Hey guys, thanks so much for being here. Super excited to be here at Vault Summit again. Really excited to host a couple of our very important partners and people we talk to literally like every week. Let's start off with a round of intros. I'm Ann. I lead partnerships and capital markets here at Gauntlet. And then let's go first with Ming and then Gracy and Kate.
Hey. My name is Ming. I'm a quant researcher at Gauntlet. I'm in charge of some of our DeFi strategies.
Hi, I'm Gracy Chen. I'm CEO of Bitget. We are a crypto exchange that has more than 120 million users, and we are collaborating with these folks.
Hi, I'm Kate. I lead DeFi and liquidity at Morph. Morph is a payment ecosystem.
Great. Okay. So, I know earlier this year, Bitget released BGBTC, Bitget's own Bitcoin wrapper, and offering yield to users. What makes this product such an important one for your exchange and wallet, Gracy?
Sure. So exchanges were born in early days to be a trading platform, but users today in 2026, their needs when they are coming to an exchange is very different, is far more than just trading. So for example, at Bitget they do all sorts of activities. They do trading, they do earning, they also purchase stock these days with us, commodities. And then earning is a very important part of our users' function, especially for high net worth individuals or for VIP users, like they may not be a very active trader per se, but they have a lot of AUM with us. So they want to see, okay, what can I get for my money here to do some wealth management, to do some earnings. And also because some of our users, when they have earning needs, it's majority, it's mainly in these few cryptocurrencies: Bitcoin, Ethereum, or stables. So Bitcoin, as you know, it doesn't have like the so-called yield, sort of staking yield like Ethereum, nor the yield coming from stablecoin. So when we have some BTC offering for our users, we really need to be very careful about our partners, what sort of reward and risk that the earning product brings. So we are very selective in terms of who we partner with. Our team actively monitor the risk and reward. We do a very thorough analysis before we onboard anyone, and we disclose those information to our users. But in general, earning, and especially Bitcoin earning that we are talking about here, or we are collaborating here, is a function or is a product that our users need a lot.
Great. Great. Yeah. Great introduction on Bitget and demand from your users. Being from the Gauntlet side, Bitcoin doesn't have native yield and we use these Gauntlet vaults in order to generate yield on Bitcoin. Can you walk us through what exactly a curator actually does to get that yield?
Yeah. So exactly like you said, Bitcoin itself isn't a yield asset. So with BGBTC and Morph, the basic structure is that we use BGBTC as collateral to borrow stables against it and then we deploy that stable into yield opportunities. And then we would convert that spread between the yield vault stable yield versus the borrow rate back into BGBTC holdings. This way we maintain, you know, like delta neutral to BTC and USD prices and thus, you know, protect the BTC holders. You know, these positions themselves aren't super sophisticated. A lot of people are doing that. And in fact, like taking on these positions is only like 10% of our curator job. The remaining 90% is trying to address the risks that are associated with this type of strategy and do a lot of like real-time adjustments to keep the positions healthy. So for example, you need to constantly adjust the target borrowed position amount of loans to take, basically, because too high of an LTV will get you liquidated. Too low of an LTV would mean that there's not enough capital efficiency, therefore not like a very good yield on the product. So we need to make these trade-offs 24/7. Another example is that we have automated monitoring systems for a lot of risk factors. And we have, you know, pre-designed basically these de-risking measures in response to each type of scenario, each type of event. So whenever an event triggers our alert system, the system will perform these de-risking operations according to a plan. And then a big part of that is actually Arya, our AI agent. So if you haven't read our recent blogs on Arya, I invite you to read those blogs and go on our website. The reason we use a lot of automation is that it gets rid of the risk of having human errors on these like type of stress events. And then that ensures our operations were both fast and accurate. Yeah, but at the same time we always also have a human in the room to supervise and basically, you know, like sign off on every operation. So personally, I think the point of having a curator versus like doing, say, yield farming yourself is to have someone preemptively think through all the good and bad scenarios before they actually happen and make plans for exactly what to do under each scenario. All of these usually happen behind the scenes, and you know, you don't get a lot of credit for things that didn't happen. So it's part of the, it's the nature of our job as a curator.
Great. Yeah, definitely good to have a risk control in the room here. And then to Kate on the Morph side, we launched both BTC and USDC earn for the wallet and the CEX on Morph. What was the thought process bringing it to Morph and how does that play into your vision for the chain?
Morph's vision, or at least my own version of it, is a very secure and efficient infrastructure where eventually all of our users' financial needs can happen. Take our BTC product that we launched for example with Gauntlet and Bitget. Also want to take this opportunity to thank Gauntlet and Bitget. A lot of hard work was put into it, and definitely I think we reached north of 100 mil TVL in 20 days. I think the result is that we did deliver something our users want, and that is definitely a meaningful step, but also just the first step towards more vision.
Great. Yeah. And playing into what Kate mentioned, Gracy, we reached pretty good TVL numbers in the first 30 days. What keeps someone from going back, keeping their money in BTC earn or also keeping their money in Bitget?
Hopefully no hack, no incident like that. As I just want to point out the elephant in the room in case it is in some people's mind, so keeping our users' assets secure is of course very important on the company level as well as on the chain or this specific earning product level. And as you see how we managed the incident that happened about 10 days ago, like no users' balances are affected, the company bear all the cost from the hacks and the stolen fund. But above all, maintaining a secure system is key, is our number one job. We've been operating for eight years and this is the first incident we've ever had. I'm sad the number is not zero anymore. It is one, but still we are managing it very well. So I guess similarly for any users who have some money with us, especially on