BTCz FAQ

Zest Protocol’s BTCz product is currently being phased out as part of a broader protocol refocus.

The team is now prioritising sBTC and the Borrow markets. As such, BTCz will be deprecated in the near future.

When BTC staking becomes possible on Stacks, a new version of BTCz may be introduced in a future iteration.

How does Zest Protocol Earn differ from Borrow?

Zest Protocol Earn is focused on providing the best experience for earning yield on Bitcoin.

Zest Protocol Borrow, on the other hand, is built for users who want to both earn yield and borrow against their Stacks-based assets.

How does Zest Protocol Earn differ from other BTC yield products?

We’re building for Bitcoiners first. That means prioritising security, permissionlessness, and a trust-minimised architecture.

Zest leverages Stacks' unique ability to read Bitcoin state and undergoes multiple independent audits on everything we deploy.

Is there a minimum deposit?

Yes. The minimum deposit is 0.0015 BTC.

Why wouldn't I just deposit BTC on Babylon over Zest?

Depositing BTC on Babylon locks your capital for an uncertain amount of time. Staking windows fill up almost immediately whenever they open, making it hard to get in.

BTCz, on the other hand, is a liquid asset—it can be traded, staked, leveraged, and more. Depositing through Zest to mint BTCz is a way to “skip the line” and avoid worrying about staking caps or timing windows.

How long does a BTCz withdrawal take?

Withdrawals may take up to 21 days, depending on:

• The Babylon staking mechanism

• Timing within the Stacks consensus cycle

Your dashboard will automatically estimate the expected timeline and display the date your BTC will return to your wallet.

"Please consolidate your UTXOs before trying again." error when trying to deposit BTC

Zest currently supports a maximum of 8 UTXOs for BTCz deposits.

If you exceed this limit, consolidate your UTXOs by sending all your BTC to yourself: Copy your Bitcoin address, paste it in your wallet, and complete the send transaction to merge UTXO

What are the risks of earning BTC yield through BTCz?

Yield is generated by taking risk. It's important to understand the risks before engaging in a particular yield generating activity. Earning BTC yield through BTCz relies on:

a) The Stacks L2. BTCz is a SIP-10 token on Stacks.

b) The Babylon Protocol. The BTC that backs BTCz is staked through the Babylon protocol.

c) Staking risk. Staked BTC can be slashed (i.e. destroyed) if the validator that the BTC is delegated to produces malicious blocks. Slashing is currently not active on Babylon, yet when it will be activated Zest Protocol will work with institutional grade validators who provide slashing insurance (Figment, Blockdaemon, etc) to protect user funds.

d) BTC Custody. The BTC that backs BTCz goes through Zest Protocol before being staked in the Babylon protocol. Currently a Cobo MPC wallet is used to hold BTC and stake in Babylon, ahead of upgrading the system to a permissionless peg using the same Treshold Signature Scheme that sBTC on Stacks follows.

We're very happy with the risk reward setup that Zest Protocol Earn is able to offer to users. The Stacks L2 is anchored to Bitcoin state through Bitcoin finality, the Babylon protocol functions entirely on Bitcoin L1 with limited scripting, and sBTC is the most secure decentralised BTC peg system ever designed. Zest Protocol Earn offers unparalleled security benefits over similar protocols that run on Ethereum with a fully custodial setup. However, it's critical that potential users get fully comfortable with the risks associated of using BTCz to generate a BTC yield.

What if I have a question not listed here?

Please join the Zest Protocol Discord and ask one of our helpful community managers! We are available to answer questions 24/7.