In order to help bitcoin (BTC) owners deploy their assets on-chain and earn income, the bitcoin lending protocol Zest has raised $3.5 million. Rich investor Tim Draper spearheaded the seed round, with support from Trust Machines, Flow Traders, Binance Labs, and other investors, Zest Protocol revealed via email on Monday. The Nakamoto update by Bitcoin layer 2 Stacks and bridge asset sBTC (pegged 1:1 to bitcoin) are utilized by Zest Protocol to fully natively construct a lending experience on the biggest blockchain network in the world.
Users on Zest Protocol, which operates on the Stacks mainnet, will be able to participate in lending and other yield-generating activities after relying on sBTC to transmit bitcoin to fill their balance.
“Bitcoin L2s like Stacks are set to play a key role in unlocking Bitcoin DeFi,” said Tycho Onnasch, founder of Zest Protocol. “Unlike on Ethereum, the creation of basic DeFi primitives such as liquidity pools isn’t possible on Bitcoin L1. The Stacks sBTC upgrade is set to be a watershed moment for Bitcoin DeFi, which is what it was designed for from the beginning.”