Bitcoin-based stablecoin USDh achieves significant liquidity milestone with $3 million support, paving the way for higher yields and further development in Bitcoin’s DeFi sector.
Bitcoin-Based Stablecoin USDh Secures $3M in Liquidity
USDh developers Hermetica have completed a deal to bring around $3 million in liquidity to the token.
Collaboration with Zest Brings New Opportunities
Hermetica, a stablecoin built on Bitcoin layer 2 Stacks, has secured this liquidity through collaboration with Bitcoin lending protocol Zest. The two plan to offer yield on USDh through lending against sBTC, the bitcoin-backed bridging asset that users can use to put their bitcoin wealth in the Stacks ecosystem.
Potential for Higher Yields
The initial liquidity boost could create a short-term window of higher yields, Hermetica said, with projections of an annual percentage yield (APY) as high as 50%. Currently, USDh provides an average APY of 18%.
Role of Stablecoins in the Crypto Economy
Stablecoins play an integral role in the crypto economy, giving users a means of holding their assets in a token that isn’t prone to significant ebbs and flows in value. This is because they are pegged to a fiat currency (usually the U.S. dollar).
Significance for Bitcoin‘s Evolution
Provision for stablecoins would naturally be an important development in Bitcoin’s evolution into a network that can support DeFi capabilities, a trend that has gathered momentum in the last couple of years.
Comparison to Dominant Stablecoins
However, it is worth noting that the $3 million in liquidity provided by USDh is tiny compared to the dominant stablecoins in crypto. USDT and USDC have market caps of over $138 billion and $51 billion respectively, highlighting the relative infancy of the Bitcoin DeFi sector.
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- coindesk.com | Bitcoin Based Stablecoin USDh Secures $3M in Liquidity
- yahoo.com | Bitcoin Based Stablecoin USDh Secures $3M in Liquidity
