What is BadgerDAO?

What is BadgerDAO?

What is BadgerDAO?

…and how do you make money on it?

Dapps & Protocols

·

11 min

What is BadgerDAO?

…and how do you make money on it?

Dapps & Protocols

·

11 min

What is BadgerDAO?

…and how do you make money on it?

Dapps & Protocols

·

11 min

What is BadgerDAO?

…and how do you make money on it?

Dapps & Protocols

·

11 min

What is Badger DAO?

Are you tired of feeling like Bitcoin is the loner at the DeFi dance party? Well, you're not alone. Despite being the world's largest cryptocurrency, Bitcoin has long been considered something of an outsider in the DeFi space, thanks to its unique architecture and limited programmability.

But fear not, my friend, because Badger DAO is here to bridge the gap and bring Bitcoin into the DeFi limelight. With a focus on creating an open and decentralized platform for users to earn, save, and manage their digital assets, Badger DAO is showing the world that Bitcoin can be just as hip and happening as the rest of them. 


Badger DAO is a decentralized autonomous organization that was launched in December 2020 with the goal of providing an open and decentralized platform for users put their Bitcoin to work. The project focuses on Bitcoin and aims to create a DeFi ecosystem around the world's largest cryptocurrency.

The project's native token, BADGER, is used to incentivize users to provide liquidity to the various Badger DAO pools, which include the Sett vaults, which allow users to earn yield on their deposited assets. In addition, Badger DAO has partnered with other DeFi projects to create cross-platform integrations and expand the range of services offered to users.

One notable event in Badger DAO's short history was a security incident in February 2021, in which an attacker exploited a vulnerability in the Sett vaults and drained approximately $24M in funds. Badger DAO responded quickly to the incident and worked with the affected users to restore their funds. The project also implemented additional security measures to prevent similar attacks in the future.

Despite this setback, Badger DAO has continued to grow and expand its offerings. In March 2021, the project launched a DEX called Badger Bridge, which allows users to swap tokens between Ethereum and the Bitcoin-based sidechain network, BNB Chain.


In December 2021, disaster stroke again. BadgerDAO experienced a phishing incident that was caused by “a maliciously injected snippet” from Cloudflare, an application platform that runs on Badger’s cloud network.

The hacker used a compromised API key that was created without the knowledge or authorization of Badger engineers to steal $130M from the protocol. Badger has since patched the Cloudflare exploit, and the protocol has rebounded spectacularly.

How does Badger DAO work?

Before Badger DAO, the possibilities of earning yield were low-yield. DeFi protocols such as Compound, Aave, and Nexo all offer modest APY for Bitcoin deposits but are minimal compared with interest for other crypto tokens. 

Badger ibBTC

DeFi has managed to create different versions of wrapped Bitcoin such as wBTC, renBTC, tBTC & sBTC. The main use of such tokenized assets is to be used on the desired blockchain.

Badger and DefiDollar came up with the idea of bundling all these assets into an index that would act as the default BTC-dominated asset on the Ethereum Blockchain. And so, the Interest Bearing Bitcoin (ibBTC) was born.


The interest accrual for ibBTC comes from underlying Badger Setts and Curve pool yields so that those holding ibBTC are passively earning 3 yields at once: Curve trading fees, farmed CRV, farmed BADGER.

The trading fees from Curve along with the farmed BADGER and CRV are swapped back into the underlying tokenized BTC. Holders of ibBTC earn yield from holding the token and they are freely able to trade it. 

Users can mint inBTC by providing liquidity to Bager's Sett Vaults 

ibBTC may be redeemed for the underlying vault tokens at any time or traded on

Badger Sett Vaults

Inspired by the complex tunnels where badgers live, Sett Vaults is a system of vaults that works in a similar way as Year Finance. These vaults are smart contract lockers containing yield farming strategies deployed across DeFi protocols.

Users can deposit over 20 Bitcoin-linked crypto assets into the vaults and earn the best possible yields. Some strategies rely on lending assets to earn interest, or farming other DeFi protocol's governance tokens.

