Many attempts to create bridges between Bitcoin and other blockchains are centralized. BadgerDao aims to build truly decentralized products and infrastructure that will seamlessly integrate Bitcoin with DeFi.
In many ways, Bitcoin has forever changed our perception of money. Before the creation of the world’s first cryptocurrency, we all were limited by the constraints of centralized financial markets. These constraints include systemic inefficiencies in transferring money across borders and high fees.
Bitcoin’s blockchain did not have much of the framework that DeFi relies on. Holders of BTC thus found it hard to participate in DeFi activities like lending, staking etc. This is in spite of the fact that other blockchains like Ethereum have tried to create a pathway, through the wrapping technique, for BTC to be used for DeFi in those blockchains.
The main issue with the existing BTC bridges to other blockchains is that many of them act like centralized agents. To use them, you have to give up your BTC to them. You must trust them enough to keep your BTC in good custody whilst giving you an equivalent for use on other blockchains. DeFi, by its very nature, is built around trustlessness. BadgerDao offers a trustless, secure, and easy-to-use bridge connecting the Bitcoin blockchain and others for an easy flow of BTC into DeFi.
DAO In Brief
A Decentralised Autonomous Organisation (DAO) is an institutional framework that is not controlled by a single authorizing unit. A single entity does not hold the right to make and implement decisions. Instead, that right is jointly owned by a community of entities with an interest in the growth and success of the organization. The community is not bound by any legal contract, but the main incentive is the organization’s native tokens issued as rewards to participants. Some advantages of DAO are much lower management costs and faster decision-making. DAOs are of useful application in decentralized finance. They take the place of centralized authorities of CeFi that have no place in true DeFi.
What Is Badger DAO?
Badger DAO is an open-source DAO that aims to fast-track the integration of Bitcoin into DeFi. To do this, Badger will develop a suite of products by providing a community-driven platform where developers and users can collaborate. The BadgerDao mainnet was launched in December 2020. The idea behind the project is to pool together a community to see Bitcoin fully functional in the DeFi space. This community will then govern the operation of Badger DAO, including the development of and the dynamics of Badger’s products.
Features Of Badger DAO
Badger has some features that characterize it. These include,
This is a segment of the community that collaborates to build new products. They are mainly developers. They are a very critical unit in the Badger ecosystem because the present and future utility of Badger so much rests on their shoulders.
2. Products Are Created By The Community
Any member of the community can come up with an idea for a new product. If the rest of the community welcomes the idea, the Builders take it up for further collaboration and development. The platform’s Discord and Telegram channels are usually used for voting on proposals.
3. The code for the project is fully open-source.
The codes can be accessed via the project’s GitHub repository.
4. Fair Distribution of Initial Governance Tokens
The community firmly controls BadgerDao’s governance token. The project’s tokens were launched fairly and provably such that no single entity had ownership of a significant amount of tokens to control the economics.
Core Products of BadgerDao
Badger has two major products: SETT and DIGG. Let us look at them briefly.
It is an automated DeFi aggregator. SETT has modeled after Yearn.finance’s vaults but makes use of tokenized Bitcoin only. Smart contracts run the vaults. These smart contracts are designed to deploy their assets across several DeFi yielding protocols in an automated manner. Hence, users who deposit tokenized bitcoin into the SETT vaults earn returns with hardly any effort from them; the smart contract does all the work. Here is a guide on how to use SETT vaults on the Binance Smart Chain.
This is a cryptocurrency whose value is pegged to that of Bitcoin. DIGG has an elastic supply: its circulating volume either expands or contracts to depend on the direction of Bitcoin’s price movement.
The core idea behind DIGG is to create a non-custodial platform for users to make use of synthetic Bitcoin. This effectively does away with centralized third parties. More on DIGG can be found here.
Source : bsc.news
Founded in 2020, BSCNews is the leading media platform covering decentralized finance (DeFi) on the Binance Smart Chain (BSC). We cover a wide range of blockchain news revolving mainly around the DeFi sector of the crypto markets. BSCNews aims to inform, educate and share information with the global investment community through our website, social media, newsletters, podcasts, research, and live ask me anything (AMA). Our content reaches hundreds of thousands of global investors who are active in the BSC DeFi space.