Kava Labs, developer of the non-Ethereum based DeFi platform Kava, has announced a Mainnet upgrade that will enable users and institutions to earn massive staking rewards with Bitcoin.
What Happened: Kava’s Version 5 upgrade will add the crypto borrowing function and the opportunity to earn interest and take out loans against multiple crypto assets.
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The new update will reportedly enable institutions to earn up to 45% APR on their Bitcoin holdings without counterparty risk.
“Assuming companies like Tesla want to put their BTC to work, they can do so through Kava and HARD Protocol,” said Kava Labs in a press release shared with Benzinga.
HARD Protocol is a decentralized money market built on the Kava platform that enables lending and borrowing of cross-chain assets.
“As Tesla owns $1.5 billion worth of Bitcoin - or an estimated 48,000 BTC - they can earn up to 21,600 BTC with a 12-month lock-up period,” stated the DeFi platform.
Why It Matters: The total value locked in decentralized finance or DeFi protocols recently crossed a new milestone of $50 billion. However, Bitcoin’s role in DeFi so far has remained minimal, as few protocols support it in its native form.
According to Kava Labs CEO Brian Kerr, “As more enterprises and financial institutions adopt bitcoin and cryptocurrencies, the more valuable the Kava DeFi platform will become as it enables this new wave of financially minded users with a way to finally put their assets to work and make Bitcoin and other cryptos into a cash-flowing asset on their balance sheets.”
What Else: Kava’s platform has three types of tokens - the KAVA token, which is the Kava blockchain’s native cryptocurrency, the USDX token, which is the platform’s stablecoin used in collateralizing crypto assets, and the HARD token, which is the native token of the HARD money market platform.
Price Action: At the time of writing, KAVA was up 13.26%, trading at $7.65, while HARD was trading at $2.27.