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In a bid to “turbocharge” its services, Bitcoin lending platform Liquidium has forged a partnership with Maestro, an enterprise Bitcoin infrastructure provider. The latter will now be providing Liquidium with its real-time blockchain indexing and mempool monitoring capabilities, resulting in instant insights into Bitcoin’s on-chain activities/events (something that was previously unattainable on the slow Bitcoin network).
Liquidium, Maestro team up to unlock new opportunities in BTCFi
A quick look at the numbers and one can see that the collaboration is already paying major dividends. For starters, LiquidiumWTF, the protocol’s primary lending platform built atop the Bitcoin base layer, has already facilitated loans worth 4,230 BTC (about $500 million) via native assets in collateral. These include Ordinals, Runes, and BRC-20 tokens.
That said, supporting this variety of collateral stands to be challenging, as the platform must continuously track each asset’s metadata as well as any pending Bitcoin transactions that could affect an issued loan.
Maestro’s real-time indexing and mempool awareness mitigate these issues by feeding Liquidium a constant stream of on-chain data, including unconfirmed transactions. As a result, if a borrower’s collateral is moved or a sudden market shift occurs, Liquidium knows immediately and can adjust loan parameters or trigger liquidations without delay.
Similarly, if collateral used in a loan is suddenly sold or moved, the system can spot the transaction the moment it’s broadcast and can act accordingly.
In a recent interview, the company’s core team stated that the use of Maestro shaved months off their development timeline, with project co-founder and CTO Peter Giammanco, further revealing:
We’ve only been using Maestro for two months, but it’s already saved us what amounts to 100% of the time and resources we would’ve spent building our own infrastructure. It’s hard to overstate the speed boost it gave our dev cycle.
Armed with Maestro’s data feeds, Liquidium has rolled out features that are actively pushing Bitcoin DeFi (BTCFi) into new territory. One major innovation has been the ‘Instant Loans’ option on LiquidiumWTF, which, as the name suggests, lets users obtain BTC loans within seconds (on Bitcoin’s L1), that too using assets like Ordinals or Runes as collateral.
Bitcoin loans are now instant and cross-chain compatible
Lenders provide liquidity upfront in on-chain vaults, so when a borrower locks their NFT-like asset, the loan is disbursed immediately (with there being no waiting for a matching lender).
This level of efficiency has been unprecedented for Bitcoin.
Liquidium’s other breakthrough has been its cross-chain lending operations via its LiquidiumFi protocol which enables borrowing and lending across Bitcoin and networks like Ethereum without centralized bridges or wrapped tokens.
It achieves this through the Internet Computer Protocol’s (ICP) Chain Fusion technology, a trustless link between blockchains. In real-world terms, a user can lock native BTC on the Bitcoin network and, in the same flow, borrow an asset like USDT on Ethereum.
The Bitcoin collateral never leaves its chain; as soon as the BTC is locked, Chain Fusion and Maestro’s indexer verify it and trigger the corresponding loan on Ethereum. In other words, this setup allows Bitcoin’s liquidity to spill into the wider crypto economy without sacrificing security or decentralization.
Pioneering a new frontier for BTCFi
Many observers have hailed the Maestro/Liquidium tie-up as a pivotal moment for BTCFi, especially given that Maestro’s infrastructure (which already supports 250+ applications) lies at the backend of the entire operation.
In any case, Liquidium seems to have seized a clear first-mover advantage when it comes to Bitcoin-native lending operations. Importantly, what the firm is doing for Bitcoin draws comparisons to what early DeFi platforms like Aave did on Ethereum, i.e., unlocking liquidity from a previously untapped asset base.
If even a fraction of Bitcoin’s dormant wealth begins flowing into on-chain lending, it could unleash a wave of new liquidity in crypto markets, all while keeping the flagship crypto at its core. Interesting times ahead!
Dan Burgin
Vladislav Sopov
U.Today Editorial Team