FAQs
1. What’s the advantage of the Yala solution compared to conventional bridging with wBTC?
Wrapped tokens are centrally bridged assets whereas Yala commits to offering a decentralized approach
Yala USD is a UTXO type of asset that sits at the same level of consensus as that of Bitcoin, inheriting its security
Yala Finance supports any UTXO-type of assets, including BRC20, BRC420, ARC, and RUNE.
The modular infrastructure provided by the Yala protocol allows assets to interact across different ecosystems without relying on bridges, offering a completely decentralized and trustless experience.
2. How much time would it take to either collateralize assets or stake on different DeFi protocols across ecosystems?
Staking and minting are UTXO transactions so the time is the BTC block time, so 10 minutes. However, generating stablecoins and various calculations depend on the target VM chain's block time, so it's quite fast. For example, if a user completes a transaction to deposit BTC and receive Yala stablecoin YU balance, they must wait for one BTC block time plus one ETH block time. This YU balance is communicated to the whitelist module by the indexer, then to Yala, indicating its available balance data, rather than being withdrawn to the blockchain. If he wants to use these YU for operations in other modules, he doesn't need to conduct another UTXO transaction on the BTC blockchain. Instead, the YU balance data can be directly mapped from the YU whitelist module to other modules, so it's very fast.
3. How are assets secured once the users staked on Yala?
UTXO-type of assets are natively stored in the Black module, whereas Bitcoin are stored using the MPC solution provided by our partner Fireblocks.
4. Could anyone potentially hack the White module?
No, the White module would only mint assets after receiving the approval from the indexer. Moreover, because of the nature of the UTXO type asset, every new transaction is recorded on a new ledger, so there is no multisig or private key involved.
5. Could you elaborate on how staking happens in other DeFi protocols across different ecosystems?
The indexer is the core of this cross-ecosystem process.
A Black module is created at the VM level of the destination ecosystem.
After the user has staked their collateral and selected the DeFi product. After the White module has confirmed the staking, the indexer and oracle would transfer the information to the black module at the VM level.
Once approved, the equal amount of stablecoin is minted on the destination chain.
Finally, YU on the destination chain format is swapped to supported stablecoin (USDT, USDC,...) before being staked on the DeFi protocol. All the steps happen in the back-end, providing a seamless experience to the user.
6. How is the YU-USDT/USDC pool maintained?
Yala would provide initial liquidity, but every pool on any ecosystem would be maintained organically over time as Liquidity Providers (LP) are incentivized to provide liquidity to earn fees from transactions. Theoretically, Yala would only need to maintain a single pool on the Uniswap Ethereum and publish the destination address of the YU on different chains so that LPs can create the pools.
7. What is the overcollateralization ratio and how are interest rates calculated?
Yala Foundation would decide the over-collateralization ratio, and the market participants would set the interest rates as the latter evolve depending on the offer and demand.
8. What are the sources of income for the protocol?
Our revenue stream comprises 3 sources:
Infrastructure tools: Fees from partner builders using the Indexer and Oracle service.
Application protocol: Fees from partner protocols' staking rewards.
Stablecoin: Stability fees paid in $Yala token, akin to an interest rate for generating YU, and liquidation fees for the collateral liquidation process when its value falls below a specific threshold.
9. What is your GTM strategy?
Our go-to-market strategy aims to position Yala as a key infrastructure for Bitcoin DeFi and ecosystems:
Pre-launch Stage: Build recognition for the Yala Protocol, aiming to partner with 10-15 key projects and grow our community to 200,000 members.
Launch Stage: Achieve widespread adoption of our architecture, lending protocol, and stablecoin. Success will be measured by the ecosystem's Total Value Locked (TVL) and establishing around 10 distribution channels with exchanges, wallets, and payment platforms for user accessibility.
Post-launch, Develop a decentralized governance framework, aiming for a foundation governed by and belonging to the DAO. This strategy leverages the network effect, with partners, community, and developers as vital stakeholders. The token will catalyze network growth, enabling decentralized collaboration. Additionally, decentralized governance ensures fair revenue allocation among participants.
10. What are the current partners?
Yala has partnered with the following protocols:
Babylon for restaking: As a delegate, Yala lets users stake BTC directly on Babylon via a dedicated module on Yala, and information is synchronized via API. As a result, Yala users can not only stake BTC but also pledge inscription assets to borrow additional BTC on Yala to stake on Babylon. This strategic initiative enhances yield generation for Yala's users and has transformed a prominent player in the Bitcoin DeFi ecosystem into one of our stakeholders.
Layer2 (L2) Botanix for applications: Botanix is an EVM equivalent decentralized platform built on Bitcoin. Yala will develop a Black module on Botanix to endow the Yala protocol with smart contract capabilities. On the other hand, Yala's indexer could help Botanix in parsing the data and integrating its capabilities into the inscription ecosystem.
Inscription project Nubit for efficient DeFi infrastructure: Nubit is a scalable, cost-efficient Data Availability (DA) layer designed to achieve instant finality, thereby considerably enhancing transaction confirmation times. Partnership scenarios include enabling Yala’s oracle to enhance data security and transparency to jointly support other L2 rollup solutions. Moreover, the Yala lending protocol could benefit from Nubit by achieving fast finality.
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