borrowing against native Bitcoin is the first use case. its not the last.
the way Trustless Bitcoin Vaults (TBV) is designed, the collateral layer is separable from the application layer. any application that can read the cryptographic proof 0f a 😅
TBV vault can use native Bitcoin as collateral for whatever financial product its building. Babylon doesnt need to build every application....the infrastructure is the primitive. what gets built on top of it is limited only by what developers and protocols decide to create.
the talking points list some of the directions this is already heading..
lending, stablecoins, credit cards, derivatives, insurance. i want to sit with a few of those because the implications are gnuinely interesting and not immediately obvious.
a Bitcoin-backed stablecoin would be the first stablecoin collateralized by native BTC rather than a wrapped proxy. the trust properties of the underlying would flow through to the stablecoin in a way that has never been possible before.
a Bitcoin-backed credit card means spending power derived from a native BTC position without liquidating it. derivatives 0n native Bitcoin collateral means hedging and leverage structures
that today require handing your Bitcoin to a centralized exchange.
what connects all of these is the same thing TBV does for borrowing removing the intermediary between Bitcoin and the financial product. every one
of these use cases has existed in some form using custodied or wrapped Bitcoin. TBV is the vrsion of the same products without the custodian in the middle.
i find the insurance use case the most underexplored. Bitcoin-collateralized insurance pools
would have fundamentally different risk characteristics than anything curently available in DeFi. thats a design space that barely anyone is talking about yet??
#baby @BabylonLabs_io $BABY
the way Trustless Bitcoin Vaults (TBV) is designed, the collateral layer is separable from the application layer. any application that can read the cryptographic proof 0f a 😅
TBV vault can use native Bitcoin as collateral for whatever financial product its building. Babylon doesnt need to build every application....the infrastructure is the primitive. what gets built on top of it is limited only by what developers and protocols decide to create.
the talking points list some of the directions this is already heading..
lending, stablecoins, credit cards, derivatives, insurance. i want to sit with a few of those because the implications are gnuinely interesting and not immediately obvious.
a Bitcoin-backed stablecoin would be the first stablecoin collateralized by native BTC rather than a wrapped proxy. the trust properties of the underlying would flow through to the stablecoin in a way that has never been possible before.
a Bitcoin-backed credit card means spending power derived from a native BTC position without liquidating it. derivatives 0n native Bitcoin collateral means hedging and leverage structures
that today require handing your Bitcoin to a centralized exchange.
what connects all of these is the same thing TBV does for borrowing removing the intermediary between Bitcoin and the financial product. every one
of these use cases has existed in some form using custodied or wrapped Bitcoin. TBV is the vrsion of the same products without the custodian in the middle.
i find the insurance use case the most underexplored. Bitcoin-collateralized insurance pools
would have fundamentally different risk characteristics than anything curently available in DeFi. thats a design space that barely anyone is talking about yet??
#baby @BabylonLabs_io $BABY
