@BabylonLabs_io There's a distinction in Trustless Bitcoin Vaults (TBV) that I almost skimmed past the difference between the protocol layer and the applications built on top of it.
TBV itself is the core collateral protocol. It owns vault creation vault redemption the proof verification flow, and the vault's state. That's the whole job of the protocol layer nothing more.
Everything else lending, and eventually stablecoins
options insurance sits on top as a separate layer Each application defines its own product logic its own borrowing rules its own liquidation rules its own reward structure. The first application live today is native Bitcoin backed borrowing.
What I find useful about this separation is that a vault is created for one specific application at creation time and can't be moved between applications later.
The protocol doesn't get more complicated as more applications integrate with it. Each one plugs in through its own adapter and the core vault logic stays exactly the same underneath.
It's capital efficient and it uses native BTC directly as collateral no wrapping, no bridging. Both of those come from keeping the protocol layer this narrow and letting applications handle everything else.
The public testnet is live if you want to see this two layer structure in practice rather than just read about it.
#baby $BABY
TBV itself is the core collateral protocol. It owns vault creation vault redemption the proof verification flow, and the vault's state. That's the whole job of the protocol layer nothing more.
Everything else lending, and eventually stablecoins
options insurance sits on top as a separate layer Each application defines its own product logic its own borrowing rules its own liquidation rules its own reward structure. The first application live today is native Bitcoin backed borrowing.
What I find useful about this separation is that a vault is created for one specific application at creation time and can't be moved between applications later.
The protocol doesn't get more complicated as more applications integrate with it. Each one plugs in through its own adapter and the core vault logic stays exactly the same underneath.
It's capital efficient and it uses native BTC directly as collateral no wrapping, no bridging. Both of those come from keeping the protocol layer this narrow and letting applications handle everything else.
The public testnet is live if you want to see this two layer structure in practice rather than just read about it.
#baby $BABY