Jul 5, 2024
Jul 5, 2024
Jul 5, 2024
From HODL to Yield: How Velar is Transforming Bitcoin Investments
From HODL to Yield: How Velar is Transforming Bitcoin Investments
From HODL to Yield: How Velar is Transforming Bitcoin Investments
Introduction
Ever since its inception, Bitcoin's narrative has centered around its potential as a speculative store of value and hedge against inflation. The predominant investment strategy that emerged was to simply buy and "HODL" BTC, keeping it locked away in wallets while hoping for lofty returns in the long run.
However, this is tremendously inefficient when Bitcoin's possibilities in decentralized finance (DeFi) are considered. Protocols like Velar are now unlocking Bitcoin's potential for sophisticated DeFi, allowing BTC holders to do more than passively hold.
The Evolution of Bitcoin Investing
Early Days
In the early years since Bitcoin's launch in 2009, cryptocurrency markets were dominated by retail investors who rode various boom and bust cycles.
Investing in Bitcoin simply meant buying it as a speculative bet on its eventual mass adoption as digital gold. The "HODL" meme emerged as the philosophy for Bitcoin investing - buy it today and hold onto it into the indefinite future.
This made sense in Bitcoin's nascent stage when its infrastructure was still being built. However, it also meant Bitcoin holders kept their assets locked away rather than putting it to productive use and generating supplemental yield.
The Rise of DeFi on Ethereum
In parallel, the decentralized finance (DeFi) movement was quickly gaining traction on Ethereum starting 2016.
By locking funds into DeFi protocols like lending platforms, exchanges, and yield farms, Ethereum users could passively earn interest, leverage trade, provide liquidity for fees, and more.
This demonstrated to the wider crypto markets that there was more one could do with digital assets rather than just holding them. DeFi proved crypto could be productive capital rather than being confined to speculative value appreciation.
However, Ethereum DeFi in its breakout state also came with its share of weaknesses - platform risks from new code, excessive collateral requirements, regulation uncertainty, and security vulnerabilities that led to exploits draining user funds.
Critics were quick to point out that while DeFi innovation was growing at a breakneck pace, it was coming at the cost of credible neutrality and real-world applicability.
Velar - Unlocking Bitcoin for DeFi
This is where Bitcoin-focused DeFi projects have begun gaining more traction by addressing DeFi's shortcomings.
Rather than sacrifice decentralization or security in the pursuit of complexity, Bitcoin-DeFi protocols double down on leveraging Bitcoin's reliability as their foundation.
Velar taps into this potential through an architecture that fuses -
Bitcoin's security from its decade-long track record of protecting value.
The programmability and expressiveness of Layer 2 solutions built on top of Bitcoin's robust blockchain foundation.
This opens up the capability to build self-custodial financial use cases that allow Bitcoin holders to harness DeFi's benefits directly using BTC and compatible assets.
Velar's vision has identified that delivering sophisticated DeFi experiences doesn't mean compromising on Bitcoin's decentralization or censorship-resistance. It's about identifying complementing components that augment it - like using predictable and formally verified smart contracts, maintaining Proof-of-Work security, and ensuring sovereignty rests with users.
The result is an ecosystem that combines Bitcoin's credibility with the generative nature of decentralized finance - truly getting the best out of both.
Core Products Bringing Yield to Bitcoin
Velar aims to turn Bitcoin from speculative holding into active digital capital that can be deployed across DeFi use cases to enhance returns beyond just relying on lofty future price appreciation alone.
Some of its upcoming marquee offerings enabling this include:
Perpetual DEX - This decentralized trading platform built on Bitcoin will offer up to 20x leverage for speculating on BTC's price movements without needing trusted intermediaries or centralized exchanges. Bitcoin holders can adopt both long and short positions to hedge risk and seek deltas across bull and bear scenarios.
Liquidity Pools – Velar will facilitate pooled lending markets allowing Bitcoin and other crypto holders to provide their assets in order to earn swap fees and platform token rewards. With market depth, annual percentage yields from supplying to automated market maker pools are expected to be highly attractive.
Fiat On-Ramps – Velar also plans to provide seamless fiat-to-crypto integrations by leveraging partnerships with payment gateways globally. This will let users directly purchase Bitcoin using local currency and deploy it across Velar's DeFi suite for efficient yield opportunities, rather than having capital sit idle.
Bringing these capabilities together, Velar unlocks the permissionless financial utility of Bitcoin - without diluting the decentralized qualities that give Bitcoin its appeal in the first place.
