The realm of Bitcoin's second-layer solutions is undergoing a transformative phase characterized by an influx of various approaches and innovative frameworks. BounceBit introduces a paradigm shift, moving from a second-layer to a first-layer concept. We invite you to explore the philosophy and strategic decisions guiding BounceBit's development—a chain that redefines the role of BTC.
Redefining the value of Bitcoin: BounceBit's asset-driven PoS first-layer solution
At the core of BounceBit's innovative framework is the belief that Bitcoin infrastructure should primarily be asset-driven, a philosophy that highlights the versatility of BTC. Unlike the restrictive paradigms of existing second-layer solutions that directly anchor to the Bitcoin blockchain, BounceBit stands out as an independent proof-of-stake (PoS) first-layer ecosystem. In this unique network, validators must simultaneously stake BounceBit's native tokens and BTC, establishing a dual-token security system that not only enhances the strength of the network but also increases the intrinsic value of BTC by playing an active role in network validation.
This unique approach avoids traditional protocol-level bindings and instead adopts asset-level integration, effectively merging the reliability of Bitcoin with the innovative potential of BounceBit's native functionalities. By doing so, BounceBit creates a symbiotic relationship between BTC and its own tokens, leveraging the strengths of both to build a more resilient and multifunctional chain.
Transcending the limitations of the Bitcoin main chain, BounceBit embraces interoperability with EVM-compatible chains, recognizing and incorporating staked assets such as BTCB and WBTC on the BNB chain. This not only enriches the use cases for staking BTC but also attracts participation from the entire Web3 ecosystem, thereby enriching the entire BTC asset class.
Transparent CeFi as the cornerstone of the BTC ecosystem
Generating yields for BTC in the context of Bitcoin is a unique challenge, quite different from the yield generation mechanisms associated with Ethereum's Lido. Similar to Bitcoin protocols like Blast and Manta on Ethereum, yields cannot be generated when BTC is held in multi-signature wallets. BounceBit directly addresses this issue by integrating a transparent centralized finance (CeFi) model, utilizing the custodial services of Mainnet Digital and the MirrorX technology of Ceffu. This allows Bitcoin to remain on-chain while participating in trading activities on centralized exchanges (CEX). The results of these trades are reconciled on-chain through a T+1 settlement cycle, ensuring liquidity and transparency.
BounceBit's vision is to enhance rather than replace the inherent integrity and trust of CeFi. By enhancing its transparency, we establish a new foundational moment for Bitcoin, akin to the turning point that occurred with Ethereum through Lido. Our approach aims to enhance trust in CeFi practices by providing users with the right reasons to trust.
Activating active Bitcoin in the ecosystem
Given the inherent conservatism of Bitcoin holders, especially regarding moving assets out of secure cold storage, BounceBit has implemented a plan aimed at activating the most liquid and actively used BTC. This portion of Bitcoin is typically used in EVM-compatible networks and centralized exchanges, serving as the core for trading, lending, and yield-earning activities.
BounceBit supports the seamless transition of pure BTC into more flexible forms, such as BTCB and Wrapped Bitcoin (WBTC) on the BNB chain, enabling them to enter productive activities. Users can choose to deposit their BTC into secure custody services accessible via EVM networks, thereby enabling these assets to bridge onto the BounceBit platform. This process allows users to earn on-chain yields without directly interacting with the Bitcoin main chain.
Challenges addressed by BounceBit
Addressing transparency and abuse issues in BTC Finance 1.0
While BTC Finance 1.0 played an important role, it also had issues with transparency and fund abuse. BTC Finance 2.0 developed by BounceBit is a direct response to these issues. By combining on-chain proof of reserves and transparent activities, BounceBit aims to rebuild trust and provide a safer platform. This approach allows Bitcoin holders to generate yields from idle BTC tokens, addressing a significant gap in previous financial services in the Bitcoin space.
