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Hermetica has added USDh, a Bitcoin-backed stablecoin, to the Stacks Layer 2 network, a crucial step toward decentralized finance. According to a press statement shared, USDh, a stablecoin backed by Bitcoin and tied to the US dollar, now offers up to 25% returns. Unlike traditional stablecoins, backed by bank cash reserves, USDh is completely connected to Bitcoin. This enables Bitcoin users to earn yield while transacting in dollars without leaving the Bitcoin network.
USDh gained popularity on Bitcoin's Layer 1 four months ago and swiftly garnered $2 million in Total Value Locked, indicating a high demand for Bitcoin-backed stablecoins. By extending to Stacks, a Bitcoin L2, Hermetica hopes to reach a bigger DeFi user base while keeping Bitcoin's security characteristics. Stacks recently modified to provide quicker block times are an excellent foundation for USDh growth. Major decentralized exchanges, like Bitflow Finance, Velar, and Zest Protocol, are adopting USDh and increasing its use in the ecosystem. This initiative intends to unleash Bitcoin's latent potential by enabling holders to access stablecoin liquidity without leaving the Bitcoin ecosystem. With just 1% of Bitcoin's $1.3 trillion market capitalization invested in DeFi, USDh has the potential to bridge the gap between Bitcoin's value and the growing DeFi sector.
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