DeFi Technologies will launch validator nodes on the core chain and stake nearly $100 million in Bitcoin (BTC) on them. Toronto-based DeFi Technologies will receive rewards for transaction verification and staking rewards through its subsidiary Valour.
Staking is enabled on a layer 1, BTC-based blockchain through the Core’s Ethereum Virtual Machine compatible consensus mechanism. DeFi Technologies CEO Olivier Roussy Newton said:
“We are advancing our mission to bridge traditional finance and innovative blockchain technology. (…) This approach provides investors with unique exposure to returns and growth within the digital asset space.”
Stakers retain control of their BTC during the lock-up period and are rewarded with CORE tokens that are reinvested in the product. Staked CORE offers a reward of 11.66%.
Security is maintained by distributing 50% of BTC mining hash power to the blockchain itself. Excluding the new DeFi Technologies stake, Core holds over 2,800 BTC.
DeFi technologies and Core are already collaborating.
This is the second stage of organizational collaboration. On May 10, they launched the Valor Bitcoin Stake exchange-traded product on the Nordic Growth Market exchange, using Swedish Krona as the base currency.
Related: DeFi Technologies Subsidiary Valor Surpasses $274 Million AUM
Valor ETP, which claims to be the first yielding BTC ETP, offers BTC exposure with a yield of 5.65% and a 1.9% management fee. The partners also plan to launch a Core ETP that will offer returns through BTC staking.
Valor offers 12 different coins, including Uniswap and Polkadot, and 10 coin baskets, ETPs based on Bitcoin Carbon Neutral (BTCN) and the STOXX Bitcoin Suisse Digital Asset Blue Chip X Index. Some products have no administration fees.
DeFi Technologies Looking for Plum with BTC Pivot
This decision is in line with DeFi Technologies’ recent move to increase its reliance on BTC. DeFi Technologies announced on June 10 that it had adopted BTC as its primary treasury reserve asset and purchased 110 BTC as part of that strategy. The announcement sent DeFi Technologies shares soaring 23%.
As of May 31, DeFi Technologies had a cash balance of $51 million and Valor’s assets under management (AUM) was $607 million. As of mid-March 2022, Valour’s AUM hit $274 million.
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