KuCoin AMA With Teleport System Token (TST) — Crafting the Future of Blockchain with Omni-Chain Protocols

Dear KuCoin Users,

Time: July 02, 2024, 12:00 PM - 01:23 PM (UTC)

KuCoin hosted an AMA (Ask-Me-Anything) session featuring the Co-founder of TeleportDAO, Mahyar Daneshpajooh, in the KuCoin Exchange 2nd Group.

Official Website: https://teleportdao.xyz/
Whitepaper: https://docs.teleportdao.xyz/

Follow Teleport System Token on X, Telegram and Discord

Q: Which blockchains does TeleportDAO connect to?

Mahyar: So, TeleportDAO is a light client bridge, connecting different blockchains tougher. Our main focus is on connecting Bitcoin to other EVM blockchains and Bitcoin Layer 2(s). So far, we built a Bitcoin bridge on Polygon, BNB chain and Bsquared. We also built the Ethereum bridge on Celo. We will expand our Ethereum bridge to other EVM blockchains soon.

Q: What role does TeleportDAO play in the Bitcoin ecosystem?

Mahyar: So, TeleportDAO connects Bitcoin to Bitcoin L2s and EVM chains in the most secure and decentralized way. We are the interoperability layer for Bitcoin, enabling bridging Bitcoin assets to other chains. This includes bringing BTC, Bitcoin tokens, and Bitcoin NFTs to other blockchains.

With the number of Bitcoin Layer 2(s) growing, TeleportDAO becomes more and more important. Users will need to move their assets from Bitcoin to these layers in a secure and decentralized way. TeleportDAO enables this by creating a connection between Bitcoin and these layers. Developers can use this connection to build cross-chain applications for Bitcoin.

Any application can use the TeleportDAO bridge to access Bitcoin transactions on other chains. So you can read Bitcoin data and build applications based on this.

Q: How does TeleportDAO's bridge differ from other blockchain bridges?

Mahyar: There are two main approaches in building a blockchain bridge: one is validator based approach, and another is light client approach. In validator based bridges, there is a group of validators who move data between chains. So here the security of a validator based bridge is equal to the security of the validator layer. If the number of validators is low, they could get hacked easily which puts the bridged assets at risk. Or if these validators collude, they could avoid submitting users requests and censor them. So in validator based bridges, the security and decentralization of bridges is equal to the security of decentralization of the validator layer. Most validator based bridges are operated by few validators, which put users' assets at a very high risk.

On the other hand, we have light client bridges. In this approach, there is a network of nodes who submit data from one chain to another. But the validity of submitted data is checked by the smart contract itself. Here the smart contract is the light client of the source chain. Which means that it can verify data of the source chain without trusting anyone with a minimal computation. So in light client bridge, nodes only submit source chain data on a smart contract on the target chain, and the smart contract verifies the validity of submitted data.

If the middle nodes submit invalid data, it would be rejected by the smart contract. This means that security of a light client bridge is equal to the security of the underlying source blockchain. Also in light client bridge, anyone can become a middle node and submit data. So this means the highest level of decentralization. If current middle nodes collude and don't submit your request, you can run a node and submit your request.

In summary, light client bridges are much more secure and decentralized than validator based bridges as they don't rely on middle nodes for validation. Also anyone can become a node easily. TeleportDAO bridge uses a light client approach to connect Bitcoin to other blockchains. So this bridge is as secure as Bitcoins.

Q: Which applications are powered by TeleportDAO's bridge?

Mahyar: 2 applications powered by TeleportDAO bridge: TeleSwap and TeleOrdinal. TeleSwap is a decentralized protocol for bridging BTC and Bitcoin tokens (BRC-20s and RUNEs) to other blockchains. So for example you can buy native ORDI using USDT from the BNB chain. Or you can buy native BTC using USDC on Ethereum.

You can also wrap your BTC and bring it to Polygon, where you receive TeleBTC, which is a decently wrapped BTC. You can use TeleBTC one DeFi apps and get yield on it. So basically you can get yield on your BTC.

