Osmosis DAO backs zero-fee Bitcoin bridge to Cosmos Osmosis DAO backs zero-fee Bitcoin bridge to Cosmos
Osmosis co-founder Sunny Agarwal hailed the proposal as a major milestone in DAO-to-DAO deals.
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Updated: Jun. 21, 2024 at 7:41 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Osmosis Decentralized Autonomous Organization (DAO) is unanimously supporting a proposal to adopt a revenue share proposal that enables a zero-fee Bitcoin bridge to the Cosmos ecosystem via Nomic.
The proposal has received overwhelming community support, with about 92% of DAO members favoring the zero-fee upgrade. Meanwhile, around 6% of the DAO members abstained from voting, while 1% were against the move.
Voting will end by 23:58 UTC on June 21.
If approved:
“Osmosis users will no longer be charged bridging fees or transfer fees for nBTC transactions between Nomic and Osmosis. This mechanism will be implemented through a future software upgrade if approved by both Nomic and Osmosis governance.”
The initiative sets a new precedent in bridge business models. Traditionally, bridges have struggled to capture value directly from deposits and withdrawals. The Osmosis upgrade addresses this issue by aligning Nomic’s protocol revenue with the actual usage of its Bitcoin bridge.
According to the post:
“This proposal signals the addition of a protocol revenue share system that will replace these bridging costs with a share on taker fees gathered from trading activity on Osmosis, resulting in Nomic benefiting from increased adoption of nBTC across applications on Osmosis rather than just arbitrage against the value of native Bitcoin.”
The user-centric upgrade is expected to enable users to leverage their Bitcoin holdings for DeFi activities on Osmosis, such as lending, borrowing, and staking. It also integrates Bitcoin into the broader DeFi ecosystem, attracting new and existing users.
Osmosis co-founder Sunny Agarwal hailed the proposal as a major milestone in DAO-to-DAO deals. He stated:
“[The proposal] It provides a new ‘rev share’ business model for bridges, one that is uniquely possible with appchains (its hard to replicate this in generalized blockchains).”
The development follows significant growth in the trading volume on Osmosis in the fourth quarter of 2023. According to Messari, the DEX saw a 6x increase in trading volume on a quarterly basis, exceeding $5.3 billion.
The surge was attributed to the introduction of new features like volume-splitting incentives, recalibrating epoch incentives, targeting liquidity towards high-traffic areas, and introducing lower-fee pools.
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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Cosmos is a blockchain ecosystem where thousands of dApps interoperate to create the foundation for a new token economy.
Osmosis
$0.47364
OSMO is the token of the Osmosis Hub, first DEX for IBC connected coins built on the Cosmos SDK.
Sunny Aggarwal, renowned as the Co-Founder of Osmosis Labs, plays a pivotal role in the development of Osmosis, an application-specific blockchain (appchain) that serves as the decentralized finance (DeFi) hub within the Cosmos ecosystem.