Decentralization Stages

V1 - Centralized Bridging Using the Celsius Backend

In this first phase, wrapping and unwrapping tokens will utilize a centralized backend while leveraging the Chainlink proof of reserve system to minimize trust. The goal of this stage is to quickly go-to-market and bring legitimacy to CelsiusX wrapped tokens (cxTokens), meaning transparency will be at the forefront of our efforts. An externally owned account (EOA) will manage vaults on Enzyme Finance. Once assets are locked a Chainlink oracle will broadcast the value of assets through a one-way proof of reserve, where CelsiusX can never mint more wrapped tokens than the locked amount in the vault. A primer on how to bridge assets using the Celsius app can be found here.
cxTokens are only accessible through the Celsius Webapp, only to verified users (who have gone through KYC/AML processes and are approved by Celsius) and only in select jurisdictions, based on Celsius' sole discretion.
This offering is currently not available in the USA, although we are working on a solution for this.

V2 - Proof of Collateral in All Directions

In the second phase, a CelsiusX vault manager contract will be deployed on the native chain and will take over management from the EOA. In this phase an isomorphic proof of reserve will enable minting/burning and withdrawing/depositing while ensuring the appropriate amount of collateral is always present. This two-way reserve provides additional accountability and transparency, further reducing the need for the user to trust CelsiusX, as reserves can only be withdrawn if a sufficient amount of corresponding wrapped tokens are burned. The isomorphic proof of reserve will also guard against drift from collateralization ratios between the target and native chains.

V3 - Decentralized Minting and Burning

Up to this point, all wrapping and unwrapping have been achieved through the centralized backend. In this phase, we would integrate a decentralized bridge to wrap assets cross-chain. Users would directly deposit into a trustless vault and wrap tokens cross-chain. This phase requires the use of cross-chain messaging systems such as Chainlink's CCIP, which is still currently in development, to pass messages between the native and target chains. At this stage, Celsius transitions from being the backend provider, to a user of the decentralized CelsiusX infrastructure.