The Lorenzo Protocol’s partnership with the Cetus Protocol, a liquidity protocol and decentralized exchange on the Sui Network, marks a significant stride in expanding Bitcoin liquidity on the Sui Network. Announced on the X platform today, November 26, 2024, this collaboration aims to amplify the adoption of stBTC, Lorenzo Protocol’s Bitcoin staking token, within the Sui ecosystem.
This strategic alliance opens fresh avenues for Bitcoin holders on the Sui Network to stake Bitcoin and mint stBTC. The move is designed to increase Bitcoin user participation on the Sui network, encouraging Bitcoin holders to stake their tokens and earn rewards in the form of Lorenzo’s liquid restaking token (stBTC). This partnership not only propels the growth of the decentralized finance ecosystem but also positions stBTC as a primary financial instrument within the Sui network, facilitating the lending, borrowing, and trading of Bitcoin products.
The Sui network, a layer 1 blockchain, was designed to facilitate rapid, low-latency transactions making it a preferred choice for real-time applications such as DeFi, gaming, and other responsive services. Since its launch in 2023, the Sui network has accrued about $1.4 billion in Total Value Locked (TVL).
Despite Bitcoin’s market capitalization of $1.8 trillion, the largest in the market, its potential remains largely untapped. The opportunities for practical applications and yield generation have been relatively limited in the Bitcoin market. Historically, Bitcoin holders could only profit from their holdings by depositing funds on Centralized Exchanges (CEXs) or converting their assets into wrapped tokens like WBTC.
Bitcoin’s limitations within the DeFi landscape have curtailed holders’ ability to engage in a wide range of financial activities. This has hindered Bitcoin users from interacting with DeFi activities and earning diversified returns, unlike other tokens such as Ethereum and Solana.
This groundbreaking partnership between Lorenzo and Cetus Protocols seeks to revolutionize the Bitcoin market by enabling Bitcoin staking. This transformation will turn Bitcoin into an income-generating instrument akin to Ethereum, which allows users to stake native tokens and earn incentives. Similarly, Bitcoin Layer 2 networks are gradually enabling users to stake Bitcoin to secure transactions and earn rewards, thereby unlocking Bitcoin’s unexploited potential.
