Bima Labs Joins the Stablecoin Race with Its Bitcoin-Backed USBD

Quick take:

• Ryan Fang of Ankr, Brian Crain of Chorus One, Jeffrey Feng of Sei Labs and Smokey of Berachain also joined as angel investors.
• The fundraising was structured as equity with token warrants, founder and CEO Siddarth Sridhar told The Block.
• The USBD stablecoin is minted by Bitcoin liquid staking and restaking tokens as collateral.

Bima Labs has emerged from stealth with a $2.5 million funding round led by Portal Ventures. The seed round also attracted participation from Draper Goren Blockchain, Sats Ventures, Luxor Technology, CoreDAO and Halo Capital, with Ankr’s Ryan Fang, Brian Crain of Chorus One, Jeffrey Feng from Sei Labs, and Smokey of Berachain joining as angel investors.

The fundraising was executed as equity with token warrants, Bima Labs founder and CEO Siddarth Sridhar told The Block.

Bima Labs offers the USDD, a stablecoin backed with Bitcoin, which can be minted by Bitcoin liquid staking and restaking tokens as collateral. The project has plans to accept collateral from multiple chains, including Bitcoin, Bitcoin L2s, Ethereum, EVM-compatible networks, and Solana.

“Users can deposit their Bitcoin liquid staking tokens (LSTs) and liquid restaking tokens (LRTs) from a wide variety of providers to mint USBD from Lorenzo, Lombard, pStake, Bedrock, Acre, DLC.link, ALEX Labs BTC, and more,” Sridhar said.

Once users mint USBD, they can use it for lending, borrowing and swapping, among other use cases. “We envision a world of new credit, debt and hybrid use cases powered by USBD, whether you’re in China, the U.S., Brazil or Europe,” Sridhar added.

This announcement comes at a time when Bitcoin is emerging fast as a major dApp ecosystem, driven by the rising demand for crypto staking and restaking protocols and now stablecoins.

“Whatever was accomplished on Ethereum within 4-5 years is being done on Bitcoin within a span of 4-5 months,” Sridhar said. The Bitcoin ecosystem has a higher total addressable market, more asset utilization in places like Latin America and the Middle East and North Africa, and ultimately more potential to unlock higher yield opportunities.”

Currently in testnet, USBD is planned for a mainnet launch in the fourth quarter of 2024. The project also plans to launch its governance token BIMA before the end of the year, according to Sridhar. 

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