DeFi By Design EP#47: Earn Interest On Your Bitcoin w Badger

Transcript

[Music] d5 slate team [Music] what's up y'all real quick if you like the d5 state content on twitter and youtube and sub stack please please give us a like and a subscribe on this video on youtube and join our channel join the community we'd really appreciate it we're pumping this stuff out for you all as much as we can and we really enjoy the support and the community that we've built thank you very much enjoy what's going on guys welcome to episode 47 of the d5 by design podcast uh we are here today on a beautiful day in florida uh i'm back home here about to meet up with robbie soon um and yeah we're we're

hanging out uh today with chris from from the badger protocol the honey badgers gorar i'm sure you've seen some crazy videos uh on youtube of honey badgers going after rattlesnakes uh honey badgers are an interesting animal but today we're gonna be talking further about d5 the collaboration of nfts and d5 um some of the of the vision of what what kind of what is going to bring d5 back to the forefront uh in terms of attention and and the narrative um and yeah guys in in this episode uh you'll learn about the interest bearing opportunities of bitcoin how you can kind of bring your bitcoin into the defile world so if you are a bitcoin holder you know on cash app or on coinbase or you have a ledger

right you're going to hear some interesting information about how you can earn some yield uh and some boost on that bitcoin as well as the gamification of d5 um and i think that a lot of the reasons why nfts have done so well recently it's because they're a lot of fun so i think if we can bring that fund into d5 you know i think we'll see some really interesting growth um so all these things to be explored in this podcast so guys sit tight enjoy um and i'll pass over to rob yeah what's up andy so super stoked to have chris from badger on the uh on the podcast today and and you mentioned gamification um in d5 and i think that's that's huge we've kind of seen just these primitive financial products that are unlocking a lot of markets but it's it's only entertaining because

like it's something new and i think people thrive off that so bringing nfts and more traditional gamification mechanisms to defy i think it's gonna further onboard people um and and make d5 more comfortable more fun more entertaining um and ultimately yeah on board a lot more of the masses um i don't know too much about badger so i'm i'm stoked to dig into the platform a bit more um i have heard just the amount of overwhelming demand that there is for bitcoin on ethereum on these other chains um like one percent of bitcoin i believe is now wrapped and put onto ethereum and and on to other chains in d5 um so i know

badger is one of the leaders in the space um and just keen to explore badger and all the possibilities there with chris so i'll pass it over to you chris and let you introduce yourself what's up boys having me glad to be here and uh and just chat and rap about uh whatever you guys want to rap about gamification sounds fun d5 sounds fun and of course like i was talking about badger gets me fired up um but yeah just to give everybody a little bit of an intro badger's been around now about almost a year about nine months 10 months in that range and really you know it's it has a singular focus and that's to bring bitcoin to d5 um

for those that don't know what that means you know if you have bitcoin so there's you know there will only ever be 21 million bitcoin and a large percentage of that bitcoin's been mined already but that lives on the bitcoin network and the bitcoin network and the ethereum network are two different networks and other you know you can there's a bunch of other blockchains of course as well but until the last year um i think in the beginning of 2020 there was only a thousand bitcoins that were actually brought over to other networks to be leveraged and utilized and then some people will say like well why would i even bring my bitcoin over there well on these other networks like on ethereum there's different use cases for that bitcoin and people call them

decentralized finance applications but these applications allow users to do different things with their digital assets that could be lend them out turn some interest that can be borrow against them if you have different types of strategies that could be deposit them into you know a platform that generates interest for you through different types of strategies something similar to what badger does there's a whole slew of different things um that you can do including like trading them exchanging them on decentralized exchanges and things along those lines so um we started badger we we have this belief that uh bitcoin is um the the ultimate digital asset um and um ethereum and of course other changes but ethereum primarily is the you know the

best permissionless platform ever made so how do we bridge the two and be the proponent to help people not only bring the bitcoin to ethereum and other chains but also to give it utility when it's there and build the applications necessary for them to put it to work so that was you know the premise uh but different from from many businesses or organizations you know we're not you know a centralized entity legal entity with you know a ceo and all these different people and all you know things along those lines uh we're a community-run business so from launch we've had i think almost 66 or 67 different proposals but we have a governance infrastructure and anyone that holds badger tokens has

a say in how the business makes its decisions how it manages its money how it invests that money how it progresses the product and a variety of different things like that so you know our vision has always we believe that there's going to be hundreds of thousands of decentralized organizations because the people are going to demand transparency and want to have a say into the applications or products that they use every day and we're trying to spearhead that so badger is built by the community for the community everyone in our community is a honey badger we share a similar value belief system we're relentless we're fierce no one can [ __ ] with us and we're small but mighty so that's um that's a little bit about badger we have a whole school of products all folks are on bitcoin and

