What is Lombard Finance?
Lombard Finance is a financial tool that enables LBTC, a yield-bearing BTC, to move cross-chain without fragmenting liquidity. LBTC is Bitcoin backed 1:1 bringing DeFi interoperability to Bitcoin, the digital gold of the industry. Lombard allows users to hold Bitcoin as a store of value and simultaneously earn, stake, trade, and engage with DeFi.Â
What is LBTC?
LBTC is the yield-bearing, cross-chain compatible asset, fully backed by BTC. This design ensures the price of LBTC value remains directly tied to Bitcoin. This backing is fortified by the Security Consortium, a coalition of Bitcoin-aligned ecosystem players committed to enhancing the security and liquidity of LBTC.
LBTC holders earn native yield through Babylon staking. Babylon is a shared security protocol that uses Bitcoin to secure the Proof-of-Stake economy. This innovation enables new yield-bearing liquid primitives like LBTC to be built on top of it. LBTC benefits from the collective security provided by a network of consortium ecosystems as the structure offers greater security than centralized wrapped tokens and unsecured bridges, reducing risks associated with cross-chain transactions. To encourage use, early participants receive Lombard Points, providing additional rewards and incentives. LBTC is designed to be natively minted across major blockchain ecosystems, and eventually will be used as collateral in various lending and borrowing protocols. It is also compatible with decentralized exchanges (perp DEXs) and other DeFi applications. Â
What are the Benefits for LBTC Holders?
People can earn yield in different ways such as Babylon staking yield, Lombard points, and incentives from LBTC destination chains and protocols. Users can also engage in strategies like lending LBTC or borrowing against it, executing yield trading strategies, and committing LBTC to automated yield-generating vaults, all while holding Bitcoin as a store of value as it was designed to be.
How Does RedStone Support LBTC and Lombard Finance?
Oracles are responsible for providing data feeds such as prices to decentralized applications (dApps). These dApps vary from derivatives protocols to stablecoin protocols. RedStone provides a value for the LBTC token, representing the active number of bitcoins that has been locked in Babylon by Lombard. Ensuring an accurate feed from RedStone of the amount of bitcoin locked ensures that the amount of LTBC issued is in fact 1:1 to the amount of BTC locked-up being held in reserve.
About RedStone
RedStone is a Modular Oracle specializing in yield-bearing collateral for lending markets, especially LSTs & LRTs. It offers gas-optimized data feeds across 50+ chains and all rollups. Trusted by Morpho, Venus, ether.fi & more.
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