Elastos, a provider within the SmartWeb ecosystem, has announced a strategic collaboration with Layer 2 platform BEVM, aiming to introduce a peer-to-peer lending service denominated in Bitcoin. This initiative, unveiled in a press release on June 28th, is geared towards tapping into an estimated $1.3 trillion of untapped value within Layer 1 networks. The partnership is poised to support what is envisioned as the “Third Age of Bitcoin,” a phase where transactions increasingly utilize native Bitcoin, thus bolstering the expanding Bitcoin ecosystem.
Through this partnership with BEVM, Elastos aims to develop a Bitcoin Native lending product that allows users to pledge up to 80% of their assets as collateral. In return, they would receive L2 credit, such as stablecoins, under terms defined by a Bitcoin-secured smart contract. Central to this endeavor is the pivotal role of BeL2, facilitating the implementation and operation of this innovative financial solution.
What Part Does BeL2 Play?
Introduced in December 2023, the Bitcoin Elastos Layer 2 (BeL2) protocol significantly enhances Bitcoin’s capabilities by integrating features such as staking and smart contracts directly within the Bitcoin network.
A key focus of the collaboration between BEVM and Elastos’ BeL2 protocol is the development of a BTC Oracle. This Oracle serves as a real-time monitoring and analysis tool for all Bitcoin-related activities.
From supporting staking activities to enabling complex multi-party agreements via smart contracts, the BTC Oracle powered by BeL2 provides crucial insights into the usage dynamics of Bitcoin. This empowers users to effectively manage transactions and relationships using the cryptocurrency.
Elastos utilizes BeL2’s innovative Zero-Knowledge (ZK) proof process to uphold the integrity of Bitcoin transactions. This approach ensures transactions can occur seamlessly without the need for bridging or wrapping, thus preserving Bitcoin’s core functionalities within its native layer.
Elastos and BEVM aim to deliver a genuinely peer-to-peer loan product that avoids network congestion and eliminates unnecessary fees, emphasizing disintermediation and anonymity.
Third-party verification, with its attendant costs and potential delays, would only be required in case of disputes between parties.
Hakan Sezikli, Co-founder of the BEVM Foundation, highlighted the transformative potential of this partnership:
“The BeL2 protocol exemplifies BEVM’s mission of developing and supporting EVM-compatible DApps that can operate within the Ethereum ecosystem on Bitcoin’s Layer 2. The loan offering exemplifies how such services could revolutionize the finance sector.”
US Tech-Savvy Consumers Trust Bitcoin
The partnership coincides with Elastos’ BIT (Bitcoin; Innovation & Trust) Index, highlighting a notable surge in enthusiasm for Bitcoin among tech-savvy consumers in the US.
According to the index, 63% of these consumers express either being “perfectly comfortable” or “excited” about using Bitcoin for transactions. They leverage Bitcoin for diverse purposes, including savings storage and inflation hedging, with more than half of US respondents engaging in monthly Bitcoin transactions.
Furthermore, 24% of respondents place greater trust in Bitcoin than in traditional methods such as online banking or cash for safeguarding their savings. This increasing trust marks a potential milestone in the understanding and adoption of cryptocurrencies among early adopters in the US.
Chen envisions a future where users control their data, breaking free from the dominance of Web 2.0 giants. He emphasized:
“While achieving broader adoption in the US will require ongoing efforts, Elastos remains committed to advancing technologies that streamline interactions and transactions involving Bitcoin.”
As cryptocurrency gains prominence, it has become a significant topic in the upcoming US election, sparking debates within both political and cryptocurrency communities.
