🐮 15 Minutes to Get Started: My First YBTC #YBTC
If you are hearing about YBTC for the first time, you can think of it as a "shadow asset of #BTC in the #Bitlayer world"—it is minted by BitVM Bridge, with 1 YBTC corresponding to 1 BTC locked on Bitcoin L1, and it can freely flow and participate in DeFi strategies within the Bitlayer L2 ecosystem. This allows you to maintain exposure to BTC price while using it for market making, lending, yield aggregation, and other operations, enhancing capital efficiency.
💥 So! How did YBTC come about?! @BitlayerLabs
The birth process of YBTC is simple, but there is a security mechanism behind it:
1. Locking L1 BTC: Transfer BTC into a cross-chain contract on the Bitcoin mainnet through the BitVM Bridge.
2. Verification and Batching: After the Bitlayer Rollup Operator receives your cross-chain request, it generates the corresponding L2 state change and attaches proof.
3. Minting YBTC: Once verified, your L2 wallet will receive an equivalent amount of YBTC for use in the Bitlayer ecosystem.
4. Redeeming BTC: In the reverse operation, after burning YBTC on L2 and passing the challenge period verification, you can retrieve BTC on L1.
5. Source of Security: The security of YBTC comes from the finality of Bitcoin L1, the BitVM-style challenge/verification mechanism, and the assurance of the Data Availability Layer (DA Layer).
Let me share a few strategies I thought of after my first experience with YBTC
📎 Deposit Interest: Deposit YBTC into lending protocols to earn fixed or floating interest.
📎 Market Making (LP): Place YBTC alongside another asset (like USDT) into a trading pool to earn transaction fees (note the impermanent loss).
📎 Lending Arbitrage: Use YBTC as collateral to borrow stablecoins and participate in other low-risk yield strategies.
Currently, my approach is to earn interest on deposits and not to engage in too many operations, after all, I prefer lower-risk methods!!
#MooKing
$BTC
