Introduction
@BounceBit (BB) is a cutting-edge layer-1 blockchain that aims to make Bitcoin more productive. It introduces a unique framework combining centralized finance (CeFi) with decentralized finance (DeFi). While many projects focus on simply wrapping Bitcoin for use in DeFi, BounceBit takes it a step further by allowing Bitcoin holders to earn yield through a CeDeFi model. This approach not only keeps Bitcoin secure, but also enables users to participate in yield strategies usually reserved for big institutions.
Developed by YZi Labs, BounceBit integrates a dual-token proof-of-stake (PoS) system alongside regulated custody, which gives everyday crypto users access to institutional-grade yield. The platform leverages liquidity custody tokens (LCTs) to let users earn interest from off-chain strategies, which can then be restaked on-chain to secure the network and farm in DeFi protocols.
The Core of CeDeFi
The real innovation behind BounceBit is its CeDeFi yield framework. By partnering with Ceffu (formerly Binance Custody) and Mainnet Digital, BounceBit offers secure custody for assets like Bitcoin, Ethereum, and other cryptocurrencies. Through MirrorX, a solution by Ceffu, assets are held off-exchange but can quickly be traded on Binance’s order books, keeping the system fast and secure.
The yield system is powered by delta-neutral strategies—a fancy term for using price differences in spot and futures markets to generate stable returns. For example, when funding rates are high, the strategy buys Bitcoin and shorts perpetual futures, ensuring profits even in volatile markets. The end result is stable returns, even in the ever-fluctuating world of crypto.
Assets like Bitcoin, Ethereum, and tokenized real-world assets (RWAs) such as USDY are eligible for this yield system. And because the entire process is under regulated custody, you can rest assured your funds are both secure and transparent. You can track your balance and see how your assets are performing in real time.
Liquidity Custody Tokens (LCTs)
One of the standout features of BounceBit is its liquidity custody tokens (LCTs). When users deposit Bitcoin or other assets into regulated custody, they receive an LCT on a 1:1 basis. For example, if you deposit BTC, you’ll receive BBTC as an LCT. These tokens are fully redeemable and can be used as collateral for staking, DeFi farming, or yield generation.
LCTs make it possible to earn yield both in CeFi and DeFi simultaneously. This flexibility allows users to benefit from both worlds, without needing to compromise on liquidity or security.
Dual-Token PoS Chain and Restaking
How the Consensus Works
At the heart of BounceBit’s consensus model are two tokens: $BB , the utility token of the network, and BBTC, the tokenized version of Bitcoin held in custody. Validators can stake BB or BBTC to participate in block production and secure the network. There’s no minimum stake required, and the network rotates validators every 24 hours based on voting weight.
Validators receive transaction fees and can set a commission. This dual-token design helps reduce volatility, encourages more Bitcoin holders to participate, and makes the network more secure. Users who don’t want to run a validator themselves can delegate their tokens to trusted validators and share in the rewards.
Liquid Staking and Restaking
BounceBit offers liquid staking derivatives (LSDs), which are tokens representing staked assets. For example, when you stake BB, you receive stBB, and when you stake BBTC, you receive stBBTC. These tokens can be traded or used in DeFi while still earning staking rewards. If you choose to unstake your tokens, the process takes just a few days, but keep in mind that there are risks, such as slashing and key compromise.
What’s even more interesting is that these staked tokens can be restaked to other protocols, creating a unique opportunity to earn rewards on multiple networks simultaneously. In the CeDeFi yield module, stBBTC or BBUSD are used for yield generation, allowing users to earn both CeFi yield and staking rewards at the same time.
The BTC Bridge
To bring native Bitcoin onto the BounceBit chain, the platform uses a BTC bridge. Instead of relying on a single multisignature, the bridge uses a validator-centric model, where each PoS validator runs a bridge node. This decentralized approach adds an extra layer of security, ensuring that transactions are safe and transparent. Once BTC is bridged, it becomes BBTC and is ready to be used for staking and DeFi.
Yield Structure and Product Suite
BounceBit offers a wide range of yield products for users to explore:
Funding-rate arbitrage (delta-neutral): This strategy takes advantage of differences in funding rates on perpetual futures to generate stable returns, offering a safer alternative to traditional yield farming.
Fixed and auto-compounding strategies: These aim to provide consistent returns by using hedging and interest-rate products.
Real-world asset (RWA) vaults: These allow users to deposit stablecoins or stBBTC into regulated funds and earn yields from underlying assets plus BB staking rewards.
DeFi farming and derivatives: BounceBit also supports swaps, meme-token issuance, derivatives trading, and lending, making it a comprehensive platform for earning yield in the DeFi space.
Tokenomics and Early Funding
The total supply of BB tokens is capped at 2.1 billion. A significant portion—35%—is allocated to staking rewards, incentivizing users to stake their tokens and secure the network. In 2024, BounceBit raised $6 million in funding, and BB serves as the staking, governance, and gas token for the network.
The CeDeFi Advantage
The CeDeFi model combines the best of both CeFi and DeFi, offering several advantages:
Stable yields: By using regulated custody and delta-neutral strategies, BounceBit provides more stable returns compared to typical DeFi yield farming, which is often more exposed to price swings.
Dual revenue streams: Users can earn yield from both CeFi strategies and staking rewards, maximizing their potential earnings.
Easy participation: LCTs simplify the process of earning yield, allowing users to participate in DeFi without worrying about the technical complexities of custody and bridging.
Security and compliance: BounceBit emphasizes regulatory compliance, ensuring that users’ assets are protected by multi-layer custody solutions and on-chain proof of reserves.
Recent Developments (2025)
Franklin Templeton Integration
In 2025, BounceBit introduced BB Prime, a platform designed for institutional yield strategies. A key feature is the integration of Franklin Templeton’s BENJI tokenized money-market fund, linking U.S. Treasury yields to DeFi strategies. This partnership aims to attract stable capital while offering consistent returns with the security of traditional finance.
BB Token Buyback Program
BounceBit has also initiated a buyback program, repurchasing over 8.87 million BB tokens to reduce circulating supply and stabilize token value. This program will continue as long as the revenue from BB Prime supports it.
xRWA and Tokenized Stocks
BounceBit is pushing the boundaries of traditional finance by introducing xRWA, a protocol that allows tokenized real-world assets like equities and bonds to be staked on the blockchain. This innovation bridges the gap between traditional assets and decentralized networks, offering users new opportunities to earn rewards while holding tokenized equities.
Conclusion
BounceBit is changing the game by making Bitcoin more productive and accessible, while bridging traditional finance with decentralized finance. With its CeDeFi architecture, innovative staking mechanisms, and partnerships with major players like Franklin Templeton, BounceBit is poised to offer a new wave of yield products for both retail and institutional users. As the platform continues to grow and integrate real-world assets into DeFi, it stands at the forefront of the next evolution in blockchain-based finance.