# Getting Started

## **What is acBTC?**

acBTC is a composite asset backed by a basket of ERC20 BTC, designed for usability and interoperability across blockchain networks. Every constituent in the composite basket is 1:1 backed by BTC. \
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The acBTC ecosystem integrates BTC and ERC20 BTC, with swap, stablecoin and yield generating applications into one highly secure, efficient and usable standard. \
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Key pain points faced by native BTC and ERC20 BTC holders today:

**Usability**\
Over collateralization requirement in existing lending protocols is sidelining a large volume of BTC liquidity from entering the DeFi space.

**Single Point of Failure**\
Reliance on centralized custodian and/or secluded network verification nodes could potentially lead to system failure.

**User Friction**\
Tradeoff between cost and timeliness associated with the mint and redemption process of ERC20 BTC.

With the introduction of acBTC, various forms of liquidity pegged against BTC can move efficiently between blockchain networks. Unleashing the potential of blockchain networks by expanding the capabilities of existing dApps and supporting innovative use cases.

acBTC represents some underlying value peg; can be minted and redeemed on-chain via smart contracts. acBTC is backed 1:1 with a basket of ERC20 BTC assets (also referred to as composite BTC basket).

Each acBTC represents a liquidity share of the composite BTC basket as well as an anchor asset for medium of exchange, unit of account and store of value.

Users can swap ERC20 BTC within the composite BTC basket with minimum slippage. For example, users can swap 1 WBTC for 1 renBTC at a dynamic fee schedule determined by the weights and consensus price difference between the two assets.

AC is an ERC20 asset that empowers community governance of the acBTC ecosystem. AC token holders can participate in the governance system of the various acBTC applications (acSwap, acLoan). The objective is to achieve long-term sustainable value, community Governors will be incentivized to collectively steer the acBTC ecosystem into the future with sound decision making.

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