Elastos

BeL2 Lending Demo: Arbiter Integration and One-Click Deployment

BeL2’s V1 system Beta, officially released on January 6th, 2025, marks the milestone of Elastos’ commitment to transforming Bitcoin’s utility. Its architecture incorporates:

  • BTC Locking Scripts: Non-custodial mechanisms that keep Bitcoin securely locked on it’s mainnet, enabling it to serve as collateral.
  • Zero-Knowledge Proofs (ZKPs): Cutting-edge cryptographic proofs that allow smart contracts to verify Bitcoin-locking transactions without exposing sensitive details or bridging assets.
  • Oracle Services: A trustless bridge that relays Bitcoin proofs (ZKPs) to EVM-compatible blockchains, allowing BTC and other ecosystems to talk together.
  • Arbiter Network: Decentralized nodes that oversee transaction integrity, manage dispute resolution, and facilitate time-sensitive operations through staking mechanisms​​.

Together, these components form a decentralized clearing network service, transforming Bitcoin into a programmable asset without compromising its integrity. BeL2 is not a DApp—it’s infrastructure for building an Elastos ecosystem of “killer DApps” that leverage Bitcoin’s unmatched security and liquidity, such as BTC-Backed Loans, Native Bitcoin Stablecoins and Decentralized Exchanges and Swap services.

The BeL2 protocol has reached a significant milestone today with the integration of Arbiter nodes into the BeL2 Loan DApp, further supporting the official release of the BeL2 V1 Beta system. Alongside this, we’ve introduced a one-click deployment solution including an easy-to-follow video for Arbiter nodes, simplifying participation in the ecosystem. So, let’s jump in!

 

Lending DApp connectivity into BeL2 V1 Beta explained

The BeL2 Lending DApp is a decentralized financial application enabling native Bitcoin (BTC) holders to secure USDC loans on Elastos while keeping their BTC on the Bitcoin mainnet, without wrapping or bridging assets. Central to its operation is the Arbiter Network, decentralised nodes which ensures trustless dispute resolution and transaction oversight.

Today, when users take out loans, they pay ELA fees to compensate arbiters for their services. The fee covers the maximum loan period and is calculated based on the arbiter’s stake and fee rate. If the loan is repaid early, unused ELA is refunded proportionally. For example, if 100 ELA is locked for six months but the loan is closed in one day, 99.5 ELA is refunded. This system ensures fair compensation for arbiters while maintaining cost-efficiency for users. Currently, arbiters earn rewards exclusively in ELA, further incentivizing participation in the network, with BTC planned at a later date.

 

Simplifying Participation: One-Click Arbiter Deployment

Arbiter nodes are the backbone of BeL2’s governance and dispute resolution, receiving fees in return for services. The new one-click deployment solution simplifies their setup, making it easier for community members to join the network. Existing Elastos BPoS nodes can also run Arbiter nodes, further lowering entry barriers and encouraging widespread participation. For an understanding on this simplicity, please see:

 

 

BeL2 V1 Beta Phase: A Call for Community Engagement

During this beta phase, we invite more community members to explore and test the system. A beta phase indicates the product is functional but still under active development and refinement. While core features are operational, limitations and occasional bugs may exist. User feedback is essential to refining the system and accelerating adoption. You can help by doing the following:

Be sure to understand Arbiter risks, noting the beta release operates with reduced staking limits to maintain stability while gathering valuable feedback. A proposal to the Cyber Republic Consensus (CRC) will soon outline a rewards program to further encourage participation. This includes:

  • Incentive Structures: Providing additional rewards in BTC and ELA for borrowers, lenders, and Arbiters​​.
  • Gas Abstraction with Particle Network: Eliminating ESC gas fees for borrowers to simplify user interactions.

 

A Symbiotic Relationship: Bitcoin and Elastos

As many know, BeL2 leverages the historical connection between Bitcoin and Elastos through merge mining. Sharing over 50% of Bitcoin’s hash power, Elastos benefits from Bitcoin’s robust Proof of Work (PoW) security.

This relationship underscores the ethos of BeL2: harnessing Bitcoin’s resilience to power decentralized, scalable financial applications​​. BeL2 continued innovation by representing a paradigm shift for Bitcoin and decentralized finance:

  • True Decentralization: Avoid reliance on custodians or wrapped assets.
  • Financial Sovereignty: Retain control of BTC while accessing liquidity and programmable financial tools.
  • A Framework for Innovation: BeL2 creates a foundation for developers to build scalable, secure applications on Bitcoin​​.

The BeL2 protocol is poised to redefine what’s possible with Bitcoin. Whether you’re a borrower, lender, or Arbiter, now is the time to explore, engage, and help shape the future of decentralized finance!