The latest upgrade to coreBTC introduces a significant enhancement by allowing Lockers to use multiple assets as collateral. The first supported asset, in addition to the CORE token, is the liquid staking token stCORE
This feature enables Lockers to earn yield on stCORE while using it as collateral, transforming it into a productive asset. By incorporating stCORE, which appreciates over time, the risk of collateral liquidation decreases, enabling Lockers to potentially manage more BTC with the same collateral over time.
Solving Previous Limitations
Unproductive Collateral: Previously, when Lockers used CORE as collateral, the asset remained locked and unproductive, not generating any yield.
Risk of Liquidation: Collateral value could fluctuate, increasing the risk of liquidation during market downturns, leading to potential loss of collateral and the inability to maintain BTC positions.
New Features and Benefits of Multi-Asset Collateral Support for coreBTC:
Multi-Asset Collateral: Enables the use of stCORE alongside CORE as collateral, diversifying the asset base and enhancing stability.
Yield Generation: Lockers can earn yield on stCORE while it is used as collateral, turning previously unproductive collateral into a productive asset.
Reduced Liquidation Risk: The appreciating value of stCORE over time reduces the risk of collateral liquidation, providing greater financial security.
Enhanced BTC Management: Allows Lockers to manage more BTC with the same amount of collateral, assuming stable token prices.
Additional Collateral Types to Add Scalability to coreBTC
The introduction of additional collateral types, including stCORE, is an enhancement that addresses the scalability needs of coreBTC. Not all Lockers hold CORE, and by supporting multiple collateral types, the system becomes more inclusive and flexible for a broader range of Lockers. This upgrade allows Lockers to diversify their assets, providing greater stability against token price fluctuations and reducing the risk of liquidation.
Enabling multiple collateral options is crucial for the long-term scalability and resilience of coreBTC. Diversification helps in mitigating risks associated with holding a single type of collateral. With a diversified portfolio, Lockers are better positioned to manage volatility and protect their assets, ensuring a more stable and secure DeFi environment.
About Core
Core is a Bitcoin-powered blockchain unlocking EVM-Compatible BTCfi beginning with the first ever implementation of Non-Custodial BTC Staking and the world’s first yield bearing BTC ETP. Core is the most Bitcoin-aligned EVM blockchain with ~55% of Bitcoin mining hash power contributing to the network’s security and over 4,800 BTC natively staked in exchange for unlocking Bitcoin utility and rewards. This breakthrough has amassed millions of Core adopters - over 19M unique addresses and 260M transactions since its mainnet launch in January 2023.