New to DeFi?
Maybe you have some Bitcoin in cold storage or on Coinbase and you’re curious what this DeFi thing is all about… You're in the right place!
This page has everything you need to get started earning DeFi yields on your Bitcoin with BadgerDAO. It assumes you've never interacted with the world of decentralized finance before.
Bitcoin is a digital asset stored on the Bitcoin blockchain.
BadgerDAO is a decentralized finance (DeFi) application built on Ethereum smart contracts.
Until recently, the Bitcoin and Ethereum blockchains operated separately.
This meant that (despite holding a revolutionary, world-changing asset) Bitcoin users were shut out from the main benefits that DeFi has to offer, which are:
- Earning yield, usually much higher than those available in traditional finance; while
- Maintaining control of your private keys so you stay fully in charge of your assets
Where do these amazing yields in DeFi come from? There are three main areas:
Yield Farming: New DeFi startups are constantly launching. Many of them provide tokens as a reward for depositing assets into their protocols, known as "yield farming."
Lending: Like traditional finance, you can earn interest by supplying assets to be lent. These loans are typically secured by an amount larger than the loan and will be automatically paid back if the collateral value drops, making them extremely safe for the lender.
Providing Liquidity: You can supply assets to markets that let users swap between tokens. In exchange, users receive a portion of the trading fees.
The landscape of these opportunities is constantly changing – and this is where BadgerDAO comes in.
We provide tools that allow you to bring your Bitcoin into DeFi and earn the best risk-adjusted yield possible, automatically rebalancing into better strategies as they become available.
With BadgerDAO, you can rest easy knowing you never have to give up the private keys for your crypto, you can withdraw anytime you like, and our strategists are working day and night to put your assets to work.
Before You Start
Before starting with BadgerDAO, you need to get setup to interact with both the Bitcoin and Ethereum blockchains.
If your assets are on a custodial exchange like Coinbase or Binance, you will need to move them off exchange and into your private wallet before you interact with BadgerDAO or any other DeFi protocol.
This is because BadgerDAO is non-custodial, meaning you maintain full control over your private keys at all times, and decentralized, meaning that our protocol is secured by the network of over 10,000 Ethereum nodes located all around the world, rather than a single point of failure.
Self-custodying your crypto can be daunting, but please take your time to familiarize yourself with how to send transactions and secure your private keys. If you have any questions, you can always ask in our Discord here (it is monitored 24/7 by support team members).
You will need:
- A Bitcoin wallet and some Bitcoin (the assets you plan to deposit in BadgerDAO)
- An Ethereum wallet and some ETH (to pay transaction fees on Ethereum)
- A hardware wallet such as a Ledger or Trezor (strongly recommended for security)
- A Web3 browser extension like MetaMask (connects the Badger app to the Ethereum blockchain and lets you approve transactions)
- A basic understanding of crypto security best practices
Bridge Your BTC into Badger
Badger Vaults offers over a dozen automated strategies to earn yield on Bitcoin-pegged assets, for example wrapped Bitcoin (wBTC) or Badger's own Interest Bearing Bitcoin (ibBTC).
Normally, depositing into these requires several different transactions.
The good news is, by using Badger Bridge, you can "zap" from BTC directly into four of our top performing Vaults using a single interface.
Once your assets are in a Vault, they start earning automatically. Some of the rewards are auto-deposited back into your balance, while others need to be claimed via another transaction.
With BadgerDAO, there is no lockup period which means you can withdraw your assets at any time.
Below, we're going to walk you through how to go from Bitcoin into our bCRVrenBTC vault, which is currently yielding 8.6% APY, but can be boosted to over 125% (see "Boost" below for details).
Ready? Let's go:
Step 1: Visit https://app.badger.com/bridge
Step 2: Connect MetaMask
Step 3: Click "Mint & Earn" and input the amount of BTC you would like to deposit.
Select the "bCRVrenBTC" vault from the dropdown menu and click "Next."
