Aave DAO is voting on a plan to let users borrow stablecoins against native Bitcoin that stays locked on Bitcoin itself.
A Snapshot vote running from November 6 to November 9, 2026 (U.S. Eastern Time) asks Aave DAO whether Aave V4 should treat native $BTC as collateral through Babylon’s Trustless Bitcoin Vaults. A depositor would lock bitcoin in a Taproot output on the Bitcoin network and borrow allowed stablecoins on Aave. An Ethereum token would record each position inside the lending system, while the underlying bitcoin would remain on Bitcoin rather than being wrapped, bridged, or held by a custodian.
Risk reviewer LlamaRisk recommended an initial cap of 300 BTC and a 78% collateral factor. Neither setting has been approved. Even if Snapshot passes, the market would still need a separate on-chain governance vote, with full risk parameters attached, before it could go live.
#Bitcoin #Aave #DeFi
DYOR. Not financial advice.
A Snapshot vote running from November 6 to November 9, 2026 (U.S. Eastern Time) asks Aave DAO whether Aave V4 should treat native $BTC as collateral through Babylon’s Trustless Bitcoin Vaults. A depositor would lock bitcoin in a Taproot output on the Bitcoin network and borrow allowed stablecoins on Aave. An Ethereum token would record each position inside the lending system, while the underlying bitcoin would remain on Bitcoin rather than being wrapped, bridged, or held by a custodian.
Risk reviewer LlamaRisk recommended an initial cap of 300 BTC and a 78% collateral factor. Neither setting has been approved. Even if Snapshot passes, the market would still need a separate on-chain governance vote, with full risk parameters attached, before it could go live.
#Bitcoin #Aave #DeFi
DYOR. Not financial advice.
