Zest Protocol-Earning Bitcoin is Easier With Zest

Zest Protocol

Through its lending pools, Zest Protocol aims to give liquidity providers with access to a stable Bitcoin income.

Zest is an on-chain Bitcoin capital market for institutional borrowers. It enables on-chain financing without the risk of liquidation.

Bitcoin is not a passive asset; it requires active participation from its community in order to realise its full potential and increase in value. For a long time, earning a passive income using Bitcoin was difficult.

Now, there are a slew of new tools on the market. That is precisely what the blockchain’s paradigm shift is all about: shifting power away from the major actors and distributing it to the people.

Earning Bitcoin Is Easier With Zest

The Zest pools are managed by a decentralized club of delegates, who whitelist borrowers and receive performance fees.

The Mission

• To assist establish a more stable Bitcoin economy by strengthening it.
• To gain access to a market worth $120 trillion.
• A wallet full of Bitcoin is utterly useless. All of that is about to change with the introduction of Zest.

A Little Background

• Following WWII, the Bretton Woods Treaty established a gold-based global economy.
• That was fine as well. For a while, gold served as the basis for value.
• However, circumstances have changed, and inventive income opportunities abound.

 Meet Zest Protocol 

Zest is on-chain Bitcoin capital markets. Undercollateralised bitcoin liquidity for institutional borrowers, zesty yields for individual Bitcoin lenders.

We’re bringing the $120 trillion bond market on-chain. Zesty.

— tycho.btc  (@TychoOnnasch) February 17, 2022

Making Passive Income with Bitcoin

It only takes a few actions to turn a dormant Bitcoin into a productive one.

Celcius and BlockFi, for example, are fantastic centralised yield products. However, due to regulatory restrictions, not everyone can have easy access to them.

Wrapped BTC, on the other hand, provides opportunities from other L1s by confirming, wrapping, and unwrapping on their platforms, which introduces new trust assumptions.

Zest has the world’s most secure decentralised network. You don’t want to miss out on that opportunity.

The Ecosystem of Zest (Zest Protocol)

The Zest ecosystem brings together liquidity providers, pool delegates, borrowers, and stakers. How it works is as follows:

1. Liquidity Providers

Everyday users that deposit Bitcoin into a liquidity pool is known as liquidity providers. They plan to fund loans and earn a profit (now, APYs are roughly about 3-5 percent for unsecured Bitcoin).

2. Pool Delegates

Pool Delegates are in charge of overseeing the liquidity pools. Off-chain, pool delegates look for agreements with borrowers and do due diligence.

They add borrowers to a pool after researching and authorizing them so that liquidity suppliers can consider completing their loan applications. A pool delegate is rewarded as well, as they share in the interest payments.

3. Borrowers

Borrowers are people that apply for funds from liquidity providers after being accepted into a pool by their pool delegate.

To receive funds, they must create a vault and submit a Bitcoin address. If the pool delegate deems it essential, the vault can keep collateral deposits.

4. Stakers

Stakers As a sort of security, each liquidity pool is linked to a parallel staking pool. That is if any of the debtors fall behind on their payments.

Pool delegates stake in their own pools, but anyone can join in on the action by staking alongside the pool delegate to increase earnings.

5. The Protocol Treasury 

Treasury of Protocols Bitcoin revenues are stored in native BTC here, and it serves as a back-up plan in the event of a sudden shortfall.

Last but not least, there are the Zest token holders, who have the ability to vote on general protocol improvements as well as on onboarding pool delegates.

In the Protocol Treasury, Zest tokens are produced in proportion to the Bitcoin input.

The fact that the higher the Zest token trades versus Bitcoin, the lesser its issuance is essential for token holders.

All of this results in a free market for credit evaluation. A pool delegate is someone who has an advantage in evaluating someone’s credit.

A Well Thought Out System

Obviously, the first pool of delegates will lend to institutional borrowers they know and trust.

However, based on data from borrowers’ on-chain accounts, this safeguard may change. Improving the ability of the pool delegates to find good borrowers.

Sharpening your intuition is also good for your brain. There are no restrictions, everyone can participate, and the profits might be substantial.

Stacks Network (Zest Protocol)

Borrowers and liquidity providers can join using only their Bitcoin wallet addresses. Stakers and pool delegates, on the other hand, must use the Stacks platform.

On the Stacks network, Zest employs Clarity Smart Contracts.

In the event of debtors’ payment delays, these Clarity smart contracts can activate the Zest protocol and liquidate collateral or staked funds.

Furthermore, Zest employs Taproot-enabled Discrete Log Contracts (DLCs) to improve the transparency and trustworthiness of BTC guarantee deposits in pools.

When it comes to trust, the four primary trust assumptions that a Zest user makes are as follows:

1. Belief in Bitcoin’s blockchain.
2. Have faith in the Stacks’ Clarity smart contracts to accurately read and analyse the liquidity pools, staking pools, and collateral funds, and to make the appropriate actions to mitigate any mishaps.
3. Belief in the audited Smart contract of the Zest protocol.
4. The user’s choice of pool delegate was based on their performance. Users can see all of a pool delegate’s online activities (yields, prior loans, defaults, and so on), which encourages healthy competition.

The global bond market, which allows governments, colleges, organisations, and public enterprises to borrow money from private investors, is currently valued almost $120 trillion.

It’s no secret that this massive budget is making the switch to Bitcoin. Zest is poised to take the lead in this paradigm shift and is in the driver’s seat.

Lenders will also receive tokenized loan receipts from the corporation. The resulting fixed-income Bitcoin bonds will be tradable on secondary markets in this way.

Bitcoin bonds offered by Zest can be traded in a variety of ways.

Capital access will be democratised thanks to on-chain capital markets. Anyone with a competitive edge in credit evaluation can become a pool delegate and bring together profit-hungry borrowers.

Loads of Potential (Zest Protocol)

Zest would initially lend money to OTC (over-the-counter) desks, exchanges, market makers, and arbitrage traders. Today’s biggest Bitcoin debtors.

This isn’t some esoteric concept. Only in Q4 2021, Genesis generated $13 billion in Bitcoin loans.

Maple Finance, which pioneered undercollateralized USDC lending on Ethereum, has just been on the main-net for eight months and has already issued $ 610 million.

Zest is working hard today to launch their testnet before the end of Q1 2022. They expect to be ready for full launch by Q2 2022, following various audits and stress tests.

Change is accelerating, and technology revolutions are becoming more powerful. Cryptos will become more popular as new avenues to profit become available, particularly among institutional investors.

The new tools are returning power to the people, and on-chain capital markets will undoubtedly play a role in democratising capital and financial access.

Passive investments will always provide prospects for revenue generating. While passive income from Bitcoin has taken longer than on other sites, Zest is making it happen.

The input that Stacks’ Clarity Smart Contracts provide to Zest will improve the experience’s security and profitability. This is one you don’t want to miss!

Zest Protocol

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