In breaking news shared with Finbold on September 25, Hermetica, a platform for Bitcoin-backed stablecoins, is introducing its synthetic dollar, USDh, to the Stacks Bitcoin Layer 2 (L2) network. This move marks a significant development as USDh becomes the premier Bitcoin-backed stablecoin to merge with the flourishing Stacks ecosystem.
Dylan Floyd, CEO of Bitflow, expressed his enthusiasm for the launch of USDh, highlighting its qualities as a stablecoin fully backed by Bitcoin, promoting capital efficiency, and offering sustainable crypto-native yield. Bitflow plans to introduce new pools for USDh in its AMM DEX to provide users with deep stablecoin liquidity. With their aggregator, USDh can be promptly exchanged with any other SIP10 token right from Day 1.
USDh plays a pivotal role in Bitcoin DeFi by offering a stable, dollar-pegged coin fully supported by Bitcoin, enabling users to earn up to a 25% yield while remaining within the Bitcoin ecosystem. Unlike conventional stablecoins tied to fiat currencies, USDh empowers users with full asset control, eliminating the involvement of third-party financial institutions.
Jakob Schillinger, Hermetica’s CEO, emphasized the significance of this integration, underscoring the necessity for a thriving ecosystem of Bitcoin L2s to scale Bitcoin effectively. USDh’s introduction to Stacks brings vital infrastructure to one of the prominent Bitcoin ecosystems, facilitating Bitcoin-backed yield and a liquid dollar asset crucial for scaling Bitcoin DeFi on Stacks.
Despite the global stablecoin market surging to $160 billion in the last five years, the vast potential of Bitcoin’s staggering $1.3 trillion market cap remains largely untapped. Presently, DeFi protocols harness only 1% of Bitcoin’s value, unlocking a colossal $360 billion opportunity. Hermetica aims to capitalize on this opportunity by offering a stablecoin secured by Bitcoin, operating seamlessly on both Bitcoin’s L1 and L2 networks.
USDh’s direct peg to Bitcoin, with 1 USDh equaling 1 USD worth of satoshis, furnishes users with a stable, dollar-linked asset without necessitating them to exit the Bitcoin ecosystem. Recognizing the essence of stablecoin liquidity, Tycho Onnasch, CEO of Zest, foresees USDh as a pivotal component of the Stacks ecosystem that can bolster lending protocols substantially.
Peter Watson, CMO of Velar, commended the launch of Hermetica (USDh) on the Stacks network, introducing a much-needed stablecoin reinforced by Bitcoin. Backed by a resilient team embracing Bitcoin’s decentralized values, USDh offers a durable asset for the ecosystem, enhancing accessibility by listing it on Velar’s DEX.
Initially launched on the Bitcoin Layer-1 Runes protocol, USDh swiftly amassed $2 million in Total Value Locked (TVL) during a private whitelist phase, signifying the evident demand for Bitcoin-backed stablecoins within DeFi. As Stacks gears up for a significant upgrade in September 2024 to include 5-second block times and full Bitcoin finality, DeFi growth is poised to accelerate. The inclusion of USDh stands as a significant milestone for both the platform and Bitcoin-backed financial tools in general.