The DeFi ecosystem has been plagued by hacks and exploits, with the recent KelpDAO incident being one of the latest examples. However, a new development in Bitcoin yield generation may offer a safer alternative to the traditional custodial model.
Lightning Network's routing model allows for native BTC/USDT swaps, providing a new source of yield without relying on complex DeFi protocols. This is made possible by Tether's decision to issue USDT natively on Lightning via RGB, enabling native BTC/USDT swaps on Bitcoin.
The integration with Utexo brings Bitcoin yield back to where it belongs, and Solv Protocol is already actively using this new model. With over $2B in Bitcoin reserves, Solv deploys BTC into Lightning channels, earning routing fees in BTC through native USDT/BTC swaps.