Liquidium: NFTfi on Bitcoin
Liquidium is a peer-to-peer (P2P) lending protocol specifically tailored for Bitcoin, utilizing Bitcoin-based assets such as Ordinal inscriptions and BRC-20 tokens as collateral. This innovative approach is enabled by Partially Signed Bitcoin Transactions (PSBT) and Discrete Log Contracts (DLC), all executed on the Bitcoin network itself.
Similar to P2P lending platforms on Ethereum, borrowers have the flexibility to pledge their assets according to the terms they see fit, while lenders can choose to provide loans based on their own risk appetite and term. The platform’s borrowing interest rate is 20%.
Liquidium supports a variety of popular collections on Ordinals, including Nodemonkes, Bitcoin Frogs, and OMB. Lenders have the opportunity to earn competitive returns on BTC, with loan annual interest rates ranging from 65% to 100%.
Since its inception, Liquidium has provided a cumulative trading volume of over 201.5 BTC (approximately $10.49 million) for 4,492 completed and active loans. Importantly, there is a clear upward trend in daily loans, indicating increasing demand. There is currently an ongoing points program where users can earn points by participating in lending activities on the platform.
BitSmiley – Bitcoin’s MakerDAO
BitSmiley is a Bitcoin DeFi protocol covering three DeFi verticals: stablecoins, lending, and derivatives. The protocol allows for the minting of an over-collateralized stablecoin called bitUSD (based on the bitRC-20 standard), which introduces Bitcoin’s first native stablecoin directly backed by BTC. The bitRC-20 standard provides more powerful functionality than the typical BRC-20 standard to support the operation of bitUSD. In order to mint more bitUSD, users must stake BTC as collateral, similar to other collateralized stablecoins such as DAI on Ethereum.
In addition to stablecoins, the protocol also aims to launch:
- BitLending, which is Bitcoin’s native P2P lending protocol
- Credit default swaps (CDS) allow loans to be bundled and credit defaults assessed based on different default rates.
In the coming years, as the number of inscriptions will reach into the billions, Holy Grail collectors may be attracted to early inscription figures because of their historical provenance. While a large proportion of inscriptions under 10K consist of single random images, there are some more cohesive collections of these early inscriptions that may be of interest to collectors.
These include (but are not limited to):
Ordinal Punks: The first 650 Ordinal Punks are engraved with 100 Ordinal PFP
Bitcoin Shrooms: The first 1075 Ordinals inscribed with 210 pixelated mushroom art
The Fiat Collection: The earliest series of Ordinals engraved on Bitcoin, among the first 117 serial number inscriptions
Inscribed Pepes: A collection of 69 1/1 "Pepe the Frog" inscribed in the first batch of 2189 Ordinals.
Planetary Ordinals: The 1103rd Ordinals inscribed with 68 on-chain art collections
Taproot Wizards: 2121st Ordinals PFP Inscription among top 2625 Ordinals, led by Udi Wertheimer
Timechain Collection: 21 Ordinals clock artifacts among the first 377 Ordinals inscriptions
To illustrate our point, Inscription #2, depicting a dancing bird, sold on February 28 for a whopping 24.48 BTC (approximately $1.4 million), setting the record for the most expensive Ordinals inscription sale to date. It underscores the existence of serious collectors who are willing to invest large sums of money to own a piece of early Ordinals history. Looking to the future, it is conceivable that the Museum of Modern Art may begin acquiring and displaying Bitcoin digital artifacts with significant cultural and historical value.
The complete list of sub-10k Ordinals collections can be found here. Additionally, our previous coverage of Ordinal Punks, Bitcoin Shrooms and Taproot Wizards can be found here.
in conclusion
There has never been a more exciting time to explore Bitcoin.
Despite Bitcoin's status as a trillion-dollar asset, until recently much of its capitalization remained passive. However, more and more users are actively participating in the Bitcoin ecosystem.
Ordinals kicked things off, spurring development activity on a chain that had been largely dormant. Today, the Bitcoin landscape is vibrant and diverse, filled with memecoins, digital art, profile pictures (PFPs), Layer 2 solutions, and DeFi products. This feels a lot like the explosive growth Ethereum experienced between 2020 and 2021.
Interest in Bitcoin remains high, and its continued development will continue to dominate the news. Builders unite in pursuit of sustainable transaction fees for Bitcoin. The launch of Runes during the Bitcoin halving in April will be a key event to watch.
There’s no doubt about it: 2024 is going to be a big year for the Bitcoin ecosystem.
