Bitcoin DeFi is a growing market segment in the Bitcoin ecosystem, bouyed by the growth of the Bitcoin Layer 2 protocols.
Read on to discover a list of four of the most popular Bitcoin DeFi platforms.
Sovryn
Sovryn is a decentralized trading and lending platform that runs on Rootstock and Build on Bitcoin (BoB) with a mission to empower decentralized Bitcoin services.
The DeFi app supports trading, lending and borrowing of bitcoin via a permissionless and non-custodial manner. Users who participate in these activities can also earn investment income on their BTC holdings by providing liquidity to various staking pools on Sovryn.
The platform is known for its quality security features, a growing list of financial technology tools and up to 5X leveraged trading products. Sovryn also has a governance token which allows holders to participate in decentralized decision making.
Pros
- Supports permissionless non-custodial trading
- Offers decentralized lending
- Has multi-chain support
- Staking feature that rewards long-term participation
Cons
- Newbies may find the user interface too sophisticated
ALEX
Alex is a decentralized finance protocol that provides a comprehensive suite of financial technology products on Stacks by leveraging the security standards of Bitcoin.
The protocol offers DeFi services that include yield farming, staking, lending and borrowing of bitcoin and bitcoin-native assets. The platform operates on the Bitcoin Layer 2 protocol Stacks but has also integrated assets from other blockchains to bolster liquidity and give its users flexible investment options.
Pros
- Offers decentralized trading of bitcoin-native assets
- Provides yield generation opportunities
- Staking feature that rewards long-term participation
- Interoperability widens pool of investment options
Cons
- Has limited liquidity relative to more established platforms
- Newbies may find the user interface too sophisticated
Arkadiko
Arkadiko is decentralized finance protocol built on Stacks that facilitates minting of stablecoins and yield farming against bitcoin asset holdings.
Arkadiko participants need to collateralize their bitcoin holdings to mint stablecoins, which provides easy access to liquidity without the need to sell assets. There are also ample yield farming opportunities on the platform that allow you to earn yield farming rewards on your stablecoin and bitcoin assets.
Moreover, users can also earn additional rewards by staking their Arkadiko tokens (DIKO), the native token that powers Arkadiko.
Pros
- Ample yield farming opportunities
- Staking feature that rewards long-term participation
- Interface is easier to use relative to other Bitcoin DeFi apps
Cons
- Limited range of supported assets
- Newbies may find the user interface too sophisticated
Velar
Velar is a new decentralized finance protocol that provides a comprehensive suite of financial solutions, including DEX swap, staking, lending and borrowing.
This platform offers DeFi trading services under one roof, but goes a step further to provide an intuitive user experience, advanced security and a holistic financial ecosystem.
Pros
- Offers a wide range of decentralized investment products
Cons
- New platform with limited liquidity
- Newbies may find the user interface too sophisticated
Final Take
As the Bitcoin ecosystem and the crypto industry continue to mature and accommodate more DeFi applications, the likes of Sovryn, Arkadiko, Velar and ALEX are paving the way for decentralized products and services secured by Bitcoin.