List TBTC as Collateral Asset

Joint Proposal by @ramaruro, @benlongstaff and EstebanK

Summary

We propose to add TBTC to CREAM for lending and borrowing.

TBTC is a fully Bitcoin-backed ERC-20 token pegged to the price of Bitcoin. TBTC release candidate 1 went live in September 2020 and currently has $32M in TBTC locked.

For: List TBTC as collateral asset Against: Do nothing

Benefits for CREAM

New user base: Each Bitcoin on Ethereum project brings with it a community who resonate with the projects values. This proposal will allow the CREAM TVL to expand, and the TBTC community to borrow other Assets against their TBTC.

Additional strategies: As CREAM starts to collaborate with the Yearn Ecosystem there might be additional opportunities to use TBTC through CREAM.

Diversity of choice for BTC based Collateral: Currently CREAM supports:

• HBTC (Huobi BTC)
• BBTC (Binance Wrapped BTC)
• RenBTC

TBTC offers an alternative that has been fully decentralised from launch.

Benefits for the general DeFi Community

Bring Optionality to the DeFi Community with a decentralized Bitcoin Exposure.

Decentralized Assets are essential for DeFi to stay “Decentralized”. It is important to keep that prospective in mind as a lot of liquidity based on Centralized Assets has flown into the DeFi Ecosystem.

Details about TBTC

The tBTC system is developed by the Keep Network.

tBTC is

• Decentralized
• Trustless
• Permissionless
• Fully collateralized
• Open Source
• Audited

Each bitcoin deposit is stored in a separate wallet created by the signers. The protocol has strong economic security measures. Depositors don’t have to trust custodians, aka signers, because signers deposit an ETH bond higher than the value of the BTC they hold in custody.

In the event that signers colluded to steal BTC the network would seize their ETH bond (150% of the BTC they have signed for) and slash their KEEP stake by the minimum stake amount (currently 70,000 KEEP).

The permissionless nature can be summed up by:

Question - “How many doors would you have to kick down to stop my TBTC being redeemed for BTC?” Answer - “Good luck finding the doors”

Current Liquidity and Availability

TBTC Statistics:

This site shows current Supply of TBTC, total Value Locked, Mints and Redeems, as well as Bonded Value (securing the TBTC) (https://keepstats.org/)

Pools available in Curve, Uniswap, and Balancer

Currently there are Rewards Incentives for holding TBTC Curve Pool: the LP token can then be deposited in Harvest and BadgerDAO.

=====Contents above are drafted by ramaruro===== Discussion link: https://forum.cream.finance/t/proposal-add-tbtc-as-collateral-asset/264