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In a latest episode of the SlateCast, Badger.com founder Spadaboom joined Senior Editor Liam “Akiba” Wright and CryptoSlate CEO Nate Whitehill to debate the way forward for Bitcoin DeFi and the function of the ETH-BTC ratio in bridging the 2 worlds.
eBTC goals to create a decentralized and immutable illustration of Bitcoin on Ethereum, permitting customers to take part in DeFi purposes whereas sustaining the core properties of Bitcoin.
The Origins of eBTC
Spadaboom has been a proponent of Bitcoin for over a decade, however he additionally grew to become engaged within the Ethereum world since its early days. This led him to consider in duality versus tribalism, recognizing the worth in each ecosystems. In 2019, he put his efforts into bringing utility to Bitcoin, permitting holders to earn yield and take part in monetary actions past simply holding. Spadaboom mentioned:
“After I determined to place some pedal behind the steel, in 2019, it was actually about how do you carry utility to Bitcoin? And on the time I felt like folks with Bitcoin, like myself, and I’m certain you guys wish to do shit with it. It’s so simple as that. They wish to earn some yield.”
Ethereum’s Position in Bitcoin DeFi
Whereas Spadaboom acknowledges the thrilling developments taking place on the Bitcoin community, he believes that Ethereum’s infrastructure and scaling capabilities make it an excellent platform for constructing a strong Bitcoin DeFi ecosystem.
He sees the ten billion WBTC (Wrapped Bitcoin) sitting on Ethereum as proof of the demand for a illustration of Bitcoin that can be utilized in DeFi. Spadaboom defined:
“I nonetheless suppose there’s a fairly huge alternative for those that wish to use a illustration of Bitcoin on different networks akin to the Euro greenback, proper? If you consider it in these sorts of phrases, and if you consider it like that, naturally That’s driving demand for bitcoin, proper?”
eBTC and the ETH-BTC Ratio
eBTC is designed to be one of the simplest ways to borrow Bitcoin, providing low over-collateralization and no charges. Utilizing Ethereum as collateral, customers can borrow Bitcoin and leverage the ETH-BTC ratio as much as 11 occasions. This capital-efficient method, mixed with the staking rewards from Ethereum, permits customers to earn yield whereas holding a illustration of Bitcoin.
“And for us, it’s as a result of, EBTC spits out as like a Bitcoin peg steady coin towards, it’s simply the identical idea, proper?” Spadaboom mentioned, referring to the leverage loop that permits customers to extend their publicity to the ETH-BTC ratio.
The Way forward for Bitcoin DeFi
Whereas acknowledging the dangers and potential for losses within the rising Bitcoin DeFi ecosystem, Spadaboom stays optimistic concerning the future.
He believes that by utilizing foundational items of the Bitcoin stack, like information availability, and leveraging the prevailing infrastructure on Ethereum, a safer and extra scalable Bitcoin DeFi ecosystem might be constructed. Spadaboom mentioned:
“I do suppose that, my definition of constructing on Bitcoin or a layer two is one thing that makes use of foundational items of the the Bitcoin stack to make sure that, it might probably function and has operational capability, however that almost definitely is not going to that almost definitely is not going to imply that it needs to be constructed on Bitcoin within the purest sense.”
Because the urge for food for growth on Bitcoin continues to develop, Spadaboom sees alternatives for eBTC to increase and combine with different protocols and layer 2 options. Nonetheless, the main target at present lies strictly on the Ethereum mainnet. With the drive to create utility for Bitcoin and the potential for the ETH-BTC ratio to bridge the 2 ecosystems, the way forward for Bitcoin DeFi seems promising.
Watch the complete podcast right here:
NEW PODCAST 🎙️ Does the ETH-BTC ratio provide a decentralized bridge for #Bitcoin DeFi and EVM interoperability?
That includes @spadaboom1 of @BadgerDAO/@ebtcprotocol with co-hosts @akibablade and @NateWhitehill pic.twitter.com/uqivYULxzX
— CryptoSlate (@CryptoSlate) February 22, 2024
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