Babylon Proposes Native Bitcoin Collateral for Aave V4
Babylon’s proposal would keep bitcoin collateral on its native network while using WBTC for permissionless liquidations, with risk settings and governance votes still pending.
Babylon is advancing a proposal to support native bitcoin collateral on Aave V4, according to The Defiant. The plan would leave the collateral on the Bitcoin network.
Under the proposed structure, WBTC would be used to settle permissionless liquidations. This separates where collateral is held from the asset used in the liquidation process.
Risk parameters have yet to be determined, and additional governance votes remain pending. The proposal is therefore not a finalized arrangement.
Source: The Defiant