Use Cases Enabling Bitcoin as Capital
To understand how Velar's DeFi suite concretely enables Bitcoin holders to transform from passive holders to active capital allocators, let's walk through some examples.
Ram is a long-term Bitcoin investor who purchased 10 BTC at an average price under $10,000 over the last few years. Instead of obsessively tracking prices daily and waiting indefinitely for the next bull run, he decides to stake 3 BTC into Velar's BTC/USD AMM liquidity pool.
In return for providing the pool with capital to fund traders' leverage positions, he earns, let’s say, up to 12% APY on his BTC. So his $100,000 Bitcoin investment now generates $12,000 per year in supplemental yield by deploying his assets across this yield opportunity.
Shyam has been hesitant about crypto investing given past volatility. But he conservatively decides to buy 0.5 BTC to test the waters and builds up his understanding over time. Rather than leaving the Bitcoin holding idle on an exchange wallet, he provides it as liquidity on Velar to earn automated trading fees from the protocol.
This brings in up to 7.5% annually off his investment as rewards while still getting exposure to Bitcoin's long-term upside. If his conviction in Bitcoin keeps strengthening, he can choose to increase his position to amplify yields accordingly in a risk-adjusted manner.
By embracing Bitcoin-native DeFi, Velar is transforming the narrative around Bitcoin from one of speculative "HODLing" alone to one of generative digital capital - capital that can be deployed across yield-bearing opportunities with the safety of Bitcoin's assurances.
The path to financial freedom is no longer fully binary based on relying solely on lofty future Bitcoin price targets coming to fruition years out. Thanks to solutions like Velar, Bitcoin holders can unlock forms of passive income and productivity today that are native to this asset class.
As Bitcoin-based DeFi continues proliferating in maturity and sophistication, expect more investors to jump in and shift their mental models around BTC from inactive holding assets to generative working capital. The future looks bright for Bitcoin finally finding relevance beyond mere speculation - by powering a new generation of decentralized financial utilities with the security of the world's dominant cryptocurrency.
Conclusion
Velar represents the next evolution of participative finance - one that taps into the multidimensional possibilities of Bitcoin as the bedrock asset class of web3.
It unlocks new opportunities for Bitcoin holders to do more than just speculate on lofty future price potential and actually utilize BTC across decentralized financial utilities today - from leverage to yield and beyond.
By combining Bitcoin's enduring qualities with sophisticated DeFi, Velar is leading the shift from "HODLing" to unlocking Bitcoin's fuller potential as deployed capital in a user-controlled ecosystem.
DeFi experiences no longer need to come at the cost of trust assurances and technical decentralization. And Bitcoin no longer needs to confine itself to just being "digital gold" alone either. The gap between speculation and sophisticated financial utility is closing.
As this happens, expect more and more Bitcoin believers to migrate from a mindset of inactive holding bitcoin for far-off potential, to active utilization of BTC across DeFi protocols like Velar to unearth that future's possibilities years in advance.
The next generation of Bitcoin's evolution is here - will you tap into it?
Introduction
Ever since its inception, Bitcoin's narrative has centered around its potential as a speculative store of value and hedge against inflation. The predominant investment strategy that emerged was to simply buy and "HODL" BTC, keeping it locked away in wallets while hoping for lofty returns in the long run.
However, this is tremendously inefficient when Bitcoin's possibilities in decentralized finance (DeFi) are considered. Protocols like Velar are now unlocking Bitcoin's potential for sophisticated DeFi, allowing BTC holders to do more than passively hold.
The Evolution of Bitcoin Investing
Early Days
In the early years since Bitcoin's launch in 2009, cryptocurrency markets were dominated by retail investors who rode various boom and bust cycles.
Investing in Bitcoin simply meant buying it as a speculative bet on its eventual mass adoption as digital gold. The "HODL" meme emerged as the philosophy for Bitcoin investing - buy it today and hold onto it into the indefinite future.
This made sense in Bitcoin's nascent stage when its infrastructure was still being built. However, it also meant Bitcoin holders kept their assets locked away rather than putting it to productive use and generating supplemental yield.
The Rise of DeFi on Ethereum
In parallel, the decentralized finance (DeFi) movement was quickly gaining traction on Ethereum starting 2016.
By locking funds into DeFi protocols like lending platforms, exchanges, and yield farms, Ethereum users could passively earn interest, leverage trade, provide liquidity for fees, and more.
This demonstrated to the wider crypto markets that there was more one could do with digital assets rather than just holding them. DeFi proved crypto could be productive capital rather than being confined to speculative value appreciation.
