The Internet Computer to integrate Bitcoin and Ethereum this year

• According to a new report, Dfinity plans for the technical integration of the Bitcoin network with the Internet Computer protocol. 
• Dfinity has come up with several developments including enabling Smart Contracts to hold their balance of ICP tokens.

The Internet Computer, a public blockchain and protocol that permits developers to install Decentralized Applications and Smart Contracts on the blockchain has in its 2022 roadmap disclosed plans to integrate Ethereum and Bitcoin. The senior technical program manager Dieter Sommer explained that the Bitcoin integration will involve two major features. 

According to the report, the first is the actual technical integration of the Bitcoin network with the Internet Computer protocol. 

It deals with connecting from IC nodes to nodes of the Bitcoin network, obtaining Bitcoin blocks, providing blocks through IC consensus, processing them, serving UTXO [unspent transaction output]sets to canister smart contracts, and allowing canisters to submit BTC transactions to the Bitcoin network.

The other deals with translating Bitcoin’s use of Elliptic Curve Digital Signature Algorithm (ECDSA) signature to the Internet Computer’s trust model. With the concerns that the use of a bridge will make the network vulnerable to malicious attack, Smart Contracts will be added to the Bitcoin blockchain using Chain Key Cryptography. Bitcoin’s integration is part of the expected launch of Dfinity’s “Chromium Satoshi Release” planned for the first quarter of the year. 

According to Berto Parga Pena, a Dfinity community member, Chain Key Cryptography is the breakthrough for the Internet Computer to scale to millions of nodes. 

It is a set of cryptographic protocols that orchestrate the nodes that make up the Internet Computer and the engine that drives it and makes its operation possible.

The Internet Computer integration with Ethereum

Director of Product at Dfinity, Diego Prats also wrote:  

Smart contracts on the Internet Computer will be able to hold, send and receive Bitcoin, without the need for private keys.

The Ethereum integration is also part of the “Vanadium Vitalik Release” scheduled for launch in the third quarter of the year. 

According to Michael Less, Vice president of Communication, the integrations are meant to facilitate Dfinity’s “Multi-Chain Future” vision. He explained that the best user experience is to combine all the networks directly. 

So when you make a transaction on the internet computer in Bitcoin, it changes the Bitcoin ledger versus what you see today, with a bridge. It’s like a wrapped Bitcoin or wrapped Ether.

Dfinity has come up with several developments including enabling Smart Contracts to hold their balance of ICP tokens. As it stands, 250,000 queries are supported by ICP, and it currently executes transactions within 1-2 seconds. 

The Internet Computer blockchain has also hosted its first Decentralized Exchange (Sonic). The ICP token appeared as the worst-performing crypto asset in 2021, losing 97 percent of its all-time high recorded in May. This is expected to change as Binance has announced that it is introducing a financial instrument that will enable traders to swap ICP to and from ETH.