DeFi protocol BadgerDAO launches CLAWS stablecoin

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New DeFi product: DeFi protocol BadgerDAO launches CLAWS stablecoin

Bitcoin-centric decentralised financial protocol BadgerDAO will launch a stablecoin called CLAWS.

In an announcement on 22 February, the DeFi protocol explains what its new offering will do and why the crypto space needs another stablecoin. CLAWS is a „yield dollar“ similar to those offered by the UMA protocol.

The concept of a yield dollar is that the collateralised Bitcoin System asset has an expiry date – and the closer it gets to the date, the closer it is to its peg. These are minted when a user provides collateral, and Badger will allow two types.

To mint the two types of CLAWS tokens, liquidity providers can use bBadger and wBTC/ETH liquidity pool tokens. For each type of CLAWS, there should be a subset of tokens with a variety of expiry dates.

Using CLAWS for DeFi

The blog post explains that the CLAWS token offering will be created by users taking advantage of additional return opportunities by creating collateralised debt positions (CDPs). They can also be purchased – but prices will vary depending on how much time is left until expiry.

It seems that the primary purpose of the token is to generate more yield-farming incentives through SushiSwap pools:

„Once a user mints CLAWS tokens, they can deposit their CLAWS into a Sushiswap liquidity pool and receive CLAWS-SLP tokens in return. These CLAWS SLP tokens can then be used in a special Badger Sett vault to earn additional rewards.“

Badger’s flagship product is the Sett Vault, where users can deposit different types of tokenised bitcoin (Go to Buy Bitcoins by Instant Transfer Guide), such as wBTC, renBTC or tBTC, to generate automatic returns.

The blog post concludes:

„CLAWS Sett vaults will change the yield farming game by providing a stable asset with multiple income streams. Such a profitable base makes CLAWS an important native asset in the ever-evolving DeFi space.“

Earlier this month, BadgerDAO partnered with Yearn Finance to create more DeFi earning opportunities based on Bitcoin (Are BTC whales dumping their coins now?).

The protocol includes native tokens BADGER and DIGG. BADGER prices have fallen 15% in the last 24 hours, back to $55 (time of this writing). The token reached an all-time high of $84 on 9 February.