A yield-generating Bitcoin token has been introduced by Solv Protocol on the Avalanche blockchain, providing institutional investors with increased access to earning opportunities supported by real-world assets (RWAs).
On May 16, the introduction of SolvBTC.AVAX was announced by the protocol—a token designed to link Bitcoin to real-world assets such as U.S. Treasurys and private credit instruments provided by firms like BlackRock and Hamilton Lane.
According to the company, the development of the new token was carried out through a collaborative effort involving seven partners: Solv, Avalanche, Balancer, Elixir, Euler, Re7 Labs, and LFJ.
It was stated by Solv Protocol founder Ryan Chow that the token serves as a method for connecting Bitcoin to “real-world economic cycles” through uncorrelated assets like U.S. government bonds and private credit, rather than relying on Bitcoin’s conventional four-year boom-and-bust cycle.
A multi-protocol strategy is employed by the token to produce yield, utilizing Elixir’s deUSD stablecoin, U.S. Treasurys supplied through Elixir by BlackRock and Hamilton Lane, and integration with the lending platform Euler to enhance exposure to real-world assets (RWAs).
Solv is recognized as a Bitcoin-focused staking platform that provides yield-generating strategies across multiple blockchains and decentralized finance applications. As reported by industry data, over $2.3 billion in total value has been secured within the protocol.
Competition Heats Up in the Bitcoin Yield Market
Amid the recent surge in institutional adoption of digital assets, an increase in demand for Bitcoin yield solutions has been observed.
The Bitcoin Yield Fund was introduced earlier this month by the crypto exchange Coinbase, with the objective of providing annual returns ranging from 4% to 8% on Bitcoin holdings.
It was stated by that the yield would be generated through a cash-and-carry strategy, wherein Bitcoin is acquired on the spot market and a matching futures contract is sold.
A rise in interest surrounding Bitcoin yield was anticipated by CoinShares analyst Satish Patel in December, who observed that an increasing number of investors now view BTC “not only as a store of value but also as a means to generate yields.”
Although various methods exist for generating Bitcoin yield—including the use of derivatives and yield farming—a distinct “BTC Yield” metric was introduced by Michael Saylor’s Strategy to evaluate the effectiveness of its investment approach.
According to the company, Strategy’s BTC Yield—which assesses the amount of additional Bitcoin being acquired in relation to its outstanding shares—has reached 15.5% year-to-date.
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