Verified Bitcoin (vBTC)

Overview

vBTC is Bitcoin on the VerifiedX network, one to one:

• Each vBTC is backed by Bitcoin held in a vault whose key is split among VerifiedX validators.
• vBTC moves between VFX addresses in seconds for a small VFX fee.
• Any holder can withdraw its vBTC to a Bitcoin address.

These steps describe the 9.0 releases of the VerifiedX wallet and web wallet. Use them with a Core 9.0 network: earlier wallet releases still offer steps a 9.0 vault no longer needs.

Getting Started

1. Create a vBTC token (vault). In the vBTC section, choose to create a token, give it a name, and confirm. The wallet starts a key ceremony among the validators (MPC Ceremony in Progress, rounds 1 to 3); it runs in the background and can be dismissed. When it completes, the contract is created and the token appears in your list. A new wallet can also use the wizard, which creates the token and funds it in one go.
2. Fund it. Open the token and choose Fund to send BTC from one of your BTC accounts, or copy the BTC Deposit Address and send from any wallet. The vBTC appears once the Bitcoin transaction is buried under 6 Bitcoin blocks (3 on testnet) and the validators have reported it. My Balance and Token Total Balance then show it.
3. Transfer vBTC. Transfer sends part of your vBTC to another VFX address. The owner can also transfer the token’s ownership; the new owner takes over the vBTC no holder holds.
4. Withdraw to Bitcoin. Withdraw, enter the BTC address, the amount and a fee rate, and confirm. The Bitcoin fee is taken out of the amount, so the address receives the amount less the fee. That’s all you send.

Following a withdrawal

After the request is in a block, the withdrawal dialog shows where it stands:

• Withdrawal in Progress, no Bitcoin transaction yet. The chain is waiting for the vault’s coins to pay it (for example while another withdrawal holds them). It is fixed as soon as they allow. Until then you can Cancel Withdrawal: when the cancel is in a block the withdrawal is closed and your vBTC is back. No vote is held.
• Withdrawal in Progress with a Bitcoin transaction. The chain has fixed the Bitcoin transaction that pays it, and the vault’s signers broadcast it on their own, usually within a few minutes. Open in BTC Explorer shows it. If it is not confirming, enter a higher fee rate and choose Raise Fee (the higher fee comes out of the withdrawal), or Release to give it up: its Bitcoin goes back to the vault and your vBTC is refunded, less the release’s Bitcoin fee. If the original transaction confirms first, the withdrawal is paid by it.
• Withdrawal Complete. Bitcoin has confirmed the payment. The dialog names the Bitcoin transaction that paid it.

You can close the dialog at any time and reopen the withdrawal from the token’s history. The VFX transaction list labels these steps vBTC Withdrawal Request, vBTC Withdrawal Fee Raise and vBTC Withdrawal Release, and shows the network’s Bitcoin Report transactions.

Older vaults

A vBTC token created before the network’s Bitcoin attestation height is an older vault. It is frozen at the network’s enforcement height: from then on its vBTC can’t be transferred or withdrawn, and Bitcoin sent to it is not credited. Before that height, move your vBTC to a new token or withdraw it. The token’s details say when a vault is an older one.

Reserve accounts

vBTC can be held in a reserve (vault) account for its time-lock and recovery protection. A transfer from a reserve account is held for 24 hours and can be called back until then. vBTC can’t be withdrawn to Bitcoin directly from a reserve account: move it to a normal VFX address first.

vBTC Flow Diagram

vBTC Flow DiagramvBTC-v2-TechAndFlow.pdf Download PDF