Using Native Bitcoin as Collateral in Aave @babylonlabs_io will build a Bitcoin-only Spoke node on Aave V4, allowing users to use native Bitcoin as collateral for the first time. Users use the Babylon Bitcoin Vault to lock their real Bitcoin at the Bitcoin L1 layer. The Vault generates verifiable proofs that the Bitcoin has been securely locked. ⤷ @aave V4 accepts this proof, allowing users to borrow stablecoins or other assets using their Bitcoin. Trustless Bitcoin staking has activated over $6 billion of native Bitcoin and partners with top finality providers such as @Lombard_finance and @SolvProtocol. ⤷ Trustless Bitcoin Vault extends this functionality to the broader $1.7 trillion Bitcoin market. For Bitcoin holders: ➞ Transform “dormant” Bitcoin into productive capital ➞ Earn yield and borrow liquidity while retaining ownership. For DeFi: ➞ Unlock massive new liquidity pools. Babylon already holds over 50,000 bitcoins, which Aave V4 can now use as high-quality collateral. This opens up a huge new market: Bitcoin-backed loans worth hundreds of billions of dollars.