Version: Next

Mint and Farm uUSDrBTC

This tutorial will show you how to leverage your BTC holdings to earn BAL and UMA tokens.

Useful Links

This is a three-part process:

  1. First you will wrap your BTC into renBTC so that it is usable on the Ethereum blockchain.
  2. Then you can use renBTC to mint uUSDrBTC tokens on the UMA protocol.
  3. Depositing uUSDrBTC into a Balancer pool will give you the ability to earn BAL and UMA tokens.

Step 1: Wrapping BTC into renBTC

Wrapping BTC into renBTC is possible using RenBridge, a decentralized application (dApp) that allows individuals to mint real BTC, ZEC, and BCH on Ethereum as an ERC20 (renBTC, renZEC, renBCH).

Navigate to https://bridge.renproject.io/ and click the Connect button at the top right corner to connect your MetaMask wallet to the dapp.

connect

Enter the amount of bitcoin you would like to wrap into renBTC,

amount

then, click Next

next

then click confirm. Before doing this, make sure you verify all the details in the modal.

Check that you are wrapping Bitcoin, as Renbridge allows you to wrap other coins like Zen and BCH.

The Destination should be your Metamask wallet address, this is where your renBTC will be sent to.

Also, check the cost (RenVM fee, Bitcoin Network fee) and the amount of renBTC you will be receiving.

Once you have done all of this, you can then go ahead and click confirm.

confirm

A one-time deposit address is generated for you to send your BTC to. Send the exact amount of BTC you are wrapping to that address, in a single transaction.

deposit

  • Your transaction requires 6 confirmations, which can take up to 1 hour, before the renBTC is sent to your wallet
  • You will need to accept & sign the transaction that sends renBTC to your wallet.

Step 2: Minting uUSDrBTC with renBTC

Minting uUSDrBTC tokens is easy with the EMP Tools, UMA's UI for ExpiringMultiParty contracts (EMP) which is what the uUSDrBTC token is minted from.

Navigate to http://tools.umaproject.org/ and click the "Connect" button at the top right corner to connect your MetaMask wallet to the dapp.

connect

Then, select the uUSDrBTC contract from the dropdown immediately underneath the header (above the tabs).

select EMP

Select the "Manage Position" tab.

manage position tab

Scroll down to the "Actions" dropdown and ensure that "Create" is selected.

position actions dropdown

At this point, make sure you read the text and confirm that:

  1. You will be minting at a collateralization ratio above the global collateralization ratio (GCR);
  2. You will be minting the minimum required number of tokens (100 for uUSDrBTC), and;
  3. You will keep your position collateralized above the minimum required collateralization ratio (CR) or else risk getting liquidated (the required CR is 125% for uUSDrBTC).

If you fully understand the above, and have decided on an appropriate amount of (1) collateral to supply and (2) tokens to mint, check to make sure you have enough collateral for minting.

token minting form

In the first field, fill in the number of tokens you want to mint.

In the second field, fill in the amount of collateral you want to supply.

If these values are appropriate, you can then click the "Create" button which will trigger a transaction with MetaMask. Once that is confirmed and the transaction is mined, you shall have your uUSDrBTC tokens!

Step 3: Farming uUSDrBTC on Balancer

danger

Supplying only USDC to the pool will result in auto-purchasing uUSD at the current price. This means you are market-buying uUSDrBTC, so be mindful of the trading price of uUSDrBTC before doing this.

By supplying liquidity to the uUSDrBTC/USDC Balancer pool, you have the opportunity to earn BAL and UMA tokens. The UMA token distribution is governed by the experimental UMA liquidity mining program. Read about this liquidity mining program here.

Head to the uUSDrBTC/USDC pool and click on the "Add Liquidity" button. You’ll be asked to Setup Proxy if you haven’t already

add liquidity button on balancer

Once the proxy is setup, the "Add Liquidity" button will show you a form for adding liquidity.

At this point, you might want to get some USDC so you can supply both assets to the Balancer pool. Alternatively, Balancer also supports supplying only a single-asset but that mechanism is out of scope for this tutorial.

Under the "All Pool Assets" tab, you should see something like this:

deposit assets on balancer

As with any other ERC20 token, you'll have to "unlock" (i.e. grant approval) for the dapp to transfer tokens on your behalf. Once you have done that, you can deposit uUSDrBTC and USDC into the Balancer pool in exchange for some Balancer Pool Tokens (i.e. BPT) specific to this pool.

This enables you to passively gain BAL and UMA tokens in accordance to the experimental UMA liquidity mining program. If you have any questions regarding this process, please don't hesitate to reach out on Discord.

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