Addressing the underutilization of Bitcoin assets
A significant challenge faced by many BTC holders is the underutilization of their assets, leading to missed profit opportunities in emerging fields like DeFi and NFTs. BounceBit addresses this issue by providing Bitcoin holders with pathways to actively engage their assets in these markets. This participation not only offers profit opportunities for holders but also enhances the overall liquidity and vitality of the Bitcoin ecosystem.
Enhancing the utility and expanding use cases of Bitcoin
BounceBit is committed to enhancing the utility of Bitcoin. It aims to drive the adoption of BTC applications in a transparent and efficient environment, expanding the use cases and yield opportunities for Bitcoin, and leveraging its status as a primary asset. This includes creating an inclusive ecosystem for retail and institutional investors, democratizing access to Bitcoin-based financial products.
Bridging the gap in smart contract capabilities
The lack of a robust smart contract platform in the Bitcoin ecosystem has limited the development of complex decentralized applications (dApps). BounceBit recognizes the importance of this functionality and is committed to integrating smart contract capabilities, enabling BTC holders to utilize their assets in richer and more beneficial ways.
Unified BTC across multiple chains
BounceBit also addresses the problem of scattered Wrapped BTC across various blockchain networks. By developing a unified platform that integrates these diverse forms of Wrapped BTC, BounceBit aims to centralize liquidity and simplify transactions between different blockchain networks, thereby improving the efficiency and liquidity of BTC assets.
BounceClub: Built on BounceBit
Foundational Philosophy
BounceBit's guiding philosophy is deeply inspired by Apple Inc.'s spirit of innovation and user-centered design. Apple's success is attributed not only to the functionality of its products but also to their elegant design and user-friendly interfaces.
Inspired by Apple's business model, BounceBit aims to revolutionize the traditional on-chain development approach by introducing the concepts of BounceClub and the BounceBit app store. As a component of the BounceBit ecosystem, BounceClub aims to simplify smart contract deployment and reduce redundancy in dApps.
What is BounceClub?
BounceClub is an on-chain Web3 universe that enables everyone to customize, launch, and participate in decentralized applications. BounceClub owners can customize their BounceClub by simply selecting protocols listed in the BounceBit app store, much like downloading apps on an iPhone. The BounceBit app store serves as a Web3 plugin library, welcoming developers to apply to list their smart contracts, just like publishing apps in the iOS app store. Users without a BounceClub can also browse existing BounceClubs and participate in various Web3 activities to earn rewards.
How does BounceClub work?
If you are eligible to claim and own a BounceClub, setting it up is very simple: select the protocol you need from the BounceBit app store, a process similar to downloading an app from the app store on an iPhone, without needing to write code. In other words, customizing a BounceClub is very user-friendly for both developers and individuals without coding skills.
For those who do not own a BounceClub, you can browse BounceClubs created by others and participate in various Web3 activities offered.
Developers are invited to submit their smart contracts to be listed as plugins in the BounceBit app store, a process similar to publishing apps on the iOS app store. Developers can choose from four different smart contract deployment models: 1) open to everyone; 2) exclusive to one or specific BounceClub; 3) implement deployment fees; 4) provide rewards to the BounceClub owners deploying the contracts, such as airdrops.
Infrastructure: Parallel yield generation for CeFi + DeFi
BounceBit introduces a unique feature—parallel yield generation from CeFi and DeFi. Users can earn original CeFi yields while re-staking through LSD that utilizes BTC staking and on-chain farming. This ecosystem provides Bitcoin holders with three types of yields: original CeFi yields, node operation rewards for staking BTC on the BounceBit chain, and opportunity yields generated by participating in on-chain applications and Bounce Launchpad.
BounceBit's infrastructure is meticulously designed to elevate the status of Bitcoin from a passive asset to an active yield-generating tool. By providing a comprehensive platform that enables Bitcoin holders to leverage the advantages of both CeFi and DeFi, BounceBit is opening a new chapter in asset optimization and financial innovation within the blockchain space.
