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Bitcoin DeFi app Sovryn is expanding to the Ethereum blockchain with the help of hybrid layer-2 network developer Build on Bitcoin, the two companies announced on Thursday.

Sovryn is a decentralized platform launched at the end of 2020 that offers lending, borrowing, and margin trading through smart contracts in the Bitcoin ecosystem. Built as a DAO on the Bitcoin sidechain Rootstock (RSK) that allows for the creation of smart contracts, Sovryn has been working to enhance Bitcoin with advanced DeFi capabilities.

The first project that Sovyrn will launch on Build on Bitcoin is a decentralized exchange (DEX) called Dex 2.0. The group claims this project will come with lower gas fees and faster transactions than competitors like Uniswap, and “unparalleled capital efficiency.”

“We've known Sovryn for a long time, and they've definitely been spearheading a lot of the early DeFi work in the Bitcoin space,” Build on Bitcoin co-founder Alexei Zamyatin told Decrypt. “Egan was the first person I called up when we started working on [Build on Bitcoin], trying to get him excited about expanding the Sovryn ecosystem and also trying to learn about the struggles they had.”

A layer-2 protocol refers to technology designed to mitigate congestion on a blockchain by creating a secondary chain that works in conjunction with the main network. For example, the Lightning Network is a layer-2 micropayments protocol for Bitcoin. Other examples of layer-2s include Arbitrum and Optimism on Ethereum.

"With Build on Bitcoin, you can use 350 [Ethereum Virtual Machine] wallets," Zamyatin said. "For the layman, that means you can pick almost any wallet; it doesn't necessarily need to be Bitcoin only or deal with UTXOs. It makes the whole thing much more user-friendly."

In January, Sovyrn launched BitcoinOS, which uses what the company called “sovryn rollups” to create a foundational layer for decentralized apps (dapps) on Bitcoin.

“By joining forces with BOB, we are not only expanding Sovryn's reach but also creating a DeFi ecosystem that is accessible to millions of Bitcoin users worldwide,” Sovryn co-founder Egan Yago said in a statement.

On Sovryn’s Dex 2.0, Zamyatin explained, users can select different networks via the user interface, such as the BOB Ethereum layer-2 protocol. He noted that the selection process is similar to choosing between Ethereum, Optimism, and Arbitrum on Uniswap.

When asked why developers are focused on bringing DeFi to Bitcoin, Zamyatin said it was because of Bitcoin's reliability.

"Bitcoin is the backbone of the entire Web3 ecosystem. If Bitcoin falls, everything else falls, if everything else breaks Bitcoin is still there," he said. "I think that is one of the main properties of Bitcoin—it's stable and robust. Bitcoin is predictable."

With renewed interest in the number-one blockchain by market capitalization stemming from projects like Ordinals and the approval of Bitcoin ETFs, Zamyatin is optimistic about the future of Bitcoin development.

“Bitcoin had its harsh times when nobody wanted to really engage with it,” Zamyatin said. “We both had a feeling that it was going to have a renaissance, and luckily, we were right.”

Edited by Ryan Ozawa and Andrew Hayward

Editor's note: This story was updated after publication to clarify descriptions of Sovryn and Build on Bitcoin.

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Table of contents

Satoshi Protocol, a prominent stablecoin protocol that gets support from Bitcoin, has announced an exclusive collaboration with Soveryn. The partnership between Satoshi Protocol and the BOB chain-based DeFi protocol Sovryn will unveil a SAT-wBTC pool to boost the utility and liquidity of SAT in the BOB ecosystem. The platform disclosed the development on its official account on X.

Partnership with @SovrynBTC
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Our collaboration introduces a new SAT-wBTC liquidity pool, boosting $SAT utility and trading options on BOB.
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Thrilled to announce our partnership with @SovrynBTC, the leading BTCfi Hub on the BOB chain. They offers secure, fast Bitcoin trading… pic.twitter.com/hV6n4rWj2K

— Satoshi Protocol (@Satoshi_BTCFi) July 31, 2024 Satoshi Protocol Commences an Exclusive Collaboration with Sovryn In its latest X post, the company mentioned that Sovryn operates as a decentralized finance protocol on the BOB chain. It reportedly offers several financial services taking into account liquidity provision and trading. Sovryn benefits from the security of Bitcoin along with the smart contract flexibility to deliver resilient financial instruments. Sovryn has additionally attained crucial landmark achievements.

They include more than $85M in its total value locked part from more than $2B worth of cumulative trading volume. Additionally, the total consumer base of the platform has reportedly reached 60,000. Sovryn is integrated with the BOB chain, expanding its platform with diverse integrations and financial services. Moreover, Sovryn delivers decentralized trading, margin trading, borrowing, and lending tools.

Bitcoin network secures all of these products. This partnership will permit the development of a Sovryn-based SAT-wBTC pool. The integration will chiefly enhance liquidity for SAT. As a result of this, the consumers can conveniently trade between the SAT token and the rest of the Sovryn-based coins. This takes into account the well-known tokens such as USDC, ETH, SOV, wBTC, DLLR stablecoin of Sovryn, and so on.

Improved liquidity signifies that the clients can conduct trades more effectively with decreased slippage and enhanced pricing. The integration of SAT within the ecosystem of Sovryn broadens its utility. It provides additional opportunities to facilitate the consumers in engaging with assets. The inclusion in the extensive DeFi package of Sovryn lets SAT holders take part in a broad series of financial operations.

The Development Enhances Liquidity, Capital Efficiency, and Utility in the BTC Ecosystem It includes generating yields via liquidity provision and using SAT in the form of collateral concerning loans. Ingamar Ramirez, Sovryn’s Head of Ecosystem Growth, stated that this collaboration will let them offer additional options regarding decentralized stablecoins. Satoshi Protocol asserted that the partnership will combine the strengths of both entities to capital efficiency, liquidity, and utility in the BTC ecosystem.

AUTHOR

Umair Younas is a cryptocurrency-related content writer linked with this work since 2019. Here, at Blockchainreporter, he serves as a news and article writer. He is a crypto, blockchain, NFTs, DeFi, and FinTech enthusiast. He has strong command over writing authentic reviews about brokers and exchanges and he has collaborated with our education team to write educational content as well. He has a dream to raise awareness among people about digital currencies. His works are well-researched and brimmed with information hence they provide fresh insights. Stay tuned to his posts if you want to stay up-to-date with the crypto-verse.

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