Currently, the Bitcoin ecosystem has become one of the most concerning topics in the crypto community. In addition to following the trend of FOMOs inscription craze and the various token protocols that are continuing to be built, investors who are still waiting and watching are more concerned about the DeFi scene in the Bitcoin ecosystem.
With the surge in various BRC tokens in the past month, related assets within the Bitcoin ecosystem have accumulated to a considerable scale. According to Coingecko data, the market value of the BRC-20 market currently exceeds US$600 million. Along with this comes the need for liquidity from investors in BRC-20 assets.
Recently, several DeFi protocols in the Bitcoin ecosystem have seen new trends. BlockBeats summarizes them as follows:
Cross-chain bridge
A relatively efficient way to explore DeFi applications in the Bitcoin network without smart contracts is to bring BTC assets into public chains with smart contract functions such as Ethereum, and directly utilize their complete DeFi infrastructure. Bridges are critical infrastructure for Web3, and Bitcoin is no exception. Without a decentralized/composable bridge, dApps built on Bitcoin cannot integrate cross-chain liquidity, limiting their growth potential. This usage scenario has given rise to some projects focusing on cross-chain Bitcoin assets.
MultiBit
Multibit is a bridge protocol that emerged in May this year to connect BRC 20 assets to the EVM network, allowing users to seamlessly transfer tokens between the ETH chain, BNB chain and BTC network. Multibit completed the IDO auction on the auction platform Bounce Finance on November 12, raising 88 ETH. On November 4, the IDO was completed again on the Bitcoin network donation platform TurtSat at the same unit price, raising 4.64 BTC. The total raised between the two rounds was approximately $350,000.
MultiBit simplifies the process of transferring tokens between Bitcoins BRC 20 and EVM networks. First, users transfer BRC 20 tokens to a dedicated BRC 20 address. After confirmation, the Multibit protocol starts working, minting an equal amount of tokens on the Ethereum or BNB chain. Multibit Protocol collects tokens from all distributed unique addresses. The tokens are securely transferred to a unified cold wallet. When a user needs to withdraw tokens, Multibit Protocol will destroy the corresponding number of tokens from the EVM chain. The equivalent value of tokens is then transferred to the user from a secure cold wallet.
Two weeks ago, MultiBit received great attention from the community due to the huge increase in its token MUBI. MUBI completed the auction on the Ethereum chain on the auction platform Bounce Finance on the 12th. The unit price of IDO was US$0.00047, raising 88 ETH. On the 14th, an IDO was completed on the Bitcoin network donation platform TurtSat at the same unit price, raising 4.64 BTC. The total raised between the two rounds was approximately $350,000. On November 14, MUBI opened with an increase of 1140%. On the 16th, MUBI experienced a 24-hour increase of 122%, hitting $0.01385.
On November 26, MultiBit went onlinePledge system. Users can pledge $MUBI tokens and receive rewards in the form of ERC 20 or BRC 20 tokens on the Mutibit platform. Currently, the tokens that users can pledge are NHUB and BSSB. As of the time of writing, there are more than 200 million of them. MUBI is staked on Mutibit.
XLink
On November 24, the Bitcoin DeFi platform ALEX announced that its cross-chain component ALEX Bridge will transform the XLink unique entity.
In its announcement, XLink is positioned to “become the infrastructure that connects Bitcoin and its derivatives (such as BRC 20), integrating the Bitcoin Oracle powered by ALEX to achieve seamless integration between Bitcoin and Bitcoin L1 assets. Seamless and secure bridge. XLINK can provide native-like BRC 20 AMM or other DeFi applications for Bitcoin.
Before the separation of XLink, ALEX was an open source DeFi protocol based on the Stacks public chain. The current mainnet version features include Swap, lending, staking, revenue mining, and Launchpad.
LSD
Fairlight CDP
FairLight CDP is a collateralized debt position protocol that allows users to deposit BRC-20 tokens, borrow BRC-20 synthetic asset sats, and then deposit sats to earn a portion of the lending interest as a reward, and can use FCDP tokens to participate in the protocol Governance and sharing agreement fees. On November 28, Fairlight appeared on UniSat’s official website as a partner.