By pooling funds together, users can save up on gas costs and earn additional rewards. Sett vaults are incentivized by BADGER emissions, which means users earn BADGER tokens in addition to the yield from their deposited asset. 

Badger Boost

The BadgerDAO community voted to allocate more rewards to the governance participants and those who hold native Badger assets in their wallets or Sett Vault. This system is known as Badger Boost.

In simple terms, Badger Boost increases the amount of BADGER rewards who stake more of their native tokens. 

Badger DIGG

DIGG is the first decentralized, elastic supply crypto asset pegged to the price of Bitcoin and governed by BadgerDAO.

It is important to note that DIGG is not backed by Bitcoin under management. Instead, the smart contracts that underpin DIGG adjust its price to be loosely pegged to the value of Bitcoin.


Every day, a "rebase" occurs. If the price of DIGG is greater than 1.05 BTC, the supply of DIGG in wallets and smart contracts increases. If the price is under .95 BTC, the supply decreases. If the price is between .95 and 1.05 BTC, the supply remains unchanged. In this way, the smart contract works to push circulating supply of DIGG closer to an equilibrium where the market demands an amount of DIGG such that its price equals the current price of BTC.

Rebases change the number of DIGG tokens you see in your wallet, but does not change your percentage ownership of total supply.

In addition to holding DIGG, users can stake their token into the Sett Vaults and receive bDIGG. Similarly to ibBTC, staked DIGG is an interest bearing token, which means the value of bDIGG increases while the amount of DIGG staked remains stable.

How to make money on Badger DAO?

Making money on Badger DAO is as easy as depositing funds into a liquidity pool. Holding Bitcoin isn't mandatory, as Badger vaults support multiple assets.

One of the advantages with Badger DAO is that users can see how each strategy has performed over time and make a better informed decision on where to invest.

Badger ibBTC

Minting ibBTC can be a useful strategy to get your Bitcoin involved into DeFi. The asset is fully collateralized, which means you can redeem your BTC at anytime with an interest on top. 

In order to profit from ibBTC, you must first hold any amount of wBTC, renBTC, or variations of wrapped Bitcoin on Curve. Don't worry, the full list is on the app.


Here's how you mint ibBTC:

1. Open the Badger app

2. Click "ibBTC" on the top header

3. Select the asset you want to post as collateral

4. Fill in the amount you would like to mint

5. Approve the transaction in your wallet

6. Profit

By minting ibBTC, you are holding an interest bearing token. When you decide to withdraw, you will get. back the collateral and the accrued interest.

Badger Sett Vaults

Sett Vaults represent the primary mechanism of earning yields on your assets. Each of the Vaults has its own strategy and reward emission schedule. 

When you deposit in a Sett you will receive a “wrapped Sett token” that represents your position in vault. Wrapped tokens represent the yield bearing token. For some vaults, the yield auto-compounds. The auto-compounding feature is mentioned specifically for every Vault.


To access Sett Vaults, follow these steps:

1. Open the Badger app

2. Click "Vaults" on the top header

3. To deposit or withdraw, click on the appropriate Sett

4. Fill in the amount you would like to execute

5. Approve the transaction in your wallet

6. Profit

It is important to note that certain Sett Vaults charge fees that go to the protocol treasury, or get shared with the strategist who wrote the vault strategy. Fees are factored into all ROI calculations, therefore the advertised APY is what you receive. 

Badger Boost

Badger Boost represents a way to increase your BADGER profits by holding or providing Badger native assets to the Sett Vault. You can increase your multiplier boost by increasing your Stake Ratio, which is the ratio of the native positions you currently hold against the non-native ones. If you hold more BADGER than non-native assets, you are eligible to receive a multiplier on your BADGER rewards.


