Building a DeFi protocol, the hardest part is always going from 0 to 1.

Especially in the Bitcoin ecosystem, the trust cost is extremely high. Instead of spending years building a new credit system, it is better to directly reuse the already mature solutions available in the market.

@Lombard_Finance's recent operations are a typical example of this logic. They integrated $538 million of BTC.b, which directly propelled them to the peak🌊.

✦ The background is simple: Bitcoin has a market capitalization of $2.1 trillion, but the funds entering Decentralized Finance (DeFi) are less than 1%.

Lombard did not choose to issue a new asset to compete for this 1% from scratch, but instead opted for a more efficient path - integrating BTC.b!

🌟 The following are the three core logic points of this strategy:

1. Asset side: directly obtain mature liquidity

Lombard acquired approximately 538 million dollars in circulating BTC.b.

This is not only a consolidation of funds but also an inheritance of the ecosystem. BTC.b has already been validated by the market as a mature product, with 12,000 holders, and has been deeply integrated into mainstream DeFi protocols such as Aave and GMX. With this step, Lombard has directly completed the early accumulation of liquidity.

2. Product side: Upgrade from packaging to native protocol

This is not just a simple asset migration.
The core work of Lombard is to upgrade BTC.b from a "cross-chain wrapped asset" to a "permissionless, decentralized" Bitcoin asset operating on the Lombard protocol. This enhances the asset's censorship resistance and composability in Decentralized Finance.

3. Market Side: Skip the cold start phase

For any BTCFi project, the hardest part is building trust and obtaining liquidity from 0 to 1.
Lombard chooses to scale based on existing mature products rather than reinventing the wheel from scratch. This is a highly capital-efficient approach that can quickly unlock the trillion-dollar liquidity market of Bitcoin.

Summary💡

Lombard's initiative demonstrates a new approach in the BTCFi space: releasing liquidity through the integration of quality existing assets and protocol upgrades.
This may be the most practical and efficient solution currently connecting Bitcoin and Decentralized Finance.

@KaitoAI​#Lombard #BTCFi #Yaps