Sovryn - DEFI on Bitcoin

Let's take a look at: https://www.sovryn.app/ #DEFI on #BTC

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Sovryn - DEFI on Bitcoin, no longer a promise… now it’s a reality!

In a previous post I talked about the RSK blockchain and how it is the best combination of Bitcoin’s security and Ethereum’s operability.
Today I want to speak about one of the most exciting projects running on this chain, a DAPP (decentralised application) called Sovryn.

The aim of this organisation (which runs as a DAO) is to finally bring decentralised finance (DEFI) to Bitcoin. Before it was only on chains like Etherum where one could find this type of protocols, the main Bitcoin chain does not allow for their deployment. It is for that reason that a layer 2 (like RSK) was needed to make this finally happen.

The main difference between decentralised and centralised finance is that in the later case, all the funds are provided by the users. They can add liquidity to pools that consist of two assets (for example BTC\ETH) and earn rewards from them.
The DAPP allows for borrowing and lending as well, adding margins to your trades and all sorts of features.
Right now they are working on a smart contract that would enable you to borrow StableCoins using your Bitcoin as collateral at 0% interest rate, so that you never have to sell your crypto assets again.

Because you would be lending money to yourself you also don’t have any deadlines as to when the payments should be made to get your collateral back. And, theoretically, if the value of the Bitcoin used as collateral keeps growing, the amount that you would need to pay back would go down. The loan could, in essence, pay itself.

As crazy as all this may sound, Sovryn has been deployed last year and has been working without flaws. True, the price of its token has taken a big hit during these uncertain times. But both the project and the team remain as strong as ever, for my part, I’m still holding all my tokens and believe in what they are attempting to build.

Bitcoin gave us money separate from state and financial institutions. With Sovryn’s help it will now also give us all the rest of the financial services in a decentralised, permissionless and censorship resistant way.

Do not take my words as a recommendation for investmenting, only as an advice to look into this wonderful emerging world of Bitcoin Layer 2.