Today, we published an ARFC on the
@aave governance forum to propose native Bitcoin to Aave V4 as collateral through Babylon Trustless Bitcoin Vaults (TBV).
The proposal includes two new Aave V4 Spokes; Babylon Spoke and BTCVault Swap Spoke for borrowing and liquidation settlement, revenue sharing terms and AAVE, BABY buybacks.
If approved and implemented, Bitcoin holders can lock their native Bitcoin on the Bitcoin chain self-custodially, and use it as collateral to borrow supported assets on Aave V4, without wrapping, bridging, tri-party escrow, or sending their Bitcoin to third parties.
Risk parameters for both Spokes will be provided by Aave's risk service providers.
Subject to Aave governance review and approval.
governance.aave.com/t/arfc-o…