🚀How it Works
Stake Bitcoin on L1 & Use it as Collateral
Last updated
Stake Bitcoin on L1 & Use it as Collateral
Last updated
CoreDAO enables non-custodial BTC staking, allowing users to keep their assets on their Bitcoin wallet while earning Core tokens:
Self-custodial Yield: Users maintain BTC custody, contribute to Core's network decentralization, and earn passive Core token rewards. Staking/Redeem transactions are executed directly within the Bitcoin L1, ensuring high security and ease of use.
Time-Locked: Users lock their BTC in a time-lock transaction to their own wallet, and specify a Core validator to delegate, earning Core tokens as rewards over the staking period.
Bitcoin staking on DeFi protocols and chains has doubled in size every month since Q2 2024, but:
L1 stakers get their BTC time-locked without self-custodial ways to make it liquid.
Liquid Staking/Restaking Tokens (LST / LRT) promise more yield and liquidity to the BTC ecosystem, but at a higher custody risk and overleveraging.
VaultLayer unlocks capital efficiency for staked Bitcoin. Users grow their BTC + rewards easier, without losing custody..
Liquid Staking Vaults (LSV) are a new type of asset that allow Self-Custodial Liquid BTC Staking, Here's how it works:
1) Users mint a new LSV, which can be an Ordinal on L1 or an CAT721/ERC721 token on L2.
2) Users then use the LSV to stake BTC in CoreDAO (L1). The staked bitcoin never leaves L1, it's only "time-locked" until the maturity period chosen by the user (i.e. 3 months)
3) If the user needs liquidity sooner (i.e. only 1 month after), they can go to an ordinal or ERC721 market and borrow using the LSV as collateral.
Suppliers lend liquidity and borrowers pay them interest or default. Whoever is the LSV ordinal/NFT owner when the stake maturity time has passed, can redeem the locked Bitcoin and claim the rewards.
Note: Try the app on https://app.vaultlayer.xyz/ with testnet BTC & earn LASER points!
