ELI5 guide on how to go from BTC to earning yield. tBTC
This guide strives to be one of the simplest guides of how to go from rock-solid classic BTC to earning yield in DeFi.
So without any further addition, let’s start.
Things you that you are required to have if you want to take this guide on from start to finish:
-Ethereum wallet. It’s one of the things in this list that are just obligatory. I will be using MetaMask, as it’s one of the most popular and convenient wallets. Ledger + MetaMask combo will be definitely a big plus to your security.
-Some ethereum. Yes, you’ll have to pay for the gas, so 10–200$ is needed. The amount you need highly varies on the path you will choose in this guide and on how hard ethereum network is congested at the time you’re doing all of this.
-Some bitcoin. 0.01 BTC is your bare minimum if you want to get your hands dirty and mint tBTC yourself to have a complete experience. There are other options, like buying on Uniswap which is actually cost-efficient for small lots. So be smart about that one and bring a calculator to the table.
-Bitcoin wallet. If later in this guide you will choose the “I will mint myself” path, you’re required to have a non-exchange wallet so everything can go smoothly. I would recommend non-custodial and hardware wallets, but that’s totally up to you.
Now when you’re all set and ready to go, please choose a path:
1) I like to get my hands dirty and mint myself
2) I am okay with swapping/exchanging
1) I like to get my hands dirty and mint myself
If you chose this path, be prepared to spend some ETH on fees and wait for 6 confirmations in Bitcoin. This is a road not for the faint-hearted, but you will be rewarded with the feeling that you interacted with the BTC-TBTC bridge in a “pure way”. If you are not that interested in minting, just skip the whole process and later I’ll show you how else you can get that juicy TBTC
1. When you have prerequisites mentioned in the beginning of the article, go to https://dapp.tbtc.network/ and click on the Deposit button.
If you fear doing something wrong, a good idea might be to try on the testnet first: https://dapp.test.tbtc.network/
It won’t hurt to do 1 test run, but you will need to find some Ropsten ETH and testBTC from faucets.
https://faucet.dimensions.network/ — faucet for ETH
https://testnet-faucet.mempool.co/ — faucet for BTC
2. Connect your wallet (in my case, that would be MetaMask)
3. Choose one of the lots: 0.01; 0.1; 0,2; 0,5; 1; 5; 10 BTC
Please be aware of whether it’s economically viable to mint a chosen lot. Since fees are minuscule for the 10 BTC lot, while you can feel financially hurt by minting 0.01 BTC.
In my case, I had to pay around $90 in fees for the whole process. A significant chunk of which is spent before you are sending BTC to the address.
4. After you select the lot size with which you’d like to proceed, you’ll see a transaction pop up. This would be the first and one of the most important transactions in the whole process, as this is where you spend the biggest amount on fees.
Review the transaction and confirm it if you’re willing to start the minting process.
5. After the first transaction was confirmed, you’ll have 2 consecutive transactions. Review them and confirm one by one.
6. Something brewing in the background (if you would like to get into technicalities, please see this quite thorough documentation: https://docs.keep.network/tbtc/index.pdf) and then you’ll see the generated BTC address.
You have to send there the EXACT sum according to the lot you’ve chosen. Be precise and use a wallet in which you control the sending amount and fee, so it won’t be an unpleasant surprise when you send 1 BTC and your wallet deducts a fee from this amount and not on top of it.
Another recommendation would be not using an exchange wallet, as not all exchanges are compatible with the minting process.
In some cases there are chances to save your money if you did something wrong, however, you should be careful and take full responsibility for your own funds. Remember, this is not your momma’s bank where you can call support and revert transaction, so behave accordingly.
In the end, you’ll receive slightly less than the chosen lot, as a small signer fee will be deducted from the sum you sent. But it’s calculated and deducted automatically, you don’t have to bother here with math yourself.
Sent it? Nice, now sit and relax, wait for 6 BTC confirmations. This is a security standard in Bitcoin, so please don’t be sad because of that, it’s all for your own good.
7. After you drank some tea and had 6/6 confirmations in Bitcoin blockchain, there’s time for the 4th interaction with the contract. Review, confirm the transaction, wait some time — everything as usual.
At this point, you still will be at step ⅘, two more incoming transactions that you should review and confirm. Wait for it, and…
8. … you finally reached step 5/5. Moment of glory, enough of contract interactions, now you’re the owner of BTC on Ethereum in a decentralized way — TBTC. You may write down TDT ID which corresponds to your lot size but be aware that someone else can redeem this TDT ID. Don’t worry, it doesn’t mean that he will redeem TBTC from your wallet. TDT IDs are interchangeable and you will be able to redeem other TDT ID.
If in the process you got stuck somewhere, don’t be afraid to refresh the page, it won’t affect your process. If you’re still afraid that it will cause you troubles, you can copy and save your current URL and open it up in the new tab.
In case you encountered any issues, don’t hesitate to ask questions in Keep discord, as we got quite a friendly and helpful community
Keep Network discord: https://discordapp.com/invite/wYezN7v
tBTC discord: https://discord.gg/RX5fkp
2) I am okay with swapping/exchanging
This option fits you well if you are okay with swapping through decentralized or centralized exchanges.
One of the quickest routes for small amounts would be buying TBTC on Uniswap. https://app.uniswap.org/#/swap?outputCurrency=0x8daebade922df735c38c80c7ebd708af50815faa
You can purchase it with whatever stablecoin or token you want, but it still will be routed through ETH currently.
