BTVM Exchange
Introduction
At BitEVM's mainnet launch, users will be able to redeem $BTVM to earn protocol revenue. In addition, they can (optional) choose to supply it as liquidity across native integrations to boost rewards further. This will exclude pairs where the basis trade is run, removing reflexivity risks.
$BTVM redemption will likely represent the majority of all onchain orderbook liquidity, with users being able to redeem their BTVM token to receive USDT seamlessly native integrations to be used as collateral for building orderbooks.
This creates composable liquidity that will bridge the gap between that of centralized exchanges and decentralized exchanges, while adding the ability for users to capture additional yields outside those natively generated by the synthetic dollar itself.
How It Works
BitEVM nodes, which validate BitEVM L2, receive their rewards in BitEVM tokens upfront. These rewards are subject to a vesting schedule, but the liquidity is available immediately for use on BitEVM Redemption. This system is designed to handle significant trade volumes efficiently. Here's a detailed explanation of the process:
Utilizing BitEVM Key Node Owned:
In this scenario, the BitEVM Node will utilize the BitEVM tokens owned by Key Holders.
These tokens are posted as collateral in a strongly overcollateralized position within the BitEVM lending pool.
BitEVM Key Node borrows BTVM tokens using the posted BTVM tokens as collateral.
Execution and Settlement:
The transaction request is verified on the blockchain to ensure the user has the requisite amount of $BTVM tokens and that all conditions are met.
Subsequently, the BitEVM Key Node hedges the order, rebalances its portfolio, and repays the redemption that you just exchanged.
This entire process is carried out while maintaining a delta-neutral position for BitEVM Key Nodes.
Benefits
Instant Liquidity:
BitEVM node delegators provide BTVM tokens that are otherwise idle, enabling immediate liquidity for large trades.
This ensures immediate liquidity for $BTVM holders, allowing them to convert their tokens into a stable asset like USDT, with 1:1 CEX pricing.
Real Yield for BitEVM Key Holders:
By leveraging BTVM token Liquidity, BitEVM Key Holders generate real yield.
This adds a significant value proposition for delegators who redeem $BTVM tokens with BitEVM Key Nodes.
Increased Capital Efficiency:
Using Key node rewards liquidity to facilitate trades takes validator node capital efficiency to unprecedented heights.
Conclusion
BitEVM Redemption is a sophisticated mechanism that enhances the liquidity, efficiency, and security of the BitEVM ecosystem. By leveraging the immediate availability of BitEVM tokens from BitEVM Key nodes, BitEVM can facilitate large trades seamlessly, providing real yield to Key Holders and boosting the platform's TVL. This innovative approach underscores the strategic advantage of BitEVM Key Holders within the BitEVM network and their critical role in driving the ecosystem's growth and stability.
Last updated