Lorenzo Protocol has partnered with Cetus Protocol, a liquidity protocol and decentralized exchange on the Sui Network.
The strategic partnership will see Lorenzo Protocol integrate its stBTC token on the Sui network through Cetus Protocol. The collaboration aims to bolster Bitcoin liquidity on the Sui Network by encouraging buying, holding, and use of stBTC. Lorenzo Protocol announced the mutual agreement on the X platform today November 26, 2024.
Bring Bitcoin access to the Sui ecosystem
The partnership will enable BTC holders on the Sui network to stake Bitcoin and mint stBTC, Lorenzo’s liquid Bitcoin staking token. The partnership aims to promote Bitcoin user participation on the Sui network. Furthermore, the collaboration intends to encourage BTC users to allow their tokens to work for them by staking Bitcoin and earning incentives in terms of Lorenzo liquid restaking token (stBTC).
The initiative is also part of the effort to expand the decentralized finance ecosystem. The collaboration will see Lorenzo liquid restaking token functioning as a primary financial instrument in the Sui network, allowing users to lend, borrow, and trade Bitcoin products on the network.
Sui, a layer 1 blockchain designed to enable rapid, low-latency transactions, is increasingly becoming a preferred choice for real-time applications like DeFi, gaming, and other responsive services. Sui creators launched the network in 2023, and so far, the blockchain has amassed about $1.4 billion in TVL.
Unlocking Bitcoin’s unexploited potential
While Bitcoin owns the largest market capitalization valued at $1.8 trillion, this market remains a massive untapped potential. For instance, practical applications and yield generation use cases have been relatively limited in the Bitcoin market.
In the past, the only way Bitcoin holders could make money on their holdings was to deposit their funds on CEXs or use avenues that convert their assets into wrapped tokens (like WBTC).
Bitcoin’s limitations in the DeFi landscape restrict holders from engaging in a broad variety of financial activities. This makes it difficult for users to interact with DeFi activities to earn diversified returns, compared to the likes of Ethereum, Solana, etc.
These firms are working to transform the Bitcoin market by allowing the staking of BTC, converting BTC into an income-genertaing instrument.
Ether allows users to stake native tokens and, as a result, earn incentives. Likewise, Bitcoin Layer 2 networks are beginning to allow users to stake Bitcoin to secure transactions and, consequently, earn rewards.