more than happy to to jump into what that looks like sweet yeah it's awesome um i i mean all all the above sounds great it's it's been an interesting experiment really to see this transition of bringing bitcoin on to ethereum um you know there's a lot of hardcore bitcoiners who kind of are against the whole idea there's a lot of people who have bitcoin and are just willing to transfer it over you know what i'm kind of curious as a as a cold storage bitcoin holder myself in the premise of not wanting to take any uh you know extra risk with withholding that asset what's kind of the way that you guys have gotten over the obstacle of like okay if you're you know for our listeners if

you're if you're a bitcoin holder you know on a ledger bring your bitcoin over to ethereum so handling that process and then also staking it to earn you know any yield on badger what's been the process there as far as onboarding those people who are kind of let's say risk averse when it comes to holding inco in cold storage um you know what's the what's the what's the pitch or what's the process there for uh for our listeners who who hold some bitcoin you know but aren't too sure about moving it over to ethereum and and experimenting well in the end of the day it all comes down to you know a risk and reward um profile like at this point in the in the the technological curve you know it's

super early so that brings like a bunch of additional risks that's most people might not be comfortable with and like that's one thing that i always tend to say is like you know anything that you're going to be using and touching now is very risky right so if you aren't comfortable with a higher threshold of risk regardless of the returns are like don't even bother and things are going to get much less risky as smart contracts get more battle tested and there's more capital in the system and there's more infrastructure to this builds around it but today it is on the riskier scale if you were to look at it as a scale um but for the most part those that are bridging which again and i think alex suggested this you know only one the number's at one point two five percent of all bitcoin it's like

275 000 bitcoins has now been bridged over and being used so that just that's like super small right like it's only a percent it's nothing but you know bitcoins represents 50 of the market cap of the entire cryptocurrency industry so that is a substantial amount of capital billions of dollars um so today you know there is still an enormous amount of people that aren't doing it but the people that are doing it from what from what we've gathered is people that you know they're looking for a bigger reward they don't want to just sit on their bitcoin and keep it in cold storage um they want to be able to earn more and get more out of it at the same time you know with the explosion of defy and open source platforms like

badger although you are moving it from cold storage and you're bringing it to another network and there's obviously different custodial risks associated with the bridging aspect when you're there it's very much so attuned to you know being able to hold and control your keys and your assets so many d5 platforms including badger um you know we don't control your keys you don't have to like send bitcoin to us and then worry about us custody and it and all this type of stuff like you hold your keys you can deposit and withdraw anytime you want you can see to the second exactly what's happening with your bitcoin um and many other protocols are like this sushi yearn a variety of

others so that that's the big difference right like today um there's very little options earned interest on your bitcoin the options that you do have requires you to trust another counterparty you need to go to a block buy a celsius a group like that and just say hey here's my bitcoin then you don't know what happens after that right it's like a black box and personally i feel that's enormously more risky than you know using decentralized technology to bridge your assets over and then to have control of your assets and know exactly what's going on with it but as it relates to badger we have a badger bridge where you can come with native bitcoin use your ledger device use your treasure use whatever device or software wallet you want to use and you can bridge it um

onto ethereum right in our app and the apps app.badger.finance and you'll see the bitcoin bridge there uh once it's there there'll be a whole slew of different things that you can do with it uh there's a variety of different we call them set vaults or vaults that you can deposit your bitcoin into each of those vaults have a different smart contract strategy so they have a different way of earning interest and that's reflected in the amount of interest that you can earn so you would pick which one that you'd want to deposit into and then once you deposit into there um then you you can really just sit back and and let the smart contracts do the work and whenever you want to withdraw you can withdraw and there's a whole bunch of other things that you can do once you're deposited but that's more

for like an advanced user um you know getting ib btc or you know participating in boosts and things along those lines but nonetheless uh answer your question andy like that's that's what you know that's what it is cool yeah and chris you mentioned the the native badger bridge um and and how you guys are deployed on ethereum and and it's really the prime place to earn interest on your bitcoin um for someone that has kind of gotten over uh you know trusting smart contracts and uh they take that step like okay i'm ready to bring my bitcoin maybe out of cold storage i still have my private keys and i want to earn some interest on

it what is the the reason why well to take a step back you know defy on bitcoin is is i guess starting to pick up a little bit of steam and it's not something that we really have covered too much on on this show i'm keen to understand if you think that has any runway um and if you know so someone is ready to to earn interest on their bitcoin um you know why would they why would they move it over to ethereum uh if there is a potential to earn interest on the native bitcoin blockchain well there isn't today and it won't be for a long time um any of in my opinion any of the risks

associated with using the solutions that exist today which most instances are side chains uh that use the underlying security of the bitcoin network but you know you're not actually on the bitcoin network in most cases um you know i i personally i trust you know the ethereum network and the underlines of the ethereum network much so much more so than the um potential side chains of bitcoin but also um the uh the compatibility of all the tools and ecosystem that exists around it so for example like in the ethereum ecosystem there's so much more you can do with that bitcoin it's not just like one singular solution so based on your risk tolerance you can look at more immature

