BitVault, a DeFi protocol focused on reshaping Bitcoin’s role in stablecoin infrastructure, has closed a $2 million pre-seed funding round. The round drew support from strategic investors including GSR, Gemini, Auros, and Keyrock.
BitVault aims to create an institutionally-friendly alternative to traditional fiat-pegged stablecoins, positioning Bitcoin at the core of a new stablecoin ecosystem.
The funds will be used to launch two products: bvUSD, an overcollateralized stablecoin backed by Bitcoin derivatives, and sbvUSD, a yield-bearing version that leverages institutional trading strategies managed by GSR.
The move signals rising interest in BTC-based stable assets that offer greater decentralization, transparency, and alignment with institutional-grade financial practices.
BitVault to Anchor Stablecoin Infrastructure on Katana
BitVault will be a key stablecoin protocol on Katana, a new DeFi-first chain that is being developed by Polygon Labs and GSR with an emphasis on user rewards and deep liquidity.
It will use a licensed Liquity V2 fork to facilitate automated liquidation infrastructure, user-set interest rates, and permissioned borrowing.
“Bitcoin was built for moments of fracture. BitVault was built to make it usable,” said Michael Kisselgof, Core Contributor of BitVault and VaultCraft.
He added, “We specifically onboarded GSR, Auros, and Keyrock as strategic investors that can also execute high yielding, non-directional strategies to create demand and deep liquidity for BTC-backed money.”
Also Read: Melbourne-Based CloudTech Raises $14 Million Worth of Bitcoin and USDT in Series A Funding Round
BitVault Launches Amid Growing Demand for Crypto-Native Stablecoins in Fragmented Global Monetary Landscape
BitVault enters the market at a time when demand for crypto-native stable assets is rising, driven by concerns over the fragmentation of global monetary systems.
Unlike fiat-backed stablecoins such as USDC or newer algorithmic models like Ethena’s USDe, BitVault’s bvUSD is backed by Bitcoin derivatives, offering a decentralized yet stable alternative.
The protocol introduces a dual-access model: only whitelisted institutional players can mint bvUSD in large amounts, ensuring responsible issuance, while everyday users can mint it using existing stablecoins—helping mitigate risks associated with anonymous or overleveraged borrowing.
“We’re seeing growing interest in BTC-backed stablecoins, especially those designed to integrate seamlessly into DeFi ecosystems,” said Alain Kunz, Director from GSR, who participated in the round.
He added, “BitVault’s approach with experience in institutional-grade yield strategies positions it well for success. We’re particularly excited about its deployment on Katana, a DeFi centric chain we helped incubate. BitVault adds to Katana’s evolving ecosystem by introducing a new layer of stablecoin utility, enabling BTC to take on a more productive role within Katana’s high-yield DeFi stack.”
Also Read: Stablecoin Startup Ubyx Raises $10M Seed Round Led by Galaxy Ventures and Coinbase
DeFi Users Can Convert bvUSD into sbvUSD to Access Yield from Delta-Neutral and Arbitrage Strategies
DeFi users can now convert bvUSD into sbvUSD, a yield-bearing variant that taps into delta-neutral and arbitrage strategies.
These are executed by GSR, a top-tier crypto investment firm known for its market-making and OTC trading expertise.
By combining Bitcoin’s resilience with institutional-grade financial strategies, BitVault aims to deliver a scalable, transparent, and robust infrastructure for the next generation of digital money.