However, Ethereum DeFi in its breakout state also came with its share of weaknesses - platform risks from new code, excessive collateral requirements, regulation uncertainty, and security vulnerabilities that led to exploits draining user funds.
Critics were quick to point out that while DeFi innovation was growing at a breakneck pace, it was coming at the cost of credible neutrality and real-world applicability.
Velar - Unlocking Bitcoin for DeFi
This is where Bitcoin-focused DeFi projects have begun gaining more traction by addressing DeFi's shortcomings.
Rather than sacrifice decentralization or security in the pursuit of complexity, Bitcoin-DeFi protocols double down on leveraging Bitcoin's reliability as their foundation.
Velar taps into this potential through an architecture that fuses -
Bitcoin's security from its decade-long track record of protecting value.
The programmability and expressiveness of Layer 2 solutions built on top of Bitcoin's robust blockchain foundation.
This opens up the capability to build self-custodial financial use cases that allow Bitcoin holders to harness DeFi's benefits directly using BTC and compatible assets.
Velar's vision has identified that delivering sophisticated DeFi experiences doesn't mean compromising on Bitcoin's decentralization or censorship-resistance. It's about identifying complementing components that augment it - like using predictable and formally verified smart contracts, maintaining Proof-of-Work security, and ensuring sovereignty rests with users.
The result is an ecosystem that combines Bitcoin's credibility with the generative nature of decentralized finance - truly getting the best out of both.
Core Products Bringing Yield to Bitcoin
Velar aims to turn Bitcoin from speculative holding into active digital capital that can be deployed across DeFi use cases to enhance returns beyond just relying on lofty future price appreciation alone.
Some of its upcoming marquee offerings enabling this include:
Perpetual DEX - This decentralized trading platform built on Bitcoin will offer up to 20x leverage for speculating on BTC's price movements without needing trusted intermediaries or centralized exchanges. Bitcoin holders can adopt both long and short positions to hedge risk and seek deltas across bull and bear scenarios.
Liquidity Pools – Velar will facilitate pooled lending markets allowing Bitcoin and other crypto holders to provide their assets in order to earn swap fees and platform token rewards. With market depth, annual percentage yields from supplying to automated market maker pools are expected to be highly attractive.
Fiat On-Ramps – Velar also plans to provide seamless fiat-to-crypto integrations by leveraging partnerships with payment gateways globally. This will let users directly purchase Bitcoin using local currency and deploy it across Velar's DeFi suite for efficient yield opportunities, rather than having capital sit idle.
Bringing these capabilities together, Velar unlocks the permissionless financial utility of Bitcoin - without diluting the decentralized qualities that give Bitcoin its appeal in the first place.
Use Cases Enabling Bitcoin as Capital
To understand how Velar's DeFi suite concretely enables Bitcoin holders to transform from passive holders to active capital allocators, let's walk through some examples.
Ram is a long-term Bitcoin investor who purchased 10 BTC at an average price under $10,000 over the last few years. Instead of obsessively tracking prices daily and waiting indefinitely for the next bull run, he decides to stake 3 BTC into Velar's BTC/USD AMM liquidity pool.
In return for providing the pool with capital to fund traders' leverage positions, he earns, let’s say, up to 12% APY on his BTC. So his $100,000 Bitcoin investment now generates $12,000 per year in supplemental yield by deploying his assets across this yield opportunity.
Shyam has been hesitant about crypto investing given past volatility. But he conservatively decides to buy 0.5 BTC to test the waters and builds up his understanding over time. Rather than leaving the Bitcoin holding idle on an exchange wallet, he provides it as liquidity on Velar to earn automated trading fees from the protocol.
This brings in up to 7.5% annually off his investment as rewards while still getting exposure to Bitcoin's long-term upside. If his conviction in Bitcoin keeps strengthening, he can choose to increase his position to amplify yields accordingly in a risk-adjusted manner.
By embracing Bitcoin-native DeFi, Velar is transforming the narrative around Bitcoin from one of speculative "HODLing" alone to one of generative digital capital - capital that can be deployed across yield-bearing opportunities with the safety of Bitcoin's assurances.
The path to financial freedom is no longer fully binary based on relying solely on lofty future Bitcoin price targets coming to fruition years out. Thanks to solutions like Velar, Bitcoin holders can unlock forms of passive income and productivity today that are native to this asset class.
As Bitcoin-based DeFi continues proliferating in maturity and sophistication, expect more investors to jump in and shift their mental models around BTC from inactive holding assets to generative working capital. The future looks bright for Bitcoin finally finding relevance beyond mere speculation - by powering a new generation of decentralized financial utilities with the security of the world's dominant cryptocurrency.