protocols more more mature protocols you can get insurance you can do a variety of things that really doesn't exist um with uh d5 on bitcoin and you know i'm not saying that it would never be a thing i do think there's going to be a place for it and i'm not against it by any means but today it's much more immature than um you know then bitcoin on ethereum or any of these other chains right there's you know put in perspective there's more bitcoin sitting on polygon or avalanche than there is you know and nothing like or being used in some of the the final bitcoin um solutions that exist out there yeah and maybe this plays into your your vision of how the multi-chain really

fits together um but i i agree with you i i don't think bitcoin really uh has the infrastructure for uh handling as many transactions as that are necessary um and even so just ethereum has the infrastructure it has this robust uh community and and system of apple system of applications um that to me is just way far and advanced over any other uh chain at the moment they they just have too much of a first mover advantage uh over any other chain like if bitcoin you know really what was to start driving d5 or polygon or avalanche yeah i think ethereum just has the infrastructure and

it's a robust uh system that can't really be touched uh by some of these other other platforms and shouldn't and shouldn't any bitcoin or really be happy about uh coins moving on to other chains like sure it might contribute to the you know total value locked or to the efficiency of you know ethereum or polygon or avalanche cetera but it doesn't theoretically that lower the supply available on the bitcoin chain right so therefore there's less bitcoin to be had because when you when you transfer that bitcoin over to ethereum it's basically i mean the way that i think about it is it's locked in like escrow for rap bitcoin or for rent bitcoin one to one um type of uh

type of experience and then when you bring it over that you know that that amount of bitcoin is kind of let go so theoretically it should even uh you know shorten the supply of bitcoin on the main chain yeah most certainly well you know i just come from a place like and i've been i've been a bit corner for a long time i've been an ethereum enthusiast for a long time like you know math there's no place for maximalism on any side of the fence right like this is one you know big fight that we're trying to create a new financial system we're trying to create new money we're trying to break down borders we're trying to do some crazy stuff and we need everyone to work together to accomplish this so like these maximalism fractions within the ecosystem i've always believed them to be stupid and i

i don't think they'd really do any good for us it's just a way for people to talk [ __ ] on twitter and whatever the hell they want to do right so we just need to come together and and have more of um a joint effort because that's the only way we're actually going to win the real fight and the real fight is is what i described earlier chris maybe you could unpack that a bit more like you know we're changing we're making new money we're making a new financial system um what is the real fight like is there an obstacle or an opponent here or is it simply just evolution well you know honestly many would argue and i and i would argue um is you know the fiat system is broken and then the banking systems are broken

right these are not sustainable you know something that could be hundreds of years um like their models at the core are broken so when you look at those things you know that's what we're trying to to build we're trying to build an open financial system and financial system where there isn't a bunch of bloated middlemen taking a cut all the way down it's it's peer-to-peer it's two people with two specific needs that are able to interact with each other while controlling their assets and dictating the terms of that interaction no matter if you're in florida or if you're in afghanistan or if you're in toronto if you're in china if you're in russia like it really doesn't matter wherever you are in the world you have the ability to have financial services on your terms

and then from a fiat perspective you know i don't i don't want to have to you know go down the field over bitcoin like bitcoin is a superior currency um in every sense of the matter and um you know i think that you know over time a global currency a borderless currency um a currency uh a fixed currency i think will uh be able to to win the the overall fight it's not going to be you know there's a lot of people with power here that you know have vested interest in not letting these systems go away and it's not going to be something that happens anytime soon it's going to be a really long effort and it's going to be something that takes a very long time but it's you know you can't refute technology this is part of the

technological revolution that we've been in uh for a period of time and it's just in my opinion it's just the beginning of um of what that revolution is going to look like awesome yeah i mean that that's been the the ethos of of the ecosystem for some time um you know and it never gets old kind of hearing it and reminding yourself amidst all the speculation and games and and madness kind of what everybody's here for uh to accomplish together really and try to grow i mean i think we're just now seeing these larger players come into the space and kind of really establish positioning we had a visa by a crypto punk right even more so signaling their uh their desire to get into the space they

didn't buy bitcoin they didn't buy anything they bought a crypto punk it's just any kind of an interesting concept there um but just getting these larger players in and i'm a lot of the larger players that have that are in in the game were early bitcoin users or adopters um people you know people who started funds early who invested early with you know small investment club s groups um and now even so much larger banks and um and such like that so i'm curious what your experience and everyone's a bitcoiner andy everyone's a big corner no matter how i always like to say this everyone's a badger because if you've been in this space for any period of time um your your most likely your most uh likely entry was bitcoin a friend telling you hey buy some bitcoin or you

know you looking at the risk and reward or you know from a security perspective or even from a distribution a daily perspective like bitcoin represents half of the market cap and it's in and it was like you know 80 and 70 the last few years right so everyone um that's in crypto either has bitcoin or had bitcoin in my opinion uh the percentage of people that that hadn't are unbelievably small and that's um that's you know what i think to be a fact but that's where i like to say everyone's a badger because if you have bitcoin then you're a badger exactly and i mean some of these larger players who have been getting into bitcoin they need to know about this opportunity to earn yield so have you guys had any talks with any you know

