The middle of BounceBit's innovation is its CeDeFi framework, a deliberate and strategic fusion of centralized finance (CeFi) and decentralized finance (DeFi).
This hybrid model is engineered to capture the maximum treasured attributes of each device: the custodial safety and institutional-grade strategies of CeFi, blended with the transparency, openness, and composability of DeFi protocols.
it is an "group meets DeFi" play designed to draw a large, conservative pool of capital that has traditionally been hesitant to interact with the crypto area.
at the CeFi aspect, BounceBit partners with regulated custodial services including Ceffu and Mainnet virtual to manage person belongings securely and compliantly. those custodians provide a degree of security and regulatory guarantee this is vital for institutional gamers.
The protocol then leverages institutional-grade strategies, consisting of delta-neutral funding rate arbitrage, deployed with the aid of expert quant groups to generate consistent yield.
A key differentiator is using tokenized actual-international property (RWAs) from partnerships with conventional finance giants like BlackRock and Franklin Templeton. as an example, the integration of Franklin Templeton's BENJI tokenized U.S. Treasury fund and a pilot strategy the usage of BlackRock's BUIDL token as collateral have supplied high-yield possibilities, with the latter reportedly accomplishing a 24% APY.
concurrently, the decentralized elements of BounceBit ensure on-chain transparency and freedom. The system lets in for the introduction of Liquid Custody Tokens (LCTs) like BBTC and BBUSD whilst customers deposit their BTC or stablecoins. these LCTs stay liquid while producing yield, permitting users to engage in DeFi activities like staking and farming.
The CeDeFi model presents a twin-tune strategy: it offers the peace of thoughts of custodial safety to institutions while providing the competitive, on-chain rewards that crypto-native customers are seeking for. that is a essential aggressive gain, as it de-risks the ecosystem for massive-scale gamers and taps into a protracted-dormant investor base.
The collaboration with Hashnote, which created a yield-bearing USYC token subsidized by U.S. authorities securities, similarly exemplifies this framework's ingenuity.
This "fee activation engine" lets in institutional capital to be used as an immediate credit score line on centralized exchanges without ever leaving its secure vault, a leap forward that merges the liquidity of CeFi with the yield-bearing nature of a regulated RWA.
