BTCB launched on the BNB Chain in April 2019 backed by the Binance exchange. Binance published the reserve address to demonstrate the transparency of the project so that anyone can publically verify the amount of BTCB tokens issued match the number of BTC deposited.
BTCB is created and maintained by a centralized exchange, Binance. In addition, Binance created a trading pair on its centralized exchange for BTCB-BTC to provide an easy way for anyone to convert from the pegged token back into native BTC on Binance exchange. When a buy order is filled, a new order will be placed while an equal amount of funds will be deposited from the reserve address into Binance exchange. The sum of the buy order and funds on the published reserve address is always bigger than the total supply of BTCB to ensure it is always fully backed.
BTCB will never have the same level of decentralization or security as BTC since it relies on trusting people and organizations to manage the system instead of automated smart contracts. Nonetheless, BTCB publishes the reserve address for anyone to audit. Users can always independently verify if the amount of BTC reserved in the BTC address on the Bitcoin blockchain matches the amount of BTCB tokens minted on the BNB chain.
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