Overview

The Yala protocol is an innovative DeFi platform that bridges Bitcoin liquidity across multiple ecosystems.

The architecture is divided into three interconnected sections.

Bitcoin Side: On the Bitcoin side, the focus is on the Notary Bridge, which utilizes cryptographic signatures to mint yBTC. This tokenized version of Bitcoin is crucial for bridging assets into the Yala Network.

Yala Network: yBTC flows into the Yala ecosystem, where it acts as collateral on different ecosystems. Within the Yala Network, users can mint the stablecoin $YU. Once minted, $YU can be utilized across various DeFi protocols for yield generation. The Yala Network also offers additional opportunities for users to earn yields through options like YU Savings Rate, Yala Earn, staking, payments, and participation in secondary markets.

Pro Mode: On the Pro Mode side, advanced users leverage yBTC within the Yala Vault. This allows them to access Bitcoin Layer 2 (L2) solutions like Babylon, Ethena Protocol, and Lorenzo Protocol. In this mode, users can generate additional yield through liquid staking tokens while maintaining exposure to Bitcoin.

Core Components

• Vaults Module: Manages over-collateralization and collateral for each user.

• Minting Module: Handles the $YU creation process.

• Liquidation Module: Ensures system solvency through automated liquidations when necessary.

• Keepers and Oracles: Maintain stability and provide up-to-date price data for collateral assets.