Keep in mind:
- The minimum is .03 BTC.
- The Ethereum and Bitcoin networks charge fees for transactions. These rise and fall based on market conditions, but $100-150 is a normal range. These fees may not make it economical to deposit small amounts.
Step 4: Confirm Fees
You will see a confirmation page that estimates all the fees associated with the transaction.
Keep in mind that Ethereum fees vary due to network congestion. If the fees are higher than expected, you can try at a different time (weekends are usually lower)
After reviewing the information, click "Confirm" to proceed.
Step 5: Deposit your BTC to the Bridge
Send funds from your Bitcoin wallet to the address displayed in blue (or use the QR code if on a mobile wallet).
Once you send your BTC transaction, you can track it through the network as it confirms.
Important: For security reasons, you must wait for the Bitcoin network to register six confirmations before proceeding. This may take an hour or two so don't panic and keep the window open to track your progress.
Step 6: Submit to Ethereum
After your Bitcoin transaction has six confirmations, you will see a prompt to send your funds to Ethereum.
This will require some ETH in your Ethereum wallet for transaction costs. So make sure your wallet is not empty or you will get an "insufficient funds" error.
After you click "Submit to Ethereum" you will be prompted to approve the transaction in MetaMask and your hardware wallet (if using one).
Once this transaction finalizes, congratulations!
Step 7: Track & Claim Rewards
The BadgerDAO app makes it easy to track the status of your assets and rewards.
To see your balances, click the "Portfolio View" toggle switch on app.badger.com.
Some rewards in the bCRVrenBTC vault are auto-compounding, meaning they are added to your underlying balance automatically.
Others, however, you will need to claim using another Ethereum transaction.
As your vault position accrues rewards, they will be visible in the upper right corner of the app.
To claim, just click "Claim Rewards" and a dialogue box will pop up allowing you to perform a transaction to sweep the rewards into your wallet.
Some of these rewards, like BADGER governance token and CVX can be re-deposited into other Vaults to compound further.
Questions about any of this?
Head over to our Discord community where you will find a team of friendly Badgers happy to help.
How To Boost Your Yield
At this point, you may have noticed that the ROI for Vaults are shown as a range and wondered how you can get these sweet yields yourself...
Enter something we call Badger Boost.
Boost delivers extra rewards to users of our Vaults that hold native Badger assets, which are:
- BADGER, the governance token of BadgerDAO; and
- DIGG, a rebasing token that tracks the price of Bitcoin.
Simply put, the more BADGER and DIGG you hold in your wallet, the more BADGER rewards you get in the Vault.
This happens on a sliding scale, and we've created a calculator called Boost Optimizer that will tell you exactly how much BADGER or DIGG you need to maximize your rewards.
Here's how it works:
1. Visit app.badger.com and connect your wallet
2. Click the Boost dropdown and select Boost Optimizer
3. View your current Boost
The Boost Calculator shows the balances in your wallet, and calculates your Boost Multiplier by comparing the amount of native assets you hold (BADGER and DIGG) to the non-Badger assets.
The color code corresponds to your current Boost level, spanning from Basic Badger (orange) to Frenzy Badger (red).
A text box will appear in the app to show you how much BADGER or DIGG is required to reach the next tier of rewards.
4. Purchase Native Assets
Say you'd like to purchase some extra BADGER tokens to boost your yield.
To do this, you will need to have some ETH (or other Ethereum tokens) in your Ethereum wallet.
Click here to trade Badger on Sushiswap, once there you can input the desired numbers of tokens to buy, connect your wallet using MetaMask, and approve the transaction as normal.
If you have not traded these assets on Sushiswap before, you will need to perform two transactions: one to approve the token for spending, and a second for the swap.
Once the transactions confirm, the BADGER tokens will display in your Boost Optimizer.
Once your new tokens are in your wallet, BadgerDAO will automatically detect the new native tokens and adjust your Vault yield accordingly.
Congratulations! You are now Boosted.