BitVault, a pioneering DeFi protocol offering Bitcoin-backed financial infrastructure, has raised $2 million in a pre-seed funding round led by prominent investors including GSR, Gemini, Auros, and Keyrock.
This strategic investment will support the launch of bvUSD, a stablecoin backed entirely by Bitcoin derivatives, and its yield-generating counterpart, sbvUSD, which is powered by advanced trading strategies executed by GSR. With this innovation, BitVault aims to offer a secure, scalable, and institutionally aligned alternative to traditional fiat-backed stablecoins like USDC or algorithmic options like USDe.
Commenting on the project, Michael Kisselgof, a Core Contributor at BitVault and VaultCraft, stated:
“Bitcoin was built for moments of fracture. BitVault was built to make it usable. We specifically onboarded GSR, Auros, and Keyrock as strategic investors that can also execute high-yielding, non-directional strategies to create demand and deep liquidity for BTC-backed money.”
Bridging Bitcoin and DeFi
BitVault aims to redefine Bitcoin’s role in decentralized finance by offering a secure, scalable, and institutionally aligned alternative to traditional fiat-backed stablecoins like USDC or algorithmic models like USDe. Unlike these stablecoins, bvUSD is transparently collateralized by Bitcoin derivatives, enabling a more decentralized and resilient form of crypto-native money.
To mitigate systemic risk, only whitelisted institutional borrowers can mint bvUSD in large volumes, while retail users can mint smaller amounts using existing stablecoins. Staked bvUSD converts to sbvUSD, which generates yield through delta-neutral and arbitrage trading strategies managed by GSR, one of the most respected names in institutional crypto trading.
Launching on Katana: A DeFi-Centric Chain
BitVault will function as a core stablecoin protocol on Katana, a new DeFi-first blockchain incubated by Polygon Labs and GSR. Katana is designed to emphasize deep liquidity, high yields, and user incentives, making it the perfect platform for BitVault’s innovative stablecoin infrastructure.
The deployment is based on a licensed version of Liquity V2, which has been redesigned to meet institutional-grade standards. BitVault retains key DeFi features such as direct redemption, permissionless access, and composable yield, while introducing governance-free mechanisms and a permissioned borrowing layer for enhanced security and scalability.
Infrastructure, Governance, and Ecosystem Expansion
BitVault’s ecosystem will be governed and incentivized through the upcoming VCRAFT token, which will serve dual roles: governance over protocol parameters and rewards for liquidity providers and stability participants.
Initial integrations on Katana include:
- VaultCraft infrastructure
- Morpho money markets
- Sushi decentralized exchanges
- A cross-chain “Bits” loyalty campaign linked to VCRAFT distribution
These partnerships are expected to catalyze adoption and expand use cases for both bvUSD and sbvUSD within the broader DeFi ecosystem.
BitVault’s emergence comes at a time of surging interest in stable, censorship-resistant digital assets. Unlike fiat-backed options or volatile algorithmic designs, BitVault’s Bitcoin-collateralized model avoids over-leveraged and anonymous borrowing, offering a more secure and sustainable alternative.
With mainnet deployment planned for June 2025, BitVault is poised to become a cornerstone of the DeFi landscape. The team has outlined plans to expand the stablecoin suite to include additional BTC-based collateral assets and onboard more institutional borrowers to support growth and liquidity.
About BitVault
BitVault is a next-generation DeFi protocol offering capital-efficient, Bitcoin-backed stablecoins designed for institutional alignment and decentralized usability. Through its dual-token model, bvUSD for stability and sbvUSD for yield, BitVault bridges the gap between Bitcoin and DeFi, powered by trusted infrastructure, permissioned lending, and composable yield mechanisms.
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