Satoshi Protocol Launches BTC-Backed Universal Stablecoin on Bitlayer Mainnet, Enhancing Bitcoin DeFi Ecosystem

June 18th, 2024 at 7:48 am UTC · 6 min read

/Satoshi Protocol/ – Satoshi Protocol, a pioneering force in Bitcoin-based stablecoin lending, has successfully launched its BTC-backed universal stablecoin, SAT, on the Bitlayer mainnet. This strategic deployment, in collaboration with Lorenzo’s Bitcoin liquidity layer, positions Satoshi Protocol as a transformative player in the expanding DeFi landscape, allowing users to mint SAT using BTC and stBTC as collateral.

Satoshi Protocol’s integration with Bitlayer marks a significant milestone in Bitcoin DeFi, enabling the use of stBTC (wrapped Bitcoin) as collateral to mint SAT stablecoins. This deployment leverages Lorenzo’s stBTC, further solidifying SAT’s role as a robust stablecoin within the Bitcoin ecosystem. The move not only enhances capital efficiency for Bitcoin holders but also paves the way for SAT’s utilization across various DeFi platforms, including Macaron, Bitlayer’s leading decentralized exchange (DEX).

Expanding Bitcoin DeFi with Bitlayer Integration and stBTC Support

Satoshi Protocol’s deployment on the Bitlayer mainnet wasn’t a surprise – it’s a crucial step towards build a robust universal stablecoin within the Bitcoin space. This move also embraces the burgeoning Babylon protocol, by allowing users to mint SAT stablecoins using Lorenzo’s stBTC as collateral. By expanding support to BTC-related assets like LSD and LRT in the future, Satoshi Protocol empowers Bitcoin holders to unlock greater capital efficiency from their holdings, and use SAT across various DeFi ecosystems thanks to this integration.

Satoshi Protocol Launches BTC-Backed Universal Stablecoin on Bitlayer Mainnet, Enhancing Bitcoin DeFi Ecosystem

Macaron, the leading DEX on Bitlayer, already features a SAT-BTC liquidity pool. This enables users to trade SAT and BTC directly while earning Macaron Points for future token airdrops. Integrating with more DeFi protocols and LSD solutions will unlock even more use cases and collaborative opportunities for SAT, solidifying the foundation for Bitcoin DeFi(BTCFi).

Satoshi Protocol: The Universal Stablecoin Backed by Bitcoin

Built on the Bitcoin ecosystem, Satoshi Protocol is a universal stablecoin that utilizes the CDP (Collateralized Debt Position) model to issue SAT, a USD-pegged stablecoin with over-collateralization. Aiming to be the go-to stablecoin protocol for Bitcoin (both mainnet and Layer 2), Satoshi Protocol offers a superior capital efficiency option compared to existing solutions. Users can leverage as low as 110% collateral ratio when minting SAT, maximizing the utility of their assets.

The combination of over-collateralization and redemption arbitrage ensures SAT’s peg to the US dollar. If the price of SAT dips below $1, users can exploit this arbitrage opportunity by redeeming the corresponding amount of BTC, effectively reducing SAT circulation. Conversely, users can borrow and sell SAT when the price falls below $1.1 to capitalize on price discrepancies.

Satoshi Protocol plans to launch its native token, OSHI, in Q3 2024. OSHI holders will benefit from 100% of the protocol’s revenue. Previously, Satoshi Protocol offered airdrop points for completing tasks, and collaborated with Binance Web3 and Bybit Web3 to distribute BEVM and OSHI tokens.

Satoshi Protocol Launches BTC-Backed Universal Stablecoin on Bitlayer Mainnet, Enhancing Bitcoin DeFi Ecosystem

SAT: 110% Over-collateralized Stablecoin

Satoshi Protocol safeguards the value of SAT through a system of over-collateralization. A collateral ratio (CR) of at least 110% is required to prevent liquidation. If a user’s collateralized BTC falls below this threshold, their position is automatically liquidated. The user’s BTC is then sold to cover the outstanding SAT debt. Liquidity providers in the Stability Pool benefit by purchasing this liquidated BTC at a discount, contributing to the liquidity of the system. This incentivizes users to participate and maintain a healthy liquidity pool.

