Introduction
This proposal seeks to introduce the Rootstock blockchain, a pioneering Bitcoin sidechain and EVM-compatible network, to the Venus Protocol community. The goal is to gather feedback on the potential deployment of Venus Protocol on Rootstock, a move that could unlock significant BTC liquidity and expand the utility of Bitcoin through Rootstock’s native BTC-pegged asset, RBTC. Rootstock, a secure Proof-of-Work chain merged-mined with over 50% of Bitcoin’s hash power, provides a safe haven for users who want to leverage their BTC holdings without venturing into other networks. Ultimately, this proposal aims to broaden Venus Protocol’s reach and attract new users from the Bitcoin ecosystem.
Motivation
Integrating Venus Protocol on Rootstock presents a compelling opportunity to tap into the burgeoning demand for decentralized finance (DeFi) applications within the Bitcoin ecosystem. This strategic move aims to bridge the gap between Bitcoin maximalists and DeFi enthusiasts, unlocking a vast, untapped market.
Key Motivating Factors:
- Untapped Potential: Bitcoin’s immense market capitalization remains largely underutilized in the DeFi space. Rootstock, a Bitcoin sidechain with EVM compatibility, offers a secure gateway to activate this dormant liquidity.
- Bridging the Gap: Rootstock caters to both Bitcoin Maxis, who prioritize security, and DeFi enthusiasts, who seek yield-generating opportunities. Venus Protocol can leverage this bridge to attract users from both communities.
- Increasing Demand: The growing demand for wrapped Bitcoin (WBTC) on EVM chains signifies a latent demand for Bitcoin-based collateral projects. Rootstock’s RBTC token can fulfill this need.
- Security & Scalability: Rootstock, secured by Bitcoin’s proof-of-work through merged mining, ensures the safety and scalability necessary for a thriving DeFi ecosystem.
- Proven Success: Rootstock’s recent integrations with prominent projects like Uniswap, The Graph, and Wormhole demonstrate its viability as a platform for DeFi expansion.
By deploying on Rootstock, Venus Protocol can not only attract a new audience and enable BTC utility, but also position itself as a leading player in the evolving landscape of Bitcoin-based DeFi. This strategic move aligns with the growing trend of DeFi applications migrating to Bitcoin, mirroring Ethereum’s trajectory.
Benefits of Deploying Venus Protocol on Rootstock
- Tap into Bitcoin’s DeFi Potential: Rootstock’s thriving ecosystem, with $200 million in TVL and 150+ dApps, offers a direct gateway to the burgeoning Bitcoin-based DeFi market, projected to reach $24 billion by 2025.
- RBTC, the native token pegged 1:1 with BTC: Rootstock’s native token, RBTC, is a BTC-pegged asset redeemable for BTC by the two-way-peg. Through RBTC, Venus will be available to those users that wish to expand BTC utility without lacking Bitcoin security. Considering the high demand of WBTC on EVM chains, Rootstock is addressing this demand by leveraging RBTC as the most secure BTC-pegged asset.
- RIF Token: This utility token is emerging as a key player in the expanding Bitcoin L2 market, as a demand for Bitcoin-based dApps grows, RIF’s is positioning as a significant token in this space. RootstockLabs has been working on several projects and plans that should boost its adoption and expand its utility across the ecosystem in the coming months.
- BPRO Token: this token has the historical performance of +23.2% on top of BTC. It’s a protocol built by bitcoiners with a perfect balance between profit and risk. There is a perpetual incentive program rewards BPRO HODLers with MoC tokens.
- Unlocking stablecoins:
- rUSDT: this is a wrapping version of USDT in the Rootstock ecosystem, it has been driving the adoption of new users through DEX integrations with deep liquidity.
- DOC: it’s the ideal stablecoin for users seeking to hold current value without leaving the benefits of bitcoin. DOC is 100% collateralized with bitcoin with 1:1 USD peg guaranteed by the smart contract. Created by Money On Chain, the largest DeFi protocol on Rootstock, DOC would be the perfect alternative to BTCB
- USDRIF: A RIF-collateralized stablecoin, USDRIF, is backed by RIF token and aims to avoid crypto and fiat volatility by using it for payments, savings and sending.
- Unparalleled Security: Leverage Rootstock’s robust merged mining architecture, backed by 57% of Bitcoin’s hashrate, to provide users with the highest level of security for their assets.
- Seamless Ethereum Integration: Benefit from seamless compatibility with existing Ethereum DeFi tools and infrastructure, thanks to Rootstock’s RSK Virtual Machine (RVM).
- Expanding User Base: Attract a new market segment that values Bitcoin’s security but seeks the yield opportunities of DeFi, bridging the gap between Bitcoin maximalists and DeFi enthusiasts.
- Cross-Chain Synergy: Capitalize on Rootstock’s strategic partnerships with top-tier projects like Uniswap, The Graph, and Wormhole, facilitating seamless asset flow between networks and fueling ecosystem growth.
- Amplifying Bitcoin’s Utility: Enable users to maximize the utility of their BTC holdings through Venus Protocol’s lending and borrowing features while maintaining Bitcoin’s renowned security.
- Rising the Institutional Adoption: Rootstock has been expanding its partnerships with institutional investors by growing their allocation into its network. Venus’ deployment on Rootstock will meet their interest in the ecosystem. Those institutional investors, known for being large BTC holders and seeking to expand BTC utility might find Venus as the right spot for yielding opportunities.
Incentives
Recognizing the monumental opportunity to unlock and capture an emerging market in the Bitcoin-based DeFi ecosystem, this proposal outlines a robust liquidity and incentive strategy designed to attract and retain users on Rootstock.
- Liquidity Bootstrapping: RootstockLabs will support $1.5M Rootstock-based tokens in Venus-specific liquidity. This incentive underscores our firm belief in the market’s potential and serves as a compelling catalyst for Venus users to explore and engage with this promising new landscape.
- Grant: this proposal offers $30k RIF or RBTC tokens in order to support Venus’ deployment and integration on Venus’ UI.
- Co-marketing:
- Co-Market Venus’ launch on Rootstock
- Connect Venus to the large ecosystem of Rootstock-based builders who are eager to work with the money market
- Users incentives:
- Injection of incentives up to $50k
- Including Venus in our Jumper Exchange/LiFi campaign in September
- Unlocking THU campaigns according to the milestones:
- 1st: Deployment - unlocking $10k in incentives
- 2nd: at $5M in TVL - unlocking $20k in incentives
- 3rd: tier: at $15M in TVL - unlocking extra $20k in incentives
Conclusion
Deploying Venus Protocol on Rootstock is not merely a technical integration; it is a strategic leap towards unlocking the full potential of Bitcoin in the DeFi space. By harnessing Rootstock’s unique capabilities, Venus Protocol can tap into a vast, untapped market, driving significant growth and innovation for both platforms.