large large whales about uh bringing their bitcoin into badger you know or thought about maybe creating a more institutional level feel platform you know for you know for these types of players to kind of bring their bitcoin into into badger what what are your thoughts on that and experiences so far we don't yeah we don't talk to like whales or like people right we're not in the market of uh you know trying to convince people to deposit in the app it's an open software and anybody with the wallet we don't need to know who you are can deposit um on the institutional side you know we're we're building for that right we had an announcement earlier this year about an integration with fire blocks which is one of the largest institutional networks uh digital asset

networks with like over three or four hundred billion dollars that have gone through that network um yeah and the way that we see it is you know we're just building smart contracts we're building open source smart contracts and if you think about how institutions get access to lending and borrowing services so like first and foremost like are institutions going to want to get e5 type services and benefits of course they're going to it's like literally that's like what the entire system is built on right you put money in your bank your bank lends it out there's a whole like that's just how [ __ ] works um so when you look at you know what the appetite is going to be it's there it's not too far from what they're already used to it's just a different way of

approaching it there's some compliancy there's operational issues associated with getting there but the way that we see it is you know we we're gonna rebuild and we're gonna continue to advance and build the smart contract that any centralized decentralized platform institutional retail or whatever in the world would want to integrate because if their users have bitcoin in their platform they're going to want to get some type of service for that bitcoin or earn on that bitcoin uh as an example paypal right how much two or three hundred million people use paypal there's an enormous amount of bitcoin cash apps another example obviously a lot of centralized exchanges um and they're not just going to sit

back and let defy eat their lunch um but d5 that's that's what's beautiful about dfi defy doesn't give a [ __ ] yeah come to our app or go to another app that's using our smart contracts it doesn't matter there can be a thousand interfaces for the same smart contracts and that's what's beautiful about it all so in terms of badgers focus we're focused on you know doing the best job at creating sustainable yield on bitcoin through our smart contracts and then empowering other platforms to integrate our smart contracts offer those services to their users and you know that was kind of the the ideation of our product interest bearing bitcoin so we have a product called ibbtc and what it is it's back one to one by bitcoin that's deposited in our yield

yield bearing vault systems right so you deposit in our vaults we our smart contracts run strategies that bitcoin in there earning interest now backs in transparent bitcoin and it's kind of like an index or a basket of different um yield bearing activities so the average of all those all those uh yield bearing activities is the yield or interest on interest bearing bitcoin so anyone that holds it is earning interest simply by holding it and we think that's probably the easiest on-ramp in the world for bringing anyone that's not into d5 into d5 because if you assume most people own bitcoin

and then the first thing they're going to want to do when thinking about d5 is to start earning on their bitcoin if you can literally just say one click you know swap or deposit or whatever you want to call it into interest bearing bitcoin and it happens in seconds now you're earning and you can redeem it at any time you you have complete control of your assets your transparency into exactly what's happening but more importantly it's just ridiculously easy it's one button you know we feel like that's how we can bring millions of people into this and and enable other platforms to offer that to their users as well to hundreds of millions of people yeah it's definitely i mean it's it's the it's the key into the system as you say and it's it brings up a level of of permissionless and kind of the nature of

what default really stands for by using that in comparison to you know block fi on other other platforms which this idea of earning yield on crypto assets is finally you know coming to light to a lot of people who are who are just holders um so it's definitely good you know to be a holder and you know if you can earn yield on that you know through badger other platforms in the smart contract world of d5 that's where you know that's where that next kind of interest um of of the entire space has been moving i mean we've been in it for a year and a half now at least so it's kind of seems like it's normal but really it's just getting off of the ground um you know i'm kind of curious what kind of four pillars andy like yeah the way i was talking to

um we're doing a revamp of our apps we're working with like the ux and ui team yesterday and we're going through like the the journey into crypto and the different buckets of people and like you know the way i look at it is you have someone that's never owned or doesn't own cryptocurrency right like that's bucket one then you have someone that buys cryptocurrency but doesn't hold their own keys so that's them going to coinbase clicking a couple buttons buying some bitcoin and ethereum that's usually them buying bitcoin or ethereum as well right then you've got the next stage of bucket three is someone that wants to take custody of their own assets and take control of their of their funds and their assets and be responsible for the security of those funds and that's like a pretty big jump for people it's a pretty big learning

curve there's a there's a lot of scary things that can happen and there's a lot of responsibility and and they're still holding right that's them holding now we're already through like the fourth bucket is someone that's holding their keys and says i wanna i wanna do something with this these assets i wanna do something with them and then that rabbit hole is where you know the whole defy ecosystem opens up and then eventually all these centralized exchanges and platforms are going to start offering those types of services so they don't use lose their users and users take their assets off their exchange um but like that's the bucket that we're playing in us and almost all other platforms it's like there's such a big audience here never mind someone that doesn't even know

