Working with Bybit's Earn platform, Avalon Labs has launched a new fixed-rate Bitcoin lending tool.

Avalon Labs announced that its institutional-grade lending layer is now live on Bybit's Earn platform. This development brings Bitcoin lending on-chain

Avalon Labs, known for its institutional-grade lending layer, has teamed up with Bybit to launch a new fixed-rate Bitcoin lending tool. This integration, announced by Avalon Labs, marks a significant step in providing efficient and stable yields to users on Bybit’s Earn platform.

How Avalon’s Brought Institutional Lending to Bybit Earn

Avalon Labs’ lending layer is now live on Bybit’s Earn platform. The integration aims to offer Bitcoin lending on-chain with a product designed to provide stable yields using arbitrage strategies executed behind the scenes.

Unlike traditional lending platforms where returns fluctuate, Avalon enables Bybit to offer predictable returns to users who deposit Bitcoin via the Earn interface. The approach leverages Avalon’s backend infrastructure to source yield using institutional borrowing markets and DeFi-native opportunities.

By enabling this infrastructure, Avalon and Bybit aim to position Bitcoin not only as a store of value but also as a yield-bearing asset—an important evolution for long-term BTC holders seeking passive income without compromising on security or control.

The Role of $FBTC in the Bitcoin Yield Engine

The process begins with $FBTC, a wrapped version of Bitcoin designed to maintain a 1:1 peg to BTC. Supported by Mantle and Antalpha Prime and with over $1.25 billion in total value locked (TVL), $FBTC serves as a Bitcoin-compatible asset across various blockchain ecosystems, including Ethereum.

Users deposit BTC, which is converted into $FBTC. Avalon then uses this $FBTC as collateral on its platform to facilitate fixed-rate loans in USDT. These borrowed funds are deployed into high-yield DeFi strategies, particularly through liquidity instruments like $USDe and $sUSDE, both part of the Ethena Labs ecosystem.

This DeFi strategy layer allows Avalon to lock in consistent yield through low-risk, diversified protocols. The returns from these strategies are then passed back to Bybit, which distributes them to Earn users based on their Bitcoin contributions.

Avalon’s Emphasis on Fixed-Rate Lending Meets Institutional Demand

Avalon Labs is already a recognized name in the on-chain lending and Bitcoin-backed stablecoin sector. The cooperation with Bybit offers DeFi-powered returns to regular customers and reflects a more general move into centralized platforms.

Avalon’s focus on fixed-rate, collateral-backed lending fits the growing institutional demand for products that provide consistent returns in a volatile market. Using the stability of Bitcoin and combining it with high-yield possibilities in DeFi, Avalon is creating a new lane in crypto finance.

The integration aims to make Bitcoin lending secure, efficient, and linked with mainstream exchange systems, enabling users to earn interest on their BTC holdings without leaving the Bybit platform. This capability is critical as investors seek alternatives to idle assets at a time when both transparency and control are paramount.