Bitcoin DeFi project Badger DAO diversifies its $21 million treasury

 Bitcoin DeFi project Badger DAO diversifies its $21 million treasury


Badger DAO is likely one of the solely Bitcoin-focussed DeFi merchandise in the marketplace and is increasing its ambitions.

Forwards for Badger

Badger DAO, the Bitcoin-focused decentralized finance (DeFi) protocol, has diversified a $21 million treasury by way of its “strategic companions,” the undertaking said this morning. The companions shall assist add worth to the DAO’s governance together with bringing long-term Bitcoin liquidity.

The transfer got here after the Badger Enchancment Proposal (BIP) 37 [Treasury Diversification through Strategic Partnerships] was handed earlier in February. 

Based final yr, Badger brings Bitcoin to DeFi by constructing out usecases for ‘wrapped BTC’ merchandise. Over $2 billion price of varied cryptocurrencies is locked on Badger, $36 million in annualized revenue has been generated, and a treasury of $600 million has been amassed by way of Badger (a governance token) and DIGG (elastic provide crypto pegged to Bitcoin).

The protocol’s now taking its aspirations a step forward. As per the announcement, the brand new strategic companions—crypto funds Polychain Capital, Parafi Capital, and Blockchain Capital, and nameless DeFi investor “0xB1”—would now be concerned in governing the platform, serving to the protocol develop, present long-term liquidity, and constructing extra synergy with different institutional funds.

“Over the previous yr, near 1% of circulating Bitcoin has migrated to Ethereum’s DeFi ecosystem and made productive in numerous yield producing alternatives,” mentioned Santiago Santos, a accomplice at ParaFi Capital.

He added as extra Bitcoin holders seemed in direction of interacting with DeFi apps, Badger would seize the rising share of that demand.

Jacob Phillips, a Technical Researcher at Polychain, mentioned that by aggregating current Bitcoin DeFi protocols, constructing out a collection of latest BTC-focused DeFi merchandise, and economically aligning a group obsessed with BTC in DeFi, Badger was shortly turning into a Schelling point for each new and current Bitcoin liquidity.

Not a 21 meme

Within the launch, Badger mentioned the treasury diversification marked the beginning of the “Badger Backstop” fund—an effort that will see continuous improvement in direction of securing consumer property and rising the protocol “whatever the market situations.”

The discharge mentioned:

“We plan to make use of a portion of the DAO capital to create an insurance coverage fund, offering elevated platform safety for our customers — which can drive elevated TVL in the long term.”

Doing so would keep away from the state of affairs of protocol improvement ceasing in case of an unfavorable market (final seen within the aftermath of the notorious 2017 ICO bubble).

In the meantime, regardless of the “21” meme (of there being 21 million Bitcoin, 21 million Badger, and the $21 million diversification), Badger mentioned the transfer was simply the beginning of three upcoming diversification. The staff mentioned it might proceed to seek out the fitting companions to develop Badger and construct belief within the protocol.

“Badgers are relentless, fearless, and unshakeable,” the discharge ended.

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