about crypto and that every single day is just growing and growing and growing and now we're seeing on-ramps like nfts that are bringing people in and teaching them how to use metamask how to buy ethereum how to acquire an nft how to trade it how to sell it all this type of stuff so all these on-ramps are just going to continue to expand over time and eventually get to the point where you know more and more people fill that fourth bucket but it's important for platforms to look at like how do you attract those other buckets as well and you know that aligns closely with badgers mission because we try to make it as simple and as easy as possible right we try and say like earn on your bitcoin you know that's it you know the badger brand is a very consumer-facing brand something that

makes people feel comfortable and confident one of the reasons why the community decided to buy badger.com um and if you think about you know where we eventually go is you come to badger.com and it's one click you're earning on your bitcoin and then you're open up to this whole world of like what what can you do with it while you're earning and like what what is badger and like how do i actually have control in that but like it's just this very comfortable um familiar experience as it relates to you know other apps that they're used to or other types of brands or just uh things along those lines so that's how we see kind of the different buckets of user personas and and uh progression within the crypto industry yeah and and you mentioned nfts and kind of the positioning that badger has in

the crypto community as one for the masses not really this esoteric uh exclusive yield farm that's tough to get into but something that is very easily accessible um and open open to all um could you explore the or just kind of move us through the progression of kind of the the vision that you have for badger um over the next you know short term midterm long term um and and just essentially what's what's coming next um yeah interested in it yeah rob no don't um so you know call it what it is right our platform today and our app today is not for the masses by any stretch of the imagination right you have all these

different vaults you have to choose from you have to have already gone to a platform to get you know a certain flavor of bitcoin like go to curve and deposit an lp and bring it to badger and then there's a bunch of stuff you can do to optimize your return and you know you have to claim your rewards all the time and majority of the interest in those rewards like today um it's by no means ready for the masses but that's you know part of that's part of uh finding product market fit right like by being able to focus um on a gap in the market which was there wasn't a trusted and you know singular place within the ethereum ecosystem turn interest on your bitcoin that's already been bridged or that

you're in the process of bridging two that was our opportunity and that's um you know how we got off the ground and like any organization like it's important to get off the ground to have you know a base set of users to find an opportunity to generate revenue and to do those types of things so that's you know that's how badger started um and you know selfishly i'll suggest or biasedly i'll suggest like you know we did a a pretty good job right like we're on track of eclipsing 50 million dollars in revenue this year the treasury is very healthy which is a you know a process of different tokens that we have in there including you know hundreds of bitcoin and ethereum and badger and usdc and a

variety of other things but as we look to the future it kind of goes back rob to what i was saying right like that is our guiding star you know our north star our big picture is one click or an interest on your bitcoin in seconds right you don't need to know which chain you don't need to wrap it you don't need to do anything like we do the rest you literally come and press a button and not only in our app but you do that in apps for hundreds of platforms and integrate badger in our smart contracts because they want to offer that service to their users since their users demand that service and if they don't give it to them they're going to just go somewhere else and and go use um that service where they want us so that's

really you know our vision now how do you get there that's you know that's where the rubber meets the road right uh because we're the the industry is so mature the market and the technology infrastructure is so immature uh bridging infrastructure for example in l2s those are really just starting to uh to accelerate even different yield opportunities for bitcoin that's still relatively immature um you know the the ui and ux and how that all ties together again is is far from where it needs to be so for us it's about systematically um accomplishing some of those uh accomplishing those uh things so that we can wrap it into kind of one bundle eventually right so you know we launched

kind of as our first foot in the water like looking at the multi-chain universe we launched on binance and that was a whole initiative and and uh learning experience for us but as we come into the fall we're pretty much going to be on you know every chain where there's bitcoin um we're getting ready to launch on arbitrum polygon and optimism as well a variety of others um just going to assume that wherever there's bitcoin like badgers going to want to be with our our yield and our vault products so that systematically like once we're on those chains if you think about it that way now that when someone deposits eventually we can pick and choose like on which chain is the best yield opportunity for that user go get it and bring it back to the user and these users really need to worry about

that right um so just that you know that not to interrupt but like that that's i think an important concept is it's bridging working behind the scenes and you know you might deposit on one chain but then earn yield on another well certainly yeah of course it's going to be like that and like the smart con it's it's right now the smart contracts can't even like uh permissionlessly you know talk to the yield opportunities on those other chains right like it's a very manual process in bridging and relying on users to go bridge their first and then have those smart contracts there like you know it's far from it so for us um it's about having that infrastructure built and running

