News ยท DeFi
Alexander Blume argues token-incentivized Bitcoin yields dilute as deposits expand, defending offchain institutional credit models.
Key point 1 of 3
01
Two Prime CEO Alexander Blume characterized Bitcoin staking yields on Babylon and Stacks as venture-funded subsidies that decline as deposits scale.
Key point 2 of 3
02
Babylon reported approximately 40,800 BTC ($3.28 billion) in total staked assets as of Nov. 4, paying staking rewards via BABY token inflation at 5.5% annually.
Key point 3 of 3
03
Two Prime deployed an offchain private credit vault on Pareto in September, generating yields from evaluated commercial borrowers rather than token budgets.
Context
Bitcoin staking and layer-2 ecosystems have scaled rapidly to offer holders yield beyond passive spot exposure.
Why it matters
Bitcoin yield depositors, protocol treasuries, and DeFi lenders face ongoing calibration of risk and return.
What to watch
The conclusion of the Stacks Stack Sats distribution program on Dec. 10, alongside subsequent total value locked flows across Babylon and Pareto credit vaults.
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