Another application is TeleOrdinal. Ordinals are Bitcoin NFTs. In TeleOrdinal, you can purchase Ordinals using stablecoins from 5 different chains. So it's a cross-chain marketplace for Bitcoin NFTs. If you are an Ordinal holder, you can list them easily on TeleOrdinal. And users from EVM chains can bid for your Ordinal.

In summary, TeleSwap created AMM market for BTC/BRC-20/RUNE <> ERC-20, and TeleOrdinal created a cross-chain marketplace for Bitcoin NFTs.

Q: What is the utility of the TST token in TeleportDAO?

Mahyar: TST has different use cases. TeleportDAO nodes are required to lock some amount of TST to operate in the system.

In TeleportDAO bridge, relayer nodes are required to lock TST to be able to submit Bitcoin blocks on the smart contract. In TeleSwap, TST is used as collateral for Lockers. Locker nodes are decentralized Bitcoin custodians in the TeleSwap protocol. The Locker who locked more TST could process more transactions and earn more fee. As the volume of protocol grows, Lockers are required to lock more TST. So, the amount of locked TST will be increased over time.

In both TeleSwap and TeleOrdinal, the protocol fee would be waived for users who locked TST. So the regular users of these protocols can lock TST to pay less fee. TST is also used as a governance token to make decentralized decisions for TeleportDAO. For example, users can vote with chains to support, determine protocol fees, and etc.

Q: What are the future plans of TeleportDAO?

Mahyar: We are working with best Bitcon wallets to integrate TeleSwap into them. So their users can use TeleSwap protocol in-wallet for swapping Bitcoin assets to ERC-20s.

Also, we are expanding our Bitcoin bridge to major Bitcoin Layer 2(s). There will be big campaigns with the Bitcoin L2 foundation in the near future.

Another thing we are working on is to integrate TeleSwap with Bitcoin retaking protocols. Our Lockers hold a huge amount of BTC, which could be used in restaking protocols to generate more yield for Lockers. This would incentive users to become Locker.

Q: How does TeleSwap enable users to trade Bitcoin assets for ERC-20 tokens in a decentralized manner?

Mahyar: TeleSwap enables decentralized trading through light-client bridge and economic mechanisms.

Light-client bridge helps TeleSwap to validate Bitcoin transactions in a decentralized way. For example, it can check if a user sent BTC to protocol or not.

With economic mechanisms, we ensure that our nodes operate honestly. If they don't follow protocol rules, their collateral would get slashed.

Q: What would be the gas or transaction fees when bridging Bitcoin to Bitcoin L2s and EVM chains?

Mahyar: You need to pay for the Bitcoin transaction fee plus an extra fee called Locker fee which is 0.2% of the bridge amount. This fee incentives Lockers to provide their service to TeleSwap users.

Q: Partnership is always an important factor for every project. So who is your partner? What are the benefits you get from those relationships?

Mahyar: We partnered with the best Bitcon wallets including UniSat, Leather, Xdefi. Also we partnered with many Bitcoin ecosystem projects such as BitSmiley, Portal to integrate TeleportDAO bridge into their protocol to make them more decentralized. We have also partnered with Across to expand our protocols to more EVM blockchains.

Q: What are the benefits of using TeleSwap for trading Bitcoin assets compared to centralized exchanges?

Mahyar: TeleSwap is a DEX for Bitcoin. You can swap your Bitcoin assets for ERC-20s in a fully decentralized way. For example, you can buy BTC using stablecoins with just 1 click. Your request would be processed in less than 2 minutes with a very low fee.

Q: According to the roadmap, what are your most important next priorities? Does your team have enough funds and a strong community to achieve those milestones?

Mahyar: Our main priorities are expanding our bridge to new Bitcoin Layer 2(s) and integrating TeleSwap in major Bitcoin wallets. We raised more than $11m and have a strong Twitter/Discord community who support us to reach our goals.

🎁 Participate in the Teleport System Token AMA quiz now for a chance to win $10 in TST.

The form will remain open for five days from publishing this AMA recap.

KuCoin and Teleport System Token have prepared a total of $1,500 in TST to give away to AMA participants.

1. Pre-AMA activity: $600 in TST

2. Free-ask section: $50 in TST

3. Flash mini-game: $400 in TST

4. Post-AMA quiz: $450 in TST

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