Blockstream has expanded the membership of its federated Bitcoin sidechain to 59 members by adding 6 members.

The members include fintech-focused broker Watchdog Capital, Bitcoin-native financial service provider Vulpem Ventures, Liquid swap infrastructure provider SideSwap, Infrastructural privacy developer Nym Technologies, digital asset custody firm Komainu, as well as Bitcoin wallet app Coinos.

In July of last year, eight members were added to the sidechain. The new addition shows an increased interest in the industry’s leading sidechain.

With the growth of the federation comes the improvement of the Liquid network’s security. Also, there is more even distribution when it comes to decision making in the federation.

The 59 members in Liquid Federation include digital security services, gaming companies, infrastructure providers, trading desks, and cryptocurrency exchanges.

Liquid offers a different blockchain with digital assets pegged to Bitcoin. Sidechain has its own protocol rules and can provide more scalability and flexibility than what Bitcoin’s blockchain can provide.

Certain approved members are responsible for overseeing Liquid’s network as it operates under a “federated” model.

The Liquid sidechain first came on board in 2015 to speed up Bitcoin transaction settlement for cryptocurrency exchanges. The liquid token is known as the LBTC token, and there are currently 2,756 of them circulating, based on official data from Liquid.

Even with the expanded membership to 59 members, including BitMEX and OKEx, its TVL and volume are still relatively small compared to tokenized Bitcoin volume on Ethereum. Part of the reason for such a notable difference is the DeFi boom in the third-quarter of 2020, which drove tokenized BTC demands to enviable heights.

Data from btconethereum.com shows the number of tokenized BTC on the Ethereum blockchain has reached 148,000 BTC valued at about $5 billion on current market price.

As a result, Bitcoin’s value on Liquid is only 1.86% of the entire tokenized BTC on the Ethereum network. It’s a massive difference which the members at Liquid want to correct.

And as retail investors are the main users of the tokenized BTC supply on Ethereum, it won’t be easy to make direct comparisons with LBTC. This is due to the small number of applications and users of the Liquid tokens.

Blockstream has brided itself in Sidechain’s ability to ensure faster adoption and provide a faster peer-to-peer transaction. However, its relevance is still defeated, in recent months, by the Etherem-powered tokens.

The number of Ethereum-driven BTC tokens represent 40 times the number of tokenized BTC tokens on the Blockstream’s sidechain. It shows that most users still prefer the Ethereum network for their tokenized BTC compared to Sidechain's faster and scalable platform.

Also, 70 percent of Ethereum-driven tokenized BTC is kept in the Wrapped bitcoin protocol. Second online is HBTC with 12 percent, followed by renBTC with about 9 percent. So, tokenized BTC on Etherem still represents a majority of the volume.

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