Bit Protocol - Upcoming features, leveraged longs
It's been a month since Bit Protocol's launch, and I thought to touch on a few subjects regarding ongoing progress. A Medium article came out a few days ago with updates regarding the work that's been done and you can read it here:
https://medium.com/@bitusdprotocol/bit-protocol-january-update-f0d372b859ad
What is included in the article:
- Key collaborations and integrations with Partners, Listings
- New Collateral Options, Potential Big New Partner
- Additional Liquidity Pools
- Oasis Ecosystem Synergies
- Milestone Reached in TVL
Neby & Thorn's liquidity pools offer a way to earn money with BitUSD. We don't have our own local pools up yet, but they are on the way, as well as a notice bot for Telegram & other exciting functions. In the meantime I thought to add a guide to maximize your BitUSD gains: Looping borrowing allows you to get more bang for your buck, for those of us who don't mind a little bit of risk and manage our loans actively. :) Be aware that Thorn offers a stableswap, which allows you to swap collaterals with minimal slippage. Links for Thorn and Neby are:
https://app.thornprotocol.com & https://www.neby.exchange/
If you would like to loop with wstROSE, you can mint & stake for it at https://accumulated.finance
How to Loop Borrowing with bitUSD
Loop borrowing is a powerful DeFi strategy that allows users to maximize capital efficiency by repeatedly borrowing and supplying assets. With BitUSD, users can leverage this technique to increase their exposure while maintaining stability.
Step-by-Step Guide to Loop Borrowing with bitUSD
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Supply Collateral – Deposit a supported collateral asset (e.g., ROSE, wstROSE) into the BitUSD Protocol to mint bitUSD. The amount you can borrow depends on the collateral ratio.
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Mint bitUSD – Once your collateral is supplied, mint bitUSD up to the protocol’s borrowing limit. Ensure that you maintain a safe collateralization ratio to avoid liquidation.
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Swap bitUSD for More Collateral – Use a decentralized exchange (DEX) like Thorn or Neby to swap your borrowed bitUSD for the same collateral asset you initially deposited. You can use the redeem function for this as well, although the redemption fees might incur costs.
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Reinvest as Collateral – Deposit the newly acquired collateral back into the BitUSD Protocol to increase your borrowing capacity.
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Repeat the Process – Continue looping until you reach your desired leverage level or the protocol's risk limits. Each loop increases your exposure while compounding potential rewards.
Benefits and Risks
✅ Maximizes Capital Efficiency – Users can earn more yield by leveraging their assets.
✅ Staking Rewards – Some collateral assets, like wstROSE, continue to generate staking rewards even when used for borrowing.
⚠️ Liquidation Risk – Over-leveraging can lead to liquidation if collateral value drops.
⚠️ Interest Costs – Borrowing fees can accumulate over time, affecting profitability.
By using loop borrowing strategically, BitUSD users can optimize their DeFi positions while managing risk effectively.
That's it! Gongrats on more capital exposure. I will continue to post about BitUSD's progress to achieve a dominant omnichain stablecoin position - early adopters could be rewarded in the future :)
