Deposit BTC, borrow ERC-20, and vice versa
BiFi, a revolutionary DeFi solution, has started a new era in decentralized lending by bringing Bitcoin into the game. Announcing DeFi 2.0, the lending platform allows users to use BTC and ERC-20 tokens when borrowing and lending interchangeably.
According to its recent Medium article, BiFi allows users to employ their BTC holdings into a fully developed DeFi product. This is the first platform to allow such flexibility and interoperability between the two most popular blockchains: Bitcoin and Ethereum.
BiFi brings Bitcoin to DeFi
In the world of cryptocurrencies, BTC is, and will remain, the foundation of the whole ecosystem. However, until recently, the only way to use your BTC in Ethereum-based DeFi platforms was through tokenized BTC alternatives like wBTC and renBTC. Unfortunately, wrapped BTC represents only about 1% of the total BTC volume held among all user wallets. This means that BTC DeFi is largely unavailable. This is where BiFi brings in its revolutionary lending platform.
In order to benefit from BiFi’s BTC lending and borrowing mechanisms, users will need to connect their MetaMask wallet to BiFi. Once you’ve connected your wallet, you will be able to unleash the potential of your BTC holding. Lend against them to earn interest, or borrow against them to source more capital for your investing endeavors. With BiFi, users can finally start benefiting from decentralized finance with BTC. Additionally, users can benefit from the full range of tokens available on the Ethereum blockchain without having to wrap or tokenize their BTC.
Security is a top priority
As the crypto industry is still in its infancy, many DeFi projects fall victim to hacker attacks because they undermined the importance of strict security practices put in place. BiFi understands how important security is to DeFi.
The platform maintains computational integrity of publicly trustworthy blockchains rather than creating a new chain over and over again. This means that transactions are securely verified on both chains. BiFi relies on cryptographic proofs to verify the accuracy of transactions that occurred on the Bitcoin network. These proofs are then compared and verified on-chain on Ethereum smart contracts.
This level of verification ensures that all user funds are securely transferred, and the system is protected from possibly fictitious and malicious transaction attempts. On-chain verification is the most surefire way to protect user assets, and BiFi has mastered it.
What’s next for BiFi?
While BiFi is already pioneering BTC on DeFi, the innovation does not stop there. BiFi developers are currently working to bring their customers a multichain wallet, which will support native-chain features.
Ultimately, the BiFi team is looking to dive deeper into BIFROST’s multichain capabilities in order to promote this technology and connect cross-EVM and non-EVM networks through the BIFROST Multichain Dev Suite.