Secure Bitcoin Preservation
A yield-bearing BTC asset for institutional and retail investors
How BIMA’s Borrow/Lend Protocol Works
USBD can now serve as both a stable source of income and a tool for unlocking liquidity — creating a circular flow that enhances capital efficiency across the BIMA protocol.
Lending Flow
Lenders deposit USBD into BIMA’s lending pool and earn a variable annual yield. The system distributes interest to lenders proportionally based on their share of the pool.
Variable Rate: Expected APY ranging between a 3-5% range, providing lenders with market rate returns.
Auto-Compounding: Interest accrues automatically, growing the lender's position over time.
Liquidity On-Demand: Lenders can withdraw their USBD at any time (subject to the pool's utilization rate).
This approach removes interest rate uncertainty, making USBD a reliable yield-bearing asset for BTC-backed liquidity.
Borrowing Flow
Minters/holders deposit USBD into the protocol to access liquidity. All loans are over-collateralized to protect lenders and system health.
Variable Borrowing Cost: Borrowers can plan and deploy capital effectively with the variable interest rate.
Over-Collateralization: To borrow $100, a borrower must lock $150 worth of USBD or collateralized assets.
Flexible Repayment: Interest accrues on the borrowed amount, and borrowers can repay at their convenience.
This variable-rate structure allows borrowers to unlock capital with full visibility into their borrowing costs, while lenders benefit from consistent, sustainable returns.
Liquidation Process
To maintain health and stability, BIMA automatically liquidates under-collateralized loans:
If a loan’s collateral value falls below the required ratio, it is flagged for liquidation.
Collateral is partially liquidated to restore the required ratio and repay the debt.
Lenders remain fully protected, as over-collateralization ensures loan recovery.
This automated mechanism protects both lenders and the protocol while incentivizing borrowers to maintain healthy positions.
These stability features are further detailed in “Risk Management and Liquidation”
How BIMA’s Stability Pool Works
When a borrower’s collateralized loan falls below the required ratio, their position is liquidated, and the Stability Pool absorbs the liquidated collateral.
Depositors in the Stability Pool receive:
Discounted Collateral: BTC or USBD liquidated at a favorable price.
Continuous Rewards: Depositors earn incentives for contributing to system stability.
Think of the Stability Pool like a commercial real estate owner leveraging existing properties to expand. Borrowers use their BTC-backed USBD to access liquidity while maintaining ownership of their collateralized assets. Liquidation events redistribute this value to Stability Pool depositors at a discount, much like an investor acquiring distressed assets below market value for long-term gains.
This approach mirrors strategies adopted by institutional players like MicroStrategy, where BTC positions are leveraged to acquire more BTC-backed assets, growing overall exposure and yield over time.
Depositor Benefits
Stability Pool depositors are rewarded with discounted BTC or USBD liquidated assets.
Rewards accumulate while supporting the protocol’s health and solvency.
This creates a self-reinforcing system: depositors earn while the system remains stable.
Earn: Multi-Layered Yield Opportunities
The Earn program introduces a multitude of yield-bearing vaults, unlocking opportunities for BTC holders and USBD stakers to generate stable and sustainable yields.
USBD → sUSBD: Users stake USBD into yield-bearing vaults to receive sUSBD (staked USBD). This token represents the user’s position in the Earn program and accrues rewards over time.
Multi-Strategy Yield Vaults: The Earn program brings a variety of strategies to maximize BTC capital efficiency:
Gamma-Neutral Hedging: Yield generation while minimizing volatility and directional exposure.
Cross-Chain Yield: Deploy USBD across EVM, Bitcoin L2s, Solana, and STX to aggregate returns.
Lending Markets: Earn stable yields by lending USBD to borrowers.
These strategies allow users to earn yield on their BTC holdings without liquidating assets, creating an efficient flow of capital within the BIMA ecosystem.
Liquidity Unlocks and Redemption
To ensure sustainable and predictable liquidity for sUSBD holders, the Earn program includes monthly liquidity unlocks with a structured redemption mechanism:
Monthly Unlocks: Once every month, liquidity becomes available for sUSBD redemption.
7-Day Redemption Window: Users have a 7-day window to redeem sUSBD for USBD at a 1:1 ratio.
Auto-Rollover: If sUSBD is not redeemed during the window, it automatically rolls over into the next month’s cycle to continue earning rewards.
This system balances yield optimization with liquidity management, ensuring that users can exit their positions without disrupting the broader protocol.
The result is a self-reinforcing flow: Stability Pool depositors protect the protocol, sUSBD stakers generate yield, and BTC liquidity remains active across the ecosystem.
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