Badger DAO is a decentralized autonomous organization (DAO) that enables bitcoin to be used as security for decentralized finance (DeFi) applications.
Over the course of 2020 and the first half of 2021, the estimated number of 1,000 bitcoins – in the form of synthetic derivatives of BTC – used on the Ethereum network exceeded 250,000 bitcoins, a direct result of the skyrocketing the popularity of DeFi. While DeFi first appeared on the Ethereum network, other blockchains like Polkadot and Solana have gained popularity and also serve as the underlying platform for many DeFi projects.
In response to this growing adoption of DeFi, Badger was developed to meet a growing need for Bitcoin in DeFi applications on these different blockchain networks.
Badger's first product, Sett Vaults, allows users to generate income with their synthetic BTC assets. Digg, Badger's second product, is software that manages the DIGG token, an elastic supply cryptocurrency pegged to the dollar price of bitcoin.
BADGER is an Ethereum-based token used for protocol management and reward distribution within the Badger DAO. Although BADGER originally only allowed its holders to vote on project proposals, it has since grown in utility and is now used to distribute rewards to those who manage Sett Vaults.
See the Badger DAO news – section to keep up to date with new developments.
Badger was founded in September 2020 by Chris Spadafora, Ameer Rosic, Albert Castellana and Alberto Cevallos. To set up its DAO infrastructure, the Badger team collaborated with dOrg, a company specializing in the development of DAO-related software.
Among others, Spadafora is the creator of the Crypto COVID19 Charity Poker Tournament, Rosic is a serial entrepreneur and co-founder of Blockgeeks.com and Castellana is co-founder of StakeHound. Spadafora and Rosic are currently part of Badger's operations team, while Castellana and Cevallos have advisory roles on the project.
Badger works primarily as a DAO. Anyone with their governance token, BADGER, has the opportunity to vote on proposals from community members. The more BADGER a user has, the more voting rights they have, and proposals that get enough votes from the community are implemented on their platform.
Badger has integrated several DeFi products into its platform in order to make bitcoin an asset usable across blockchains. The development team has partnered with other DeFi projects such as Yearn, Ren, and Curve to bring these products to life.
SETTINGS
SETTs, also called Sett Vaults, are token pools in which users can lock their tokenized bitcoins and allow smart contracts to manage their stocks in order to obtain a return on their investment. In other words, SETTs are Badger's version of an automated DeFi aggregator.
When users deposit tokens into a SETT, they receive bTokens in return. For example, when users deposit BADGER into a Sett Vault, they receive bBADGER in return. These bTokens are interest-bearing tokens that represent the user's share of assets in SETT and can be used as collateral in different DeFi applications. Anyone who contributes to a SETT receives, together with BADGER tokens, the income paid into the corresponding token (based on the parameters defined in that particular SETT). The BTokens can then be exchanged for the original asset, with all proceeds (minus a fee).
DIGG
DIGG is a decentralized “Elastic-Supply” cryptocurrency linked to the price of bitcoin.
Digg's software adjusts the supply of its DIGG cryptocurrency in a programmatic manner through smart contracts that increase or decrease the circulating DIGG supply in response to fluctuations in the price of bitcoin.
When the demand for DIGG is high, the price of each token can exceed the price of one BTC, so the Digg protocol automatically increases the supply of DIGG to readjust its price to the market price of BTC. When demand is low, the Digg protocol automatically reduces the supply of DIGG to achieve the opposite effect. The process of scheduled supply adjustment to change the price of an asset is called “rebasing” and applies to all wallets containing DIGG tokens.
While the supply of DIGG constantly changes “elastically”, a token holder's share of the total supply of DIGG remains stable. In other words, if you held 1% of all DIGG tokens before a rebasing event, you would still hold the same percentage of tokens after the rebasing.
DIGG can be used like any other token in DeFi protocols and can also be deposited into SETTs to generate income for its holders.
Why is BADGER valuable?
As with other cryptocurrencies, the value of BADGER is linked to both its tokenomics and its usefulness within the Badger platform.
BADGER was originally designed as a governance token of the Badger DAO ecosystem and has since been expanded to provide more functionality within the Badger ecosystem. These include voting rights, participations in the Sett Vault provided for this purpose and rewards for providing liquidity in the WBTC BADGER pools.
BADGER's total supply mirrors that of Bitcoin, meaning there will still only be 21 million BADGER tokens under the software's rules. Once the entire supply of BADGER is in circulation, no further tokens can be minted.
Why use BADGER?
Badger DAO helped the world's first cryptocurrency become a functioning part of the DeFi world. Crypto enthusiasts and casual investors can find equal value in Badger's goal of making the Bitcoin-DeFi ecosystem as rich and complete as possible.
Badger has made its solutions viable and organized a DAO structure conducive to a collaborative and active community that seeks to continually improve its products.
Users who wish to join and participate in the Badger community may wish to acquire BADGER for system management purposes. Those interested in taking advantage of Badger's many DeFi offerings may wish to own BADGER as collateral and use it in income strategies.