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๐Ÿ”ฎ What is eBTC?
๐Ÿ”ฎ What is eBTC?

Introduction to eBTC: The Decentralized Synthetic Bitcoin Protocol.

hyment avatar
Written by hyment
Updated over a week ago

Introducing eBTC

eBTC aims to provide a transparent, self perpetuating and censorship-resistant infrastructure for accessing synthetic Bitcoin within the Ethereum ecosystem while minimizing custodial risks and ensuring the highest level of transparency.

The protocol uses Lido's staked Ethereum (stETH) as collateral to mint eBTC tokens. Users can borrow eBTC by opening Collateralized Debt Positions (CDPs), where they have the option to deposit various forms of ETH. For any deposit that is not already staked, the protocol will zap into Lidoโ€™s stETH on behalf of the user. These CDPs maintain a collateral-to-debt ratio to ensure solvency.

The high correlation between BTC and ETH significantly reduces liquidation risks for eBTC positions and enables the protocol to establish a minimal collateralization ratio as low as 110%.

This positions eBTC as the most efficient synthetic Bitcoin derivative, offering a wide array of use cases ranging from trading to leveraging stETH yields.

๐Ÿ”ญ Discover eBTC's key features

eBTC features fee-less borrowing (no interest, no opening or closing fees), a revolutionary concept underpinned by its transparent and immutable structure. Unlike traditional models burdened by upfront fees and interest, eBTC borrowers enjoy a seamless experience through a novel revenue model based on Protocol Yield Share (PYS). This groundbreaking approach not only encourages accessibility but also ensures the protocol's sustainability.

Get Paid to Borrow Bitcoin. Since it's collateralized with yield-bearing stETH, eBTC generates yield and enables users to enhance it through multiple swap and borrow cycles.

Transparency reigns supreme within eBTC. With its transparent Minimized Governance model, eBTC preserves the core properties of the protocol as immutable, while granting token holders delegated authority to adjust less critical parameters. It was meticulously designed to uphold principles of censorship resistance and safeguard users' trust assumptions. This setup allows for adjustments in areas crucial for competitiveness, stability, and overall security.

We welcome you to dig deeper and explore the other pioneering features of eBTC via the rest of the comprehensive Help Center articles available. Take the Purple Pill.


โ“ If you find yourself in need of additional assistance along your eBTC journey, feel free to explore our Support Help Center or directly contact us. We're here to address any questions or concerns you may encounter within the eBTC ecosystem. Just click the chat button at the bottom right-hand corner of the screen and send our support team a message.

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