The developers have deployed a BRC-20 token called FCDP with a total supply of 16,180 (to commemorate the birth of the natural logarithmic base Euler number e in 1618), with a limit of 1 per inscription. The developers minted 207 at the deployment address, accounting for 1.27% of the total supply, and all inscriptions have now been minted.
Fairlight’s economic model aims to create a sustainable and growth-oriented DeFi ecosystem. The model revolves around the strategic use of SATS tokens and integration with the UniSat Swap module to create a stable and prosperous environment for all participants.
In DeFi, various financial operations such as lending, leveraged short selling, and arbitrage can be realized through CDP. Therefore, FairLight CDP is expected to bring more trading volume and liquidity to BTC-20. Its token FCDP is also popular among the community. According to UniSat data, its price has more than tripled since its launch less than a month ago. As of the time of writing, its floor price is 0.01 BTC, and the total transaction volume has exceeded 22 BTC.
CEX
Orders Exchange
Orders Exchange is the first decentralized exchange (DEX) with an order book that fully runs on the Bitcoin network. It combines the Ordinals protocol, PSBT technology, Bitcoin script and the revolutionary Nostr protocol to create an interconnected Full-chain trading market. Last week, Orders Exchange launched a liquidity mining campaign.
PSBT (Partially Signed Bitcoin Transaction) is a standard format designed to simplify the processing of Bitcoin transactions that have not yet been finalized. Originally introduced in Bitcoin Improvement Proposal (BIP) 174, PSBTs core value lies in its ability to provide an efficient and secure collaborative process for transaction construction, especially where multiple signatures are required. By using PSBT, entities involved in a transaction can sign independently and incrementally without disclosing sensitive data to each other.
By leveraging PSBT and multi-signature technology, Orders Exchange can implement a completely trustless BRC 20 liquidity pool. The liquidity provided by the user is actually a PSBT single-sign asset pair, and its output points to a multi-sign address shared by the user and the exchange. This design ensures that exchanges cannot directly cash out PSBT and take away users’ assets, thus protecting the assets of liquidity providers.
On November 24, Orders Exchange launched a 10-day liquidity mining for the first time on the Bitcoin network event, aiming to reward users who provide liquidity and execute transactions, and process it through repurchase and destruction Service fees for BID orders. Users can be rewarded with $RDEX tokens for participating in the event. Currently, Orders Exchanges liquidity pool holds more than 2.6 million RDEX, with a value of approximately 11 BTC.
Stablecoin
BitStable
BitStable is a decentralized asset protocol based on the Bitcoin network that allows anyone, anywhere to generate $DAII stablecoins against collateralized assets in the Bitcoin ecosystem. On November 29, BitStable completed an IDO on the Bounce Finance platform, but due to a DDOS attack, uneven distribution of tokens occurred.
Related Reading:$BSSB was attacked immediately after it went online, and BitStable was questioned by the community as Rug》
BitStable has a dual-token system and a cross-chain compatible structure, and its tokens are $DAII and $BSSB. According to the official website information, DAII is a stable currency whose value and stability come from the robustness of the Bitcoin ecosystem assets, including BRC 20, RSK, and Lightning Network. In addition, in BitStables vision, DAII can also bring the Ethereum community into the Bitcoin ecosystem with its cross-chain capabilities. The total supply of $DAII is 1 billion.
BSSB is the platforms governance token, which is used by the community to maintain the system and manage DAII. BitStable will also incentivize $BSSB holders through dividends and other measures.
Conclusion
In addition to the DeFi protocols listed above, there are also some relatively early-developing DeFi protocols in the Bitcoin ecosystem, such as the open source Bitcoin DeFi platform ALEX based on the Stacks ecosystem, whose tokens once rose by more than 40% in the past two weeks. In addition, the lending protocol MoneyOnChain and the DeFi platform Sovryn on the Bitcoin side chain RSK have also accumulated a certain amount of liquidity.
BlockBeats reminds that the development of DeFi applications in the Bitcoin ecosystem is still in its early stages, with relatively high risks of uncertainty. Investors are advised to fully understand the protocols involved, assess their own risk tolerance, and make cautious decisions before making any investment decisions.
