 with the expansion of the Ethereum ecosystem. By exploiting the smart contract technology, this blockchain-based finance is an investment intermediary for users which does not rely on central authorities, exchanges, or systems. A smart contract connects participants with the support of decentralized applications (dApps) such as Metamask or Trust wallet. These dApps will allow the participants to interact with the blockchain, which hosts the smart contract and perform transactions. A blockchain and a dApp are the only components of a successful Defi system.
DeFi becomes a revolutionary and mainstream subject in 2020 by the multiplication of lending platforms known as yield farming. Today, DeFi is an unavoidable financial alternative for many users and newly created crypto projects. It becomes a vital component of the next decade’s cryptocurrency expansion.
How does SINOVATE bridge with ETH and BSC?
As previously said, DeFi operates “mainly” with a smart contract hosted by a blockchain. On the other hand, bridging SINOVATE with ETH and BSC is fundamentally a smart contract that enables a transaction operation from one blockchain to another. This is possible by creating a wrapped token by the smart contract of ETH or BSC.
A wrapped token is pegged to the value of its original cryptocurrency. One wrapped token is currently equivalent to 1 original coin or token and is mainly minted by the smart contract. User A must send the original token/coin to the smart contract, which mints the wrapped token on ETH or BSC and distributes it to user A. To reverse the process, user A needs to make a burning request of the wrapped token to the smart contract and receive back its original token/coin.
You can find more information here:
How can a wrapped token be used?
The bridge connects SINOVATE with ETH and BSC ecosystems, where ETH and BSC have their own wrapped token. However, a wrapped token is limited to the transactions and usage on the ETH and BSC network and dApps. This means you cannot use a wrapped SIN as a SIN coin directly on the SINOVATE blockchain for staking, building your Infinity Node, or storing your data. Inversely, the SIN coin is not an ERC-20 or BEP-2/BEP-20 token; therefore, SIN coins cannot be used on these blockchains.
Hence, SIN coins are dedicated to the SINOVATE ecosystem, and the wrapped SIN on ETH and BSC can be used in these ecosystems. Nevertheless, SINOVATE believes dApps will exploit this bridge to create multi-chain-based solutions. Future SINOVATE-oriented dApps will use either the SIN coin or the wrapped token to satisfy data storage or uses in ETH and BSC environments. This will enable the improvement of the scalability, efficiency, and security of the SINOVATE dCloud ecosystem. This bright future vision shows the wrapped token could have the same usage as the SIN coin with transparent and user-friendly dApps.
What are the benefits of SINOVATE?
DeFi has become a significant component of the cryptocurrency ecosystem. SINOVATE believes users and contributors must have easy access to its dCloud ecosystem, services, and applications. Its usage is highly dependent on the possibility of future contributors and users getting SIN coins in their portfolio and using it. Bridging SINOVATE with ETH and BSC will allow users of these ecosystems to enjoy SIN coins and their usage.
SINOVATE DAO wants to offer a sustainable and user-friendly environment by integrating the SIN coins in the decentralized exchange (DEX) platforms using automated market makers (AMM). To do this, DAO SINOVATE explores the elaboration of liquidity pools on the DEXes of ETH and BSC to ensure SIN pairs’ straightforward trading and sustainable revenue for SINOVATE ecosystem development. The list of possible DEXes is here:
More information about liquidity pool and providers are also here:
The last benefit is the connection of the SINOVATE mainchain with ETH and BSC provides a broader audience that will discover all the benefits of SINOVATE technologies. This will open the gate to further partnerships and the development of financial and data storage dApps backed by SINOVATE technologies.