The Badger Boost calculates your reward automatically, no action is required. If you are curious about how the reward is calculated, follow these steps:

1. Open the Badger app

2. Click on the "Boost" on the top header

3. Input the equivalent dollar value of your BADGER assets

4. Input your dollar value of non-native assets

Depending on the amount entered in both brackets, you will see how your multiplier adjusts. This is a simple way to assess the opportunity cost of holding more BADGER. If the price of BADGER assets goes up, it could be a profitable strategy to hold more BADGER. On the other hand, if the APY from Sett Vaults is profitable on its own, you can sell your BADGER and focus entirely on the APY from non-native assets.

Price Prediction for Badger DAO — Can it hit $100?

Buying and hodling BADGER — the native token of Badger DAO — is one way of potentially making money on BADGER.

The main utility of BADGER is to serve as the governance token for the protocol. The value of BADGER is directly tied to the number of Badger DAO users. Because Badger DAO bring Bitcoin to DeFi, the protocol has a fair chance to attract new users.

Every decision regarding the Badger DAO development is voted by the BADGER holders. This means the price of BADGER will increase in direct proportion to the value locked in the protocol.

By looking at its current price, it’s natural to think about the chance of BADGER hitting $100 per token. This can happen sooner, or way in the future, and is determined by a couple of ever changing factors.

Let’s examine the potential growth of the BADGER token by analyzing its tokenomics. BADGER’s current market cap sits comfortably at ${MARKET_CAP}. With {CIRCULATING_SUPPLY} BADGER tokens being in circulation today, that means a price of {PRICE} per BADGER.

How did we come to that calculation? It’s quite easy, the price of a BADGER token is equal to its current market cap divided by the number of tokens in circulation. Dividing ${MARKET_CAP} by {CIRCULATING_SUPPLY} gives us a result of {PRICE} for each BADGER coin. 

By changing the order in the simple formula above we can use it to calculate other things as well. This helps us a lot because we can deduce the market cap of BADGER at different token prices. Then, we can use the result to compare it to the current state of the network and see what would be required for BADGER to hit that price.

At a price of $100 per token, that means the current market cap of BADGER would equal ${{CIRCULATING_SUPPLY} * 100}. Remember that we arrived at this number by multiplying the amount of circulating tokens by $100.

Now let’s shift our attention to the fully diluted market cap.

Some blockchains may have their tokenomics built in a way that only a small percentage of tokens are circulating at the beginning. This can be misleading because we don’t have the full picture and only take into account the current number of coins released in the market.

The fully diluted market cap represents the total value of a coin if all tokens were in circulation. BADGER’s whole supply of tokens is {MAX_SUPPLY - TOTAL_SUPPLY + CIRCULATING_SUPPLY} BADGER which means that no more coins above that number will ever be created.

These tokens are not created at the discretion of a specific entity. They are created automatically by the network to reward different actors that keep it secure.

How does this impact the price of BADGER? Taking into account the current price of a BADGER token, that would result in a fully diluted market cap of ${MAX_SUPPLY - TOTAL_SUPPLY + CIRCULATING_SUPPLY * PRICE}. BADGER coins that have been burned are not taken into consideration because they have been permanently removed from circulation.

Whether it seems gigantic or not, the number we came to above only takes into account the current price of a BADGER token. Doing the same calculation but with a price of $100 gives us a result of ${{MAX_SUPPLY - TOTAL_SUPPLY + CIRCULATING_SUPPLY} * 100} for the BADGER protocol fully diluted market cap.

These are all crucial details to know when calculating if BADGER can reach the price of $100 per token. If the diluted market capitalization is way too high, the token has little room left to grow. Blockchains in general have no cap on the value they can reach, whether that number seems possible it’s totally up to you.

The future of BADGER depends solely on its growth as a network used by tens and hundreds of millions of users. While Badger DAO had its fair share of security challenges, the protocol still has a lot to offer to users holding Bitcoin. Technically, the price of BADGER can reach $100 by 2030.

If you’re looking to add some BADGER to your portfolio, the most trusted places to get some are Binance and Coinbase.


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