Merlin Chain transforms Bitcoin returns with DeFi possibilities
Merlin Chain, a Layer-2 blockchain platform, has revealed plans to introduce fresh yield opportunities for Bitcoin (BTC) traders, as per details shared with Finbold on June 12.
Utilizing Proof-of-Stake (PoS) consensus mechanisms and an array of innovative decentralized finance (DeFi) solutions, Merlin Chain is aiming to offer bitcoin holders the chance to earn staking rewards and access a variety of DeFi services.
Historically, Ethereum (ETH) investors have had access to various avenues for generating yield, such as staking rewards, liquidity mining, and yield farming.
On the other hand, holding BTC has not provided similar benefits, aside from the asset’s gradual increase in value. Founder of Merlin Chain, Jeff, highlighted the strong market position of BTC while pointing out the lack of yield opportunities for its holders.
To capitalize on Merlin Chain’s yield offerings, users will need to bridge their BTC to the network via the Merlin Bridge. This process involves locking BTC on Layer1 and receiving gas BTC, which can then be staked in Merlin’s PoS mechanism to generate M-BTC, a wrapped bitcoin asset that earns staking rewards like stETH.
Bitcoin holders can stake M-BTC on DeFi platforms such as Solv Protocol to earn SolvBTC and access a range of DeFi services. They can also provide liquidity to earn yields from Merlin-integrated protocols and explore DeFi functionalities like lending, borrowing, derivatives trading, and other DeFi activities with BTC.
Furthermore, they have the option to bridge SolvBTC assets to Bitcoin Layer2 networks like Linea for additional rewards.
Merlin Chain has recently bridged over $13 billion worth of bitcoin in the past month and a half, distributing over $700 million worth of BTC to Layer2 networks. The platform has established partnerships with prominent crypto custodians like Fireblocks, Cobo, Ceffu, and Antalpha.
In total, Merlin Chain collaborates with more than ten major institutions to expand participation and decentralize the network’s validator set, signaling a new era for Bitcoin and Merlin Chain.
