The post How Lorenzo Protocol is Supercharging Bitcoin DeFi With Liquid Restaking appeared on BitcoinEthereumNews.com.

We do the research, you get the alpha! Get exclusive reports and access to key insights on airdrops, NFTs, and more! Subscribe now to Alpha Reports and up your game! Go to Alpha Reports Bitcoin is the original cryptocurrency—and dominates the market as the largest crypto by market capitalization. But as a trailblazer, it also suffers from limitations that have been addressed by the cryptocurrencies that followed in its wake. Those limitations—Bitcoin’s slow consensus mechanism, limited data storage capacity and lack of smart contract compatibility—mean that much of Bitcoin’s liquidity is cut off from the flourishing decentralized finance (DeFi) space. That’s what Lorenzo Protocol is aiming to address with its novel Bitcoin liquid restaking protocol. Liquid restaking builds on the existing model of liquid staking, which enables investors to participate in staking on proof-of-stake blockchains, while still retaining their personal liqudity. Lorenzo Protocol’s liquid restaking enables users to stake the stBTC derivative token that represents their staked asset across multiple blockchains, earning additional yield from their staked Bitcoin. “We are a platform to help stakeholders to lend BTC liquidity to the projects needing them for scale, and then to provide the yield from these projects,” Lorenzo Protocol founder Matt Ye told Decrypt. He added that, by tokenizing the lending and borrowing of BTC liquidity, it effectively creates BTC bonds. “First of all, we’re matching BTC holders with all the projects for BTC yield,” Ye said. “Two, we do the tokenization for staking.” “On top of that, we build StakingFi or YieldFi application layers on top of them,” he added. The platform uses the Lorenzo Appchain, an EVM-compatible Bitcoin Layer 2 network that’s secured by BabylonChain’s Bitcoin shared security. “This L2 is in charge of the issuance and settlement of these staking tokens, and then also for building the DeFi ecosystem…

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Filed under: News - @ May 18, 2024 8:04 am