Tortola, British Virgin Islands, 12th July 2023, Chainwire

In an ongoing effort to reshape the cryptocurrency investment landscape, Struct Finance, a DeFi platform that allows investors to participate in interest rate-matched products linked to digital assets, has announced a BTC.B-USDC vault. We are pleased to announce the launch of

A tranche-based BTC.B-USDC interest rate product is made possible by effectively leveraging Avalanche’s BTC.B (Bridged Bitcoin) for DeFi applications. The new vault beautifully complements Struct Finance’s Genesis USDC Vault and ushers in an exciting era of DeFi yield opportunities. Struct Finance builds a new vault on top of GMX’s Liquidity Provider Token (GLP), leverages safe assets, and minimizes volatility and risk while trading BTC and variable returns in the form of fixed returns. generated a predictable yield of USDC in the form Other Risks.

“Our BTC.B-USDC vault represents a revolutionary application of Bitcoin in DeFi. It is bringing a new wave of opportunities to the world,” said Ersin Dalkali, co-founder of Struct Finance.

Bitcoin continues to dominate the market, but native yield generation has traditionally been very difficult due to Bitcoin’s inherent lack of a DeFi layer. Avalanche has unlocked new possibilities for Bitcoin in DeFi with BTC.B (Bridged Bitcoin). Unlike WBTC, which relies on a centralized bridge, BTC.B is generated via a distributed bridge, the Avalanche Core, and can be trustlessly bridged between networks using layer zero bridges.

Bitcoin investments in prominent lending pools currently yield 0.2-0.5%. Even stable swap pools offering wBTC-BTC.B products have only achieved returns of around 2%. Struct’s BTC.B-USDC product breaks these limits and offers significantly higher yields.

The purpose of BTC.B is to allow BTC holders to explore DeFi opportunities on the Avalanche blockchain without acquiring secondary tokens or relying on centralized bridges. BTC.B represents her BTC coins transferred to the Avalanche blockchain in the form of ERC-20 tokens. With a bridge of over 6,000 BTC and a fully diluted value of $180 million, BTC.B is carving out a niche in the crypto space.

The Bitcoin ETF application by BlackRock, WisdomTree and Invesco, three of the world’s leading asset managers, is more than just an application. This is a signal that the traditional financial realm is ready to accept Bitcoin at a new level. Recently, the U.S. Securities and Exchange Commission (SEC) green-lit his 2x leveraged Bitcoin ETF, sparking a wave of feverish speculation and anticipation for the approval of a Bitcoin spot ETF.

delta hedge

In a highly volatile crypto industry, Struct Finance’s interest rate products allow anyone to split and re-risk a yield-bearing DeFi asset into different pieces through an innovative process called “transcing.” It can be packaged and adapted to your risk profile. All interest rate products are single vaults divided into two parts or tranches with different return structures.

  1. Fixed return tranches for conservative investors looking for stable returns
  2. Variable return tranches for investors with a high risk appetite and seeking superior returns

Yields from the underlying assets first flow into the fixed tranches to ensure predictable returns. The remainder is then allocated to variable tranches to enhance exposure to the underlying asset. Compared to fixed tranches, floating tranches can yield higher, lower, or even zero yields.

As part of the BTC.B-USDC vault, Struct Finance implemented delta hedging, a unique approach to managing investment risk. While the fixed tranche plays a central role in its high yields, the variable side of the product offers an interesting additional layer of complexity and potential.

Once the funds are deployed to the vault, the fixed tranches of BTC.B are converted into GLP tokens on GMX, creating a position short Bitcoin against GLP, resulting in a negative delta. In contrast, USDC on the moving side essentially translates into his GLP with a positive delta.

This innovative delta hedging instrument design achieves a delicate balance between positive and negative delta forces. This provides a robust strategy that allows investors to confidently navigate the inherent volatility of the cryptocurrency market.

This artful interplay of fixed and volatile sides within the vault opens the door for investors to tap into unprecedented Bitcoin investment potential. By catering to diverse risk appetites, Struct Finance ensures that both retail and institutional investors can customize strategies that maximize profits regardless of market conditions.

About Structure Finance

Struct Finance is at the forefront of the DeFi revolution with a vision to transform the design and utility of financial products. This allows users to design their own financial instruments and harness the power of tokenized high-yield positions to open up a world of diverse investment opportunities. Additionally, the company’s cutting-edge financial products employ a tranche-based system to intelligently distribute yields among different investor classes. This balanced approach guarantees stable yields for risk-averse investors, while offering high earnings prospects for more adventurous investors. Initially available on Avalanche, Struct Finance plans to make it multi-chain in the near future.

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Disclaimer: This release is for informational purposes only and should not be construed as a financial promotion.

contact

Miguel Depas
[email protected]

By Jules

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