smoothly and obviously having capital there and making sure everything's rocking and rolling on those chains and then systematically it's also critical for us to get ib btc everywhere we need a ton of utility and we need a ton of liquidity and we need that liquidity on every chain to make it kind of that dominant bitcoin cross chain which again allows for anyone to go from bitcoin into it and then you know there's just a whole infrastructure on how that's earning yield so that's a big process for us uh just yesterday we put a proposal forward and a gauge vote on curve to have interest between bitcoin added on curve which we would subsequently have a vault in strategy around it to drive a lot of liquidity and um and also you know get people uh using ib btc there and then as

they look to launch gage voting and permissionless pools on all their other chains like xi and phantom and polygon and avalanche whatever you know we're going to kind of follow that same process and be able to bring ib btc to those chains with tons of liquidity and then you know the actual bridge and the bridge product and the bridging side is another big initiative right so we're getting ready to launch the ability to bridge uh bitcoin um to polygon and to phantom and then subsequently to solana and arbitrum and you know we partner with ren so as they as they expand their footprint um we expand as well and with our bridge product we always have our mint and earn functionality which makes

it you know more unique than others where you can deposit bitcoin and then start earning immediately rather than having to deposit take your tokenized bitcoin and then find a place to earn um for us it's just that one click and then you're earning so you know again we got to make sure that we can bridge to those places we got to make sure that there's vaults and yield strategies on those places we're going to make sure ib btc has deep liquidity and utility across all these places and then we eventually bring it back into you know one kind of simple click experience um you know we also have an incubator to which a protocol called zero dow is in the process of getting ready to launch and uh they've they've created a protocol that allows for um transferring bitcoin from the bitcoin network onto other chains um within a

few seconds and as we integrate that because today it takes about an hour usually um based on what type of solution you want to use but um once we get that integrated and involved in our stack again that's just another step in the beginning it's gonna be a little clunky right you're gonna have to click a bunch of buttons and blah blah but then eventually you know we bring it into this uh seamless and smooth smooth experience so uh that that's what's on deck it's all going towards that north star as i mentioned we think the opportunity is absolutely massive a multi-trillion dollar opportunity and we're going to do it the way that we do it right grassroots community led by the community for the community epic epic yeah

my biggest takeaway from you know the entire vision is the usage of ib btc as almost overtaking any other form of bitcoin collateral in d5 um and i think kind of the same thing is happening with staked eath on lego kind of a a similar concept um do you see that as you know as coming to fruition for those pairs kind of taking away the need for just having a a normal ether or a normal rap bitcoin and and just eventually d5 gets to a place where you know every form of ethan bitcoin collateral that is you know deeply liquid are the ones that are just always earning yield yeah it's just you know it's a super collateral right right i think you know i don't think it like totally dominates

um like like 99 but i do think it's it's just going to be the leading choice for people it's like you can use ether wbtc or whatever or you can use an interest bearing version if it has the same utility has the same trust parameters and the same liquidity like why wouldn't you use it right you're earning while putting it to work versus not earning and putting it to work in the same place like if you had interest bearing bitcoin sde east and wbtc on avent compound and you you uh it costs x amount to borrow and then the interest you're earning on those assets is even higher than what it even costs to borrow like why wouldn't you use the entrance brand version of

those right now of course there's a lot of work to be done around building um the not only the trust in the users but the underlying um you know security uh structure for that to ensure that it meets that appropriate standard for mass use but you know that that's what's coming right that's what's again it's all about systematically making the steps towards you know a similar goal i'm a huge fan of lido and what they've done is amazing if i'm not mistaken yesterday they announced that they have over 1 million each staked at this moment which is a massive accomplishment and i think it's it's critical that we use decentralized protocols for staking youth versus you know the centralized counterparts and and i and i

think lido is going to overtake many of the the centralized counterparts uh in the long run um for the simple fact of utility right like why would you go to an exchange and let them do it if you can do with lido and then earn another 25 by putting it to work in these three protocols exactly if it can be used as collateral and and get be like a beneficiary of the money legos that exist right now versus yeah just putting it into coinbase or or something else and i i thought they would that this would have already been created uh for usd and stable coins now indeed i remember andre and urine tried to do y usd and made a case back in 2020 about how this could be you know the stable

coin of d5 but you know i'm kind of shocked that we're still trading normal stable coins that we don't have a usdc or other you know why usd as just super deep uh with liquidity and just always be trading a form of of cash that is earning yield um you know that's still kind of a surprise to me that we're just using typical stable coins but i think as you say chris it comes down to that security and trust of users you know usdc usdt versus you know a d5 native stablecoin um that is you know in some other smart contracts right so it's kind of a uh get what you get right now in terms of security but yeah i'm still a little

bit surprised that even bitcoin might be used as collateral in terms of earning yield before we get yield bearing stable coins as super liquid in common uh in many pairs yeah and also like getting yield on those getting yield on those stable coins is you know just like on bitcoin and it's not easy right now right like there's not that many ways to consistently create yield no matter how great a smart contract you could build like the opportunities just aren't there at scale to the tune of a hundred billion dollars for example right like right now it's primarily uh built on the foundation of other protocols giving incentives and rewards away and then the market obviously

