Satoshi Protocol, a decentralized collateral debt position (CDP) project, saw its total value locked (TVL) soar by over 1,000% in the past month to break above $20 million, according to data from DefiLlama.
On Monday, December 9, the protocol’s TVL reached a record $22.3 million, which represents a tenfold increase from about $2 million at the beginning of the month.
Satoshi Protocol is a CDP project issuing a Bitcoin-backed stablecoin called satUSD. It uses a MakerDAO-like model to unlock Bitcoin liquidity.
The stablecoin is available on multiple Bitcoin-related layer 2 chains, including BSquared, BOB, BEVM, and Bitlayer.
The recent surge is attributed to the integration of BSquared, which currently accounts for 90% of the total TVL.
satUSD maintains its peg through over-collateralization, an instant liquidation module, and a peg mechanism. If satUSD falls below the $1 target, arbitragers can buy and redeem it for $1 worth of BTC from the protocol.
The protocol enables users to deposit collateral at a 110% collateralization ratio to mint satUSD. Currently, the most deposited token is uBTC, which represents Bitcoin staked through BSquared.
On December 6, the protocol saw record inflows in USD terms, when nearly $10 worth of crypto was deposited as collateral.
Currently, satUSD’s market cap is $1.6 million, which puts the collateral ratio at nearly 1,400%.
In July 2024, the Satoshi Protocol raised $2 million in its Seed round led by CMS Holdings and RockTree Capital and joined by Cypher Capital, Optic Capital, Side Door Ventures, Metalpha, Outliers Fund, and Comma3 ventures.
Satoshi Protocol’s founder CEO, Naka, said at the time:
“The support from our investors is crucial as we work towards creating a universal stablecoin that meets the needs of Bitcoin users. This funding will help us achieve our development and market goals.”
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