The process is quite simple:
1) open ETH-TBTC pair https://app.uniswap.org/#/swap?outputCurrency=0x8daebade922df735c38c80c7ebd708af50815faa
2)Check whether you’re purchasing correct TBTC by seeing contract on etherscan
TBTC:
0x8daebade922df735c38c80c7ebd708af50815faa
(https://etherscan.io/token/0x8daebade922df735c38c80c7ebd708af50815faa)
3)Choose your slippage tolerance (usually you don’t want to be slipped for more than 0.5 or 1% on one swap)
3) Approve tokens before swapping
4) Review prices, slippage gas and then confirm swapping transaction.
5) You’re a fabulous owner of TBTC now and ready to earn yield on it.
Note: currently(October 2020) this option fits for small trade sizes. While if you have bigger stack, you should consider swapping through Curve. Below I will describe that option too.
Swapping on Curve:
1) Convert you BTC into WBTC through one of the merchants or exchanges listed here: https://wbtc.network/dashboard/partners
Or you can also use centralized exchange if you’re okay with that:
https://www.coingecko.com/en/coins/wrapped-bitcoin#markets
Binance, Coinbase Pro, Bittrex — they all have BTC-WBTC options.
2) After you successfully swapped/bought WBTC, withdraw it to your Ethereum wallet.
3) Go to https://www.curve.fi/tbtc and swap WBTC into TBTC.
4) Review and confirm transaction. Keep in mind, that in times of high congestion of Ethereum network, Curve swaps might cost you a significant fee, especially if you’d like to have a quick transaction.
5) Once again, you’re a fabulous owner of TBTC now and ready to earn yield on it.
Actually earning yield
Regardless of the way you chose, now you should already have TBTC on your wallet and that means you are ready to earn yield in Ethereum ecosystem.
What are your options:
1)Providing liquidity on Curve TBTC Metapool (metapool means it doesn’t dilute liquidity in the main sBTC pool, this option also has the lowest Impermanent loss chance) https://www.curve.fi/tbtc/deposit
This is actually an option I chose for myself, so here’s a quick instruction:
-Go to https://www.curve.fi/tbtc/deposit
-Connect your wallet
-Specify amount that you’d like to stake in the pool
-Click on Deposit & stake in gauge
-You’ll see “Allow Curve to spend your TBTC” — review and confirm it
-Another transaction (a more expensive one) pops up — review and confirm it
-When it’s confirmed, you’ll see “Allow Curve to spend your tbtc/sbtcCrv?” which is for Liquidity provider tokens you’ll receive — review and confirm
-Once again, another transaction (more expensive one) pops up — review and confirm it.
-After that you would be able to see your share of the pool on the same page. That’s it.
To see your gauge allocation and to claim rewards you can visit this page from now on https://dao.curve.fi/
Process is similar, you click on “Claim” and then review+confirm the transaction. After tx is confirmed, you’ll see a fresh harvest on your wallet.
2) Providing liquidity on Uniswap TBTC-ETH pool and earning fees from it (https://app.uniswap.org/#/swap?outputCurrency=0x8daebade922df735c38c80c7ebd708af50815faa) but please be aware that you will also need ETH in the same amount, and this is 50/50 pool and you have to be aware of the risk of impermanent loss.
3) Providing liquidity in Sushiswap WBTC-TBTC pair and earning fees from it. https://sushiswap.fi/pair/0x2dbc7dd86c6cd87b525bd54ea73ebeebbc307f68
An especially good option when it’s incentivized as a Weekly menu
4) Providing liquidity on Balancer WBTC-TBTC pool and earning fees from it:
https://pools.balancer.exchange/#/pool/0x17996cbddd23c2a912de8477c37d43a1b79770b8/
5) Providing liquidity on Mooniswap and earning fees for it:
https://mooniswap.info/pair/0x8eB54f8a6F6539B63F34bE602F24d501aE788B06
6) Any other option that you believe is viable and profitable for you. I don’t know how many more options we will have in the nearest weeks and months. Maybe some of the outlined options above will be irrelevant at the moment you’re reading this guide.
Well, what more should I say here, have a happy yield earning.
Some extras.
Always check addresses of all the contracts you’re interacting with, don’t just rely on the guide, check them yourself, it will save you a lot of money in the future.You may have noticed that sometimes I use TBTC with the capital T and sometimes tBTC. Here’s the difference:
tBTC — is a name of the tBTC dApp in Keep.Network
TBTC — is the token name, decentralized wrapped BTC that you are getting through tBTC dApp.
Chandru’s guide on Minting
https://medium.com/@chdru/tbtc-minting-steps-88162f9f416
Balancer farming guide by Keep-Latvia
https://keepnetwork-86223.medium.com/guide-on-how-to-mint-tbtc-and-start-yield-farming-on-balancer-wbtc-tbtc-pool-1dcefcd92d00
Coinsniperx’s (Alterhkhan) step-by-step guide for Uniswap
https://steemit.com/uniswap/@coinsniperx/how-to-mint-tbtc-and-add-liquidity-to-the-tbtc-eth-pool-on-uniswap-step-by-step-guide
Ildidetka’s detailed guide
https://cyberpunk9932.medium.com/how-to-make-your-btc-farm-in-ethereum-field-e6c8d47491c
tBTC Curve video-guide
https://www.youtube.com/watch?v=jWTbvw_VDwo&feature=youtu.be