putting value on those incentives and rewards to which there's ability to generate interest by you know doing things with those rewards if your protocol earns those like that's not something that can last forever obviously not and it's because of that and the volatility in that that it makes it difficult to sustain a certain interest on an asset um like interest ban bitcoin like interest bank stable coins or ethan and but again over time that's all going to change like we're seeing the beginnings like these are all flashes these are all flashes and early indications of what's what's going to come and if you just look at the how fast this market is propelling i think we're at 150 billion now or something along those lines in d5 like that's gonna be 10 20 30 trillion dollars like

pretty darn quick and um and and it's wild like i think compound is bigger and ave is bigger than 80 or 90 percent of banks in the world something stupid like that right like like like and this is the early days and and you're doing it you know it's all permissionless software not like banks with tellers with certain regulations and certain jurisdictions with slow wire transfers and all that type of bs right none of that exists yeah and now we're building the infrastructure to handle all those all those transactions with just a piece of code um and it's all automated at the end of the day that you know we talked about the

lack of security but really as these contracts become more resilient and more battle tested like you said chris they they are more secure than somewhere where there's a potential of human error um in in a teller or a physical location or or um you know just money changing hands through different intermediaries um and i think with regards to the the stable coin environment i i was going to bring up a question why do you guys think uh ave like a tokens you know there there's certainly demand we're talking about it right now for for interest bearing stable coins um is it is it the trust is it the security kind

of why do you guys think that hasn't really taken off uh for most of the stable coin liquidity um i i think it's a little bit difficult for for uh the large majority to wrap their head around um i think someone would be yeah you'll also think like this is a small pool right like there's massive whales that are um that are the majority of the capital that's in this in the d5 system that exists today and you know as part of that uh there's different vested interests and different assets that they use and things along those lines so i think you know over time that's going to grow but today i think it's just easier for people to you know mint usdc or usdt or

use those assets and then you know put them to work and a lot of people are taking those and depositing them into um and getting ausdc back for example or or cusdc um but nonetheless the utility needs to grow in those as well right you look at you know the majority of what you could do with those assets like even lping them you know there's so much more liquidity and opportunity or an interest on lping with usdc than there is with ausdc and i think just over time that will grow but it needs to be you know concentrated effort and there needs to be a pretty big shift that happens um and i think it will eventually because like you said like we've been saying like interest bearing versions of of assets are way

better you know what i mean and i think interest bearing um assets are going to be a massive massive explosion uh andy you're on mute i'm curious what you think of the current issue in d5 which is the something for nothing problem so basically in d5 right now open for the past year and a half the only thing that you had to do to get rewards and to earn like and to earn tokens was basically just be an lp um you you know you just had to take some opportunity costs with your tokens that you were likely gonna hold anyway or obtain some tokens of of a certain type um in a pair and then stake them to earn earn yield right so what this does is it basically creates a yield locus for

example avalanche just launched their liquidity rewards over there people are just bridging over flocking over to deposit and catch some of these massive massive apys but kind of what what we're getting here is a problem where um a lot of these people who are staking aren't necessarily loyal or aren't necessarily the best um you know types of community members for protocols to thrive um so you you're almost getting like a stakeholder versus an agent or a principal versus an agent problem where you get people working for a company to try to do it well there's people that are just kind of there for the hourly wage kind of thing um so what's your thoughts on the evolution of liquidity mining as it

pertains to basically getting rid of this something for nothing um and you know even further we can go into kind of like how we could do options mining um but that's you know that that's a little deeper first i'd like to kind of hear your thoughts on this dilemma yeah i think it's around aligning incentives right like when liquidity mining first kicked off you know we got to remember there was such a low amount of liquidity and like you need assets and liquidity to really start building the foundation so it had a very strong purpose and it continues to have like we need to continue to drive liquidity um and we've seen this just with the explosion of of capital that's inside of d5 today not

only on ethereum but on other chains so um in my opinion it's been unbelievably successful in driving liquidity but also helping bootstrap the network and community right like i can speak to badger of course like we have my opinion one of the best communities in the entire space you know with with unbelievably passionate individuals with a shared value belief system and it was really only through a liquidity mining initiative that it enabled us to find these people build some type of aligned incentive between these people and have these people start contributing and as you see more and more open source protocols that are

decentralized organizations it's going to rely on passionate community members with the line incentives to make it grow and expand like sure anybody uh 10 smart people can get together and build something amazing that like ends up becoming something huge but if if you're trying to um you know distribute and and build a community of individuals that help make those decisions and help lead that effort my opinion there's been nothing better than uh liquidity mining at least in its it's it's a previous form i do think moving forward there's going to be a variety of different ways to align incentives with users and people are just going to be more mature like if you think about last summer right like you know it's funny

