Crypto Exchange Bybit has teamed up with Lending Protocol Avalon to provide Bitcoin yield to its users.
According to an Avalon Labs X announcement of April 14, the centralized protocol for decentralized finances (ECOPFI) will now be part of the exchange product of the exchange, by Bybit. Avalon said that it will allow users of the platform to win Bitcoin (BTC) yield by arbitrating on its fixed rate institutional loan layer.
Source: Labs Avalon
Avalon Labs announced in March that he had raised a minimum of $ 2 billion in credit with a possible scaling as the need results from it. The product allows institutional borrowers to access USDT (USDT) liquidity without liquidating their Bitcoin farms at a fixed loan cost of 8%.
In February, Avalon Labs also announced that she was planning to issue a public fund focused on Bitcoin debt. Venus Li, co-founder of Avalon Labs, said at the time that the fund could be issued by taking advantage of an US Securities Regulation:
“We have spent years looking for how regulations have been applied in traditional finance and if this could be a viable path for cryptographic companies. Although the previous precedents in the cryptographic industry are limited, our analysis of the previous cases approved by the SEC suggests a viable path. ”
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Centralized and decentralized finances unite
The product of Avalon Labs is a Cedefi protocol, somewhere between decentralized finance (DEFI) and centralized finance (CEFI). This product category – with increased control over capital flows and access – often has advantages to meet regulatory requirements for integration with CEFI platforms.
Integration bybit Earn operates the FBTC token with token 1: 1 of Bitcoin, developed by DEFI Protocol Mantle and the Cryptro-Cryptric Cryptric Antalpha Prime developer. These tokens are then sanded on Ethereum and other blockchains.
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A multi-protein system
The Avalon Labs platform accepts FBTC as a guarantee and lends it to fixed rates. Stablecoin USDT borrowed is then deployed on high -efficiency strategies via the Synthetic Dollar Labs Ethena Labs protocol. The assets used in these strategies include Ethena USD (USDE) and Ethena marked USD (Susde). The announcement claims:
“The yields are stable, secured and transmitted to Bybit Earn users – make bitcoin a productive active while maintaining simplicity and risk control.”
In other words, Avalon Labs serves as a bridge between Bybit and the yield potential of the Ethena Labs protocol. Avalon Labs describes this as a bridge “Cefi à Défi”.
The news follows Ethena rising $ 100 million at the end of February to deploy a new blockchain and launch a traditional finance token. In January, Ethena also announced her intention to deploy Iusde, a product identical to the USDE, but designed for regulated financial institutions.
Bybit did not respond to Cointelegraph requests by publication.
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