Satoshi Protocol’s recent expansion to Bitlayer opens doors for even greater possibilities. It now supports both BTC and stBTC as collateral, with plans to integrate additional Bitcoin-related assets in the future. This move welcomes existing stBTC users within the Bitlayer ecosystem and allows them to leverage their holdings. Furthermore, by capitalizing on Satoshi Protocol’s industry-leading 90% loan-to-value ratio, users can unlock greater capital efficiency from their Bitcoin assets, which will enhance the usability of stBTC within the Bitlayer ecosystem.

How to Mint Stablecoin SAT with stBTC on Bitlayer

Satoshi Protocol enables users to mint SAT stablecoins using BTC and stBTC as collateral on Bitlayer. This guide provides a step-by-step walkthrough of the process, taking stBTC as an example, highlighting the interactions involved with Babylon, Lorenzo,Orbiter, Satoshi Protocol, and Macaron.

  • Withdraw BTC from exchange to your Taproot address
  • Stake BTC on Lorenzo
  • Receive stBTC on Lorenzo mainnet
  • Bridge stBTC to Bitlayer
  • Borrow SAT on Satoshi Protocol
  • Deposit wstBTC and borrow SAT

Visit this video for a step-by-step guide: How to Stake on Lorenzo and Deposit stBTC to Satoshi Protocol

Satoshi Protocol Launches BTC-Backed Universal Stablecoin on Bitlayer Mainnet, Enhancing Bitcoin DeFi Ecosystem

Unlocking New Use Cases for SAT on Bitlayer

Satoshi Protocol’s swift ascent to 7th place on the Bitlayer voting leaderboard underscores the community’s enthusiasm. As the protocol continues to forge partnerships within the Bitlayer ecosystem, SAT’s utility and integration will expand, unlocking new opportunities for users and driving innovation within the Bitcoin DeFi sector.

Satoshi Protocol Launches BTC-Backed Universal Stablecoin on Bitlayer Mainnet, Enhancing Bitcoin DeFi Ecosystem

Satoshi Protocol hit the ground running by deploying SAT-BTC and SAT-stBTC liquidity pools on Macaron, Bitlayer’s leading DEX. This move not only provided immediate utility for Bitlayer users, but also breathed new life into stBTC, a previously underutilized asset.

Macaron’s current liquidity pool trading competition offers even more ways to leverage SAT. Users who borrow SAT can participate by swapping or providing liquidity within Macaron’s pools, potentially earning higher returns and securing bonus points from Macaron itself.

Satoshi Protocol Launches BTC-Backed Universal Stablecoin on Bitlayer Mainnet, Enhancing Bitcoin DeFi Ecosystem

Visit the Macaron official website to learn more about the event.

About Satoshi Protocol

As a leading stablecoin lending project within the Bitcoin ecosystem, Satoshi Protocol brings a user-friendly, BTC-backed stablecoin application to Bitlayer. This positions them as a critical component of Bitlayer’s DeFi infrastructure. The integration empowers Bitlayer users to manage their assets more flexibly, optimize capital efficiency, participate in a wider array of DeFi activities, and ultimately drive innovation within Bitlayer’s burgeoning BTCFi sector.

As collaborations with more Bitlayer projects unfold, SAT’s utility will continue to expand. Satoshi Protocol’s exploration of the Babylon ecosystem, in addition to its existing partnerships with Macaron and Lorenzo, opens doors to exciting new possibilities and broader integration across the DeFi landscape.

Satoshi Protocol’s commitment goes beyond simply creating stablecoins and refining infrastructure. Their focus lies in building a robust ecosystem around universal, BTC-backed stablecoins. This dedication to innovation has the potential to spark significant advancements within both BTC Layer2 and the broader Bitcoin landscape.

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