because like many like i was liquidy mining with wi-fi and with sushi and stuff and it's like you know the game then was like how do you sell as fast as possible while the price is like going up and going down like it's just so different right to even in today on how people leverage platforms and deposit liquidity it's very very different and that's just going to continue to grow and change as people see examples of like what could become like hey i believe in the message and the value of this sys of this protocol because i saw what wi-fi did because i saw what sushi did because i saw badger i could i now have something to tie it to which would give more confidence and

what it could become because prior to urine and wi-fi there really there wasn't examples of protocols doing a fair launch and becoming you know a one two three billion dollar market cap that never happened right this is one of the first so as we see more and more and more of that there's just going to build more confidence in people not being these locuses that just come in and there's always going to be that but i think as we introduce different types of liquidity mining initiatives options is a really cool one we actually seen quite a bit of success using options we've collaborated with uma who you may know have their kpi options for a dig product and for anybody that doesn't know digg

um dig is uh big as a synthetic rebasing bitcoin and um you know with rebasing assets it's it's important that there's more positive rebates and there's negative rebases of course um to help drive the market cap and help it grow so we did an options program over the last three or four months and this month being the most successful where for every positive rebates our options pay out rewards so it encourages an alignment lines incentives for people to buy and hold and to ensure that it gets into a positive rebate because there's a reward and incentive associated with it right

so that's um that's an example of how we're using and i think more people are going to do that moving forward yep the mine the options mining is is is epic it it's going to be tough to get um a lot of users who are used to just getting yield rewards instantly rather than having to kind of take a bit more risk um because effectively getting in in the example that i'm speaking of it's basically instead of earning straight yield so let's say an example of curve what what what you what you do is you actually earn a a um a call option in this case on the asset that you're farming and so basically uh rather than just getting the asset you

get this call auction with call options a certain strike price um which kind of helps to protect the protocol from the farm and dump because of the of the longevity of these as well as yeah the aligned incentives when it comes to everybody who's who is farming with these with these options i mean that compare combined with all sorts of vestings and and lockups can certainly help um you know but in the example of of the badger token right during during the end of d5 winter there was a strong decline um in price which led to a lot of depressed incentives um for you know for the protocol a lot of the apys on the protocol went down interest in d5 you know kind of went down and and there

was you know there was just like a a lack of uh of a of a narrative um now you guys have clearly bounced back from that um but you know i'm curious what was going on in that time when the token was just going down like what was the team's kind of morale and what was the way out of like a lower a lower uh apy lack of interest you know what was what was the push forward that you know if a d5 protocol is listening you know a community member who who can advise a potential protocol who's in a similar spot you know what did you guys do to kind of get out of that well um first and foremost it was double down on you know what made us even get to that

place in the first get there in the first place which is the community right um together with the community we looked at and decided like different types of things to build and iterations to make to garner more interest but more importantly to give utility to the existing community which in turn would be you know the greater community moving forward and this is where a lot of our ideas like boosts and things came out of so we often you know it's hard not to but you know it's very difficult to look at the price and you know make decisions as it relates to the price movement because so much of it if not all of it's out of your control so we just double down on building focused on you know our our north star our guiding light and making that

progression there and being confident in that vision and then with the community support and then backing us and helping and then together collectively making these decisions you know it's enabled us to kind of get through some of those times because these people um that are part of the community you know they care about accomplishing the vision as much as the people that are building the tech are on our team care about it so if that doesn't waver and you and you build a community of people with a shared value and belief system really any time up or down um you can get through yeah yeah yeah i mean the badger community has has never been stronger and those times is kind of what makes the community the community um you know

there's kind of the meme community members but that's really what it is is is you know holding through those and working and building and help helping the community is you know that's what it is all about um yeah that's awesome that's awesome excited to have been you know in the in the early days of badger and participating in that and you know i've seen it on my own you know stack just seeing how the potential of earning yield on bitcoin is is just i mean it makes you never want to sell you know it really lowers the cell pressure of bitcoin and especially when you're holding it in d5 and earning the yield and you know it's just like boom yeah well guys i i just want to be conscious of time because i have a call in a few

minutes here so i just want to you know make sure i respect your guys's time as well but um would you guys anything else you guys wanted to dig into and rap about this is a jam chris not this was great um something that really hit home i think was the the concentration on community at the same time being cognizant that maximalism is detrimental to the entire system um you know we we all are part of these individual communities but extremism is always gonna uh you know throw us off the deep end so um and that goes you know for for any communities and um just general principles in the space so thanks chris

for coming on this was great and uh yeah looking forward to all all that badger has to offer over the next you know coming months and years yeah guys i really appreciate you having me on here and chad and this is i i get fired up talking about all this stuff so uh thanks for having me and and messaging me hell yeah man i appreciate you being super open with your responses and being uh here to to talk and representing the community uh as well as explaining to our community you know how they can get some yield on bitcoin i'm sure there's a bunch of people after this uh after they listen just to the first 15 minutes of this um you know we'll be instantly looking into badger getting their getting their their bitcoin onto ethereum and um yeah man thanks a lot

and have a great one awesome guys