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Author: Admin | 2025-04-28
Merchant.The merchant will carry out KYC and AML procedures in order to verify the identity of the user.The user and merchant will then perform an atomic swap, in which the user receives WBTC in exchange for their BTC. Users can also use an exchange that they trust to exchange their BTC for WBTC.Burning Wrapped Bitcoin (WBTC) TokensBurning refers to the process in which WBTC tokens are burned and redeemed for BTC. Only merchants are able to burn wrapped bitcoin tokens, and the steps for the burning process are as follows:The merchant will initiate a burn transaction on the Ethereum blockchain, burning X WBTC tokens.The custodian will then wait for 25 block confirmations for this burn transaction, to signal that the transaction is effectively irreversible.The custodian will then release X BTC to the merchants Bitcoin address.The custodian then makes an Ethereum transaction to mark that the burn request has been completed.Steps for Users to Exchange WBTC for BTCIn order for a user to exchange their WBTC for BTC, they can do so via a merchant on the network:User will firstly request the redemption of tokens from a merchant.The merchant will carry out KYC and AML checks to verify the identity of the user.The user and the merchant will then engage in an atomic swap, where the user will receive bitcoins in exchange for their WBTC tokens. The user can also choose to execute the transfer of WBTC for BTC on an exchange that they trust.Wrapped Bitcoin (WBTC) and SidechainsIn the initial phases, the Wrapped Bitcoin token will be launched on the Ethereum blockchain. However, the Wrapped Bitcoin team recognizes that the increased adoption of Ethereum could see the cost of executing transactions and creating dapps on Ethereum rise to a point where it becomes too expensive to carry out these activities.
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