Toronto-based digital asset company DeFi Technologies plans to launch a validator node on Core Chain and stake nearly $100 million in Bitcoin (BTC).
DeFi Technologies, through its subsidiary Valour, will not only validate transactions but also receive staking rewards for participation, the company said in a press release on Tuesday.
The staking process will be facilitated by Core Chain’s Ethereum Virtual Machine compatible consensus mechanism on a BTC-powered Layer 1 blockchain.
“By staking 1,498 BTC and participating in network consensus, we are advancing our mission to bridge traditional finance with innovative blockchain technology,” Olivier Roussy Newton, the CEO of DeFi Technologies, said.
“This approach offers investors a unique opportunity to participate in the revenue and growth of the digital asset sector.”
Stakers will be rewarded in CORE tokens
During the lockup period, stakers will store their BTC holdings and receive rewards in the form of CORE tokens which will be reinvested in the product.
Staked CORE tokens provide a reward of 11.66%.
To ensure transaction and blockchain security, 50% of BTC mining hash power is distributed to Core Chain.
Currently, Core Chain has staked over 2,800 BTC excluding upcoming DeFi technology deployments.
This collaboration represents the second step in the partnership between the two organizations.
On May 10, they jointly launched the Valor Bitcoin staking exchange-traded product (ETP) on the Nordic Growth Markets exchange, based on the Swedish Krona. Currency offered.
Touted as the first income-generating BTC ETP, the Valor ETP offers BTC exposure with a 5.65% yield and a 1.9% management fee.
Additionally, the partners plan to launch a core ETP that will offer income through BTC staking.
Valour already offers ETPs backed by other coins such as Uniswap and Polkadot, as well as a 10-coin basket called Bitcoin Carbon Neutral (BTCN) and the STOXX Bitcoin Swiss Digital Asset Blue Chip X Index.
Some of these offerings do not have management fees.
DeFi Technologies Increases Focus on Bitcoin
DeFi Technologies’ validator node launch coincides with the company’s recent shift to increase its focus on BTC.
A few days ago, the company announced that it had adopted BTC as its primary reserve asset as part of its new strategy, purchasing 110 BTC.
The announcement led to a massive 23% increase in DeFi Technologies’ stock price.
As of May 31, DeFi Technologies had $51 million in cash on hand and Valor had $607 million in assets under management (AUM).
This represents significant growth for Valor, as it had $274 million in assets under management as of mid-March 2022.
In the past two months, several companies, including US healthcare company Semler Scientific and Japanese investment firm MetaPlanet, alongside the notorious MicroStrategy, have decided to adopt Bitcoin as the primary means of storing excess funds.
Both MetaPlanet and Semler have indicated a willingness to use the capital markets to raise funds to purchase more BTC, rather than relying solely on corporate profits.
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