Bitcoin Staking on Stacks is officially LIVE.
@UTXOmgmt, @21shares, @HashKeyCloud, @syphercapital, and @FireblocksHQ are the inaugural participants in the Genesis Bond, the first institutional bonding period.
Institutional Bitcoin now earns native BTC yield while staying on Bitcoin L1.
Stack Sats is live: 3 BTC in rewards over 90 days for putting your Bitcoin to work on Stacks.
Start participating through @ZestProtocol or @bitflow ๐ง
Thereโs something different about seeing the first BTC reward actually hit your wallet!
The @Stacks Genesis Bitcoin Staking Bond began as a thesis and has now proven that Bitcoin can serve as productive capital.
BTC was put to work
blockstack:native earned $BTC
The first yield is accruing in Zest Protocol's Levered Bitcoin Staking Vault on @Stacks.
The vault share price is starting to reflect the strategy's returns. Holders can track that change directly in the app.
Bitcoin-native finance isn't one app, it's a whole stack.
Vaults, lending, market making, AI infrastructure, stablecoins. All settling on Bitcoin, all built on Stacks.
Iโve been testing an sBTC loop on Zest Protocol on @Stacks.
They're currently running an incentive campaign for 0.5 BTC every month.
Here's a quick farming guideโ
1. $sBTC + $USDCx
This is the loop I tested first, since USDCx borrowing is also part of the incentive campaign.
โ Supply sBTC on @ZestProtocol
โ Borrow 40-50% USDCx against it
โ Swap the USDCx into more sBTC
โ Supply that sBTC back into Zest
โ Repeat several times
Iโm personally aiming for roughly 50-55% LTV.
With USDCx debt, partial liquidation starts at 70%, so that leaves me roughly a 15-20% BTC drop before reaching the liquidation threshold.
Just keep monitoring the price, and it'll be okay.
2. Other loops
USDCx isnโt the only asset you can borrow against sBTC.
The debt you choose basically changes what youโre trying to achieve with the loop:
โ sBTC
Borrow sBTC and resupply it. Since the collateral and debt move together, thereโs much less price mismatch, which is why Zest allows up to 80% LTV.
โ USDh
Works similarly to my USDCx strategy. Borrow the stablecoin, swap it into more sBTC, then resupply. The difference right now is that USDCx borrowing qualifies for the new incentives.
โ STX / stSTX
Borrow either asset, swap it into sBTC, and resupply. This becomes more of a relative-value trade because you benefit if sBTC performs better than the asset you borrowed.
The last one carries much more cross-asset risk, which is reflected in the much lower 30% max LTV.
So all three are pretty similar. The main difference is the level of cross-asset risk.
Again, I'd go for borrowing USDCx because of the incentive campaign.
3. TL;DR
For this, I'd say choose a strategy based on your short-term outlook for Bitcoin:
โ Bullish on BTC - USDCx/USDh debt gives the most direct leveraged BTC exposure.
โ Neutral on BTC - sBTC debt makes the most sense if the supply/borrow spread and incentives justify it, since Iโm not really taking a BTC directional bet.
โ Bearish on BTC - sBTC debt is the more defensive loop because the collateral and debt fall together.
Realistically tho, reducing leverage is safer than trying to optimize a loop for a BTC drawdown.
Overall, thereโs no single best loop here.
Personally, my focus is on the incentives.
Disclosure: Iโm a long-time $STX holder and Stacks supporter.
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Win Bitcoin daily. Get paid for trading it. Earn for market making.
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DeFi yield opportunity from Zest
Stacks endowment is funding Zest lending market with around 0.5 BTC in $STX every month, and it gets split evenly between two actions
> the easiest one is just supplying sBTC, no loan, no vault, around 0.6% APY when including the $STX incentive rewards
> the other half goes to USDCx borrowers, but only if your position stays above 20% LTV. the budget is measured in $BTC and paid in $STX, so check what that actually looks like at current prices
check more below, already did a small testing supply too
Two ways to qualify for Zest Protocol's upcoming incentives on @Stacks:
Supply sBTC. No borrowing required.
Borrow USDCx at 20% LTV or above. Get paid to borrow.
3 BTC in rewards for borrowing and providing liquidity with USDCx, over the next 90 days on Stacks.
The program rewards the primitives that make Stacks DeFi stronger.
This is the first phase of a longer arc. Bitcoin Staking brings Bitcoin onto Stacks.
This program is about what that Bitcoin does once it's here: backing loans, deepening liquidity, going to work.