The purpose of launching CelsiusX wrapped assets is to enable users to exchange and interact with tokens on ecosystems of their choosing while having confidence in its value through the asset it represents and is backed by. Currently, most state-of-the-art collateralized assets are centralized and many are non-upgradable. In contrast, our end product, while starting centralized, will decentralize over time and be upgradable.
At a high level, CelsiusX will issue wrapped tokens on the target chain that are backed by assets on the native chain. For ERC20 tokens, a trustless vault (in our case, Enzyme Finance) is used to lock up the native asset. Enzyme Finance allows for on-chain Asset Management trustlessly, with only approved DeFi protocols being allowed to deploy deposited assets. Once assets are locked into the vault, a decentralized Chainlink oracle network broadcasts the value of the vault to a proof of reserve contract. The Chainlink proof of reserve provides the true collateralization of the wrapped tokens on the target chain and prevents them from being undercollateralized.

A quick primer on CelsiusX and the cross-chain liquidity bridge:


Currently, to access cross-chain DeFi, a user must have fragmented amounts of a single asset in multiple wallets and across multiple chains. The main issues with this model are fungibility (Asset A on Chain A is not immediately composable with Asset A on Chain B) and usability (sending assets from Chain A to Chain B requires bridges that introduce complexity and risk). CelsiusX is aiming to improve the user experience when interacting with protocols across different chains by standardizing wrapping in the DeFi ecosystem, which solves the fragmentation and fungibility issues present in current wrapping options. By acting as a cross-chain liquidity bridge, CelsiusX will create the next generation user experience where the user will have one hub wallet (on Celsius) from which the they can deposit and withdraw a standardized CelsiusX wrapped asset (cxToken) to any supported chain. In addition, state-of-the-art wrapped token providers, such as wrapped.com, don't allow for yield generation on the native asset and don't allow for retail users to wrap and unwrap tokens. Our novel approach for wrapping tokens is intended to enable yield generation on the native asset, while still maintaining full backing, and is easily accessible to everyday retail users.