Conclusion
Velar represents the next evolution of participative finance - one that taps into the multidimensional possibilities of Bitcoin as the bedrock asset class of web3.
It unlocks new opportunities for Bitcoin holders to do more than just speculate on lofty future price potential and actually utilize BTC across decentralized financial utilities today - from leverage to yield and beyond.
By combining Bitcoin's enduring qualities with sophisticated DeFi, Velar is leading the shift from "HODLing" to unlocking Bitcoin's fuller potential as deployed capital in a user-controlled ecosystem.
DeFi experiences no longer need to come at the cost of trust assurances and technical decentralization. And Bitcoin no longer needs to confine itself to just being "digital gold" alone either. The gap between speculation and sophisticated financial utility is closing.
As this happens, expect more and more Bitcoin believers to migrate from a mindset of inactive holding bitcoin for far-off potential, to active utilization of BTC across DeFi protocols like Velar to unearth that future's possibilities years in advance.
The next generation of Bitcoin's evolution is here - will you tap into it?
Introduction
Ever since its inception, Bitcoin's narrative has centered around its potential as a speculative store of value and hedge against inflation. The predominant investment strategy that emerged was to simply buy and "HODL" BTC, keeping it locked away in wallets while hoping for lofty returns in the long run.
However, this is tremendously inefficient when Bitcoin's possibilities in decentralized finance (DeFi) are considered. Protocols like Velar are now unlocking Bitcoin's potential for sophisticated DeFi, allowing BTC holders to do more than passively hold.
The Evolution of Bitcoin Investing
Early Days
In the early years since Bitcoin's launch in 2009, cryptocurrency markets were dominated by retail investors who rode various boom and bust cycles.
Investing in Bitcoin simply meant buying it as a speculative bet on its eventual mass adoption as digital gold. The "HODL" meme emerged as the philosophy for Bitcoin investing - buy it today and hold onto it into the indefinite future.
This made sense in Bitcoin's nascent stage when its infrastructure was still being built. However, it also meant Bitcoin holders kept their assets locked away rather than putting it to productive use and generating supplemental yield.
The Rise of DeFi on Ethereum
In parallel, the decentralized finance (DeFi) movement was quickly gaining traction on Ethereum starting 2016.
By locking funds into DeFi protocols like lending platforms, exchanges, and yield farms, Ethereum users could passively earn interest, leverage trade, provide liquidity for fees, and more.
This demonstrated to the wider crypto markets that there was more one could do with digital assets rather than just holding them. DeFi proved crypto could be productive capital rather than being confined to speculative value appreciation.
However, Ethereum DeFi in its breakout state also came with its share of weaknesses - platform risks from new code, excessive collateral requirements, regulation uncertainty, and security vulnerabilities that led to exploits draining user funds.
Critics were quick to point out that while DeFi innovation was growing at a breakneck pace, it was coming at the cost of credible neutrality and real-world applicability.
Velar - Unlocking Bitcoin for DeFi
This is where Bitcoin-focused DeFi projects have begun gaining more traction by addressing DeFi's shortcomings.
Rather than sacrifice decentralization or security in the pursuit of complexity, Bitcoin-DeFi protocols double down on leveraging Bitcoin's reliability as their foundation.
Velar taps into this potential through an architecture that fuses -
Bitcoin's security from its decade-long track record of protecting value.
The programmability and expressiveness of Layer 2 solutions built on top of Bitcoin's robust blockchain foundation.
This opens up the capability to build self-custodial financial use cases that allow Bitcoin holders to harness DeFi's benefits directly using BTC and compatible assets.
Velar's vision has identified that delivering sophisticated DeFi experiences doesn't mean compromising on Bitcoin's decentralization or censorship-resistance. It's about identifying complementing components that augment it - like using predictable and formally verified smart contracts, maintaining Proof-of-Work security, and ensuring sovereignty rests with users.
The result is an ecosystem that combines Bitcoin's credibility with the generative nature of decentralized finance - truly getting the best out of both.
Core Products Bringing Yield to Bitcoin
Velar aims to turn Bitcoin from speculative holding into active digital capital that can be deployed across DeFi use cases to enhance returns beyond just relying on lofty future price appreciation alone.
Some of its upcoming marquee offerings enabling this include:
Perpetual DEX - This decentralized trading platform built on Bitcoin will offer up to 20x leverage for speculating on BTC's price movements without needing trusted intermediaries or centralized exchanges. Bitcoin holders can adopt both long and short positions to hedge risk and seek deltas across bull and bear scenarios.
Liquidity Pools – Velar will facilitate pooled lending markets allowing Bitcoin and other crypto holders to provide their assets in order to earn swap fees and platform token rewards. With market depth, annual percentage yields from supplying to automated market maker pools are expected to be highly attractive.
Fiat On-Ramps – Velar also plans to provide seamless fiat-to-crypto integrations by leveraging partnerships with payment gateways globally. This will let users directly purchase Bitcoin using local currency and deploy it across Velar's DeFi suite for efficient yield opportunities, rather than having capital sit idle.
Bringing these capabilities together, Velar unlocks the permissionless financial utility of Bitcoin - without diluting the decentralized qualities that give Bitcoin its appeal in the first place.
Use Cases Enabling Bitcoin as Capital
To understand how Velar's DeFi suite concretely enables Bitcoin holders to transform from passive holders to active capital allocators, let's walk through some examples.
Ram is a long-term Bitcoin investor who purchased 10 BTC at an average price under $10,000 over the last few years. Instead of obsessively tracking prices daily and waiting indefinitely for the next bull run, he decides to stake 3 BTC into Velar's BTC/USD AMM liquidity pool.
In return for providing the pool with capital to fund traders' leverage positions, he earns, let’s say, up to 12% APY on his BTC. So his $100,000 Bitcoin investment now generates $12,000 per year in supplemental yield by deploying his assets across this yield opportunity.
Shyam has been hesitant about crypto investing given past volatility. But he conservatively decides to buy 0.5 BTC to test the waters and builds up his understanding over time. Rather than leaving the Bitcoin holding idle on an exchange wallet, he provides it as liquidity on Velar to earn automated trading fees from the protocol.
This brings in up to 7.5% annually off his investment as rewards while still getting exposure to Bitcoin's long-term upside. If his conviction in Bitcoin keeps strengthening, he can choose to increase his position to amplify yields accordingly in a risk-adjusted manner.
By embracing Bitcoin-native DeFi, Velar is transforming the narrative around Bitcoin from one of speculative "HODLing" alone to one of generative digital capital - capital that can be deployed across yield-bearing opportunities with the safety of Bitcoin's assurances.
The path to financial freedom is no longer fully binary based on relying solely on lofty future Bitcoin price targets coming to fruition years out. Thanks to solutions like Velar, Bitcoin holders can unlock forms of passive income and productivity today that are native to this asset class.
As Bitcoin-based DeFi continues proliferating in maturity and sophistication, expect more investors to jump in and shift their mental models around BTC from inactive holding assets to generative working capital. The future looks bright for Bitcoin finally finding relevance beyond mere speculation - by powering a new generation of decentralized financial utilities with the security of the world's dominant cryptocurrency.
Conclusion
Velar represents the next evolution of participative finance - one that taps into the multidimensional possibilities of Bitcoin as the bedrock asset class of web3.
It unlocks new opportunities for Bitcoin holders to do more than just speculate on lofty future price potential and actually utilize BTC across decentralized financial utilities today - from leverage to yield and beyond.
By combining Bitcoin's enduring qualities with sophisticated DeFi, Velar is leading the shift from "HODLing" to unlocking Bitcoin's fuller potential as deployed capital in a user-controlled ecosystem.
DeFi experiences no longer need to come at the cost of trust assurances and technical decentralization. And Bitcoin no longer needs to confine itself to just being "digital gold" alone either. The gap between speculation and sophisticated financial utility is closing.
As this happens, expect more and more Bitcoin believers to migrate from a mindset of inactive holding bitcoin for far-off potential, to active utilization of BTC across DeFi protocols like Velar to unearth that future's possibilities years in advance.
The next generation of Bitcoin's evolution is here - will you tap into it?
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Stay ahead of the curve
Subscribe to our newsletter Bitcoin Bytes for timely insights, razor-sharp analysis, and real alpha about the rapidly evolving Bitcoin ecosystem.
No spam, only alpha!
A unique window of opportunity
A unique window of opportunity
In this analysis, we'll examine why common narratives about MSTR fall short, explore the true nature of their strategy
In this analysis, we'll examine why common narratives about MSTR fall short, explore the true nature of their strategy
This isn't just another wrapped Bitcoin solution – it's a revolutionary technology
This isn't just another wrapped Bitcoin solution – it's a revolutionary technology
A unique window of opportunity
In this analysis, we'll examine why common narratives about MSTR fall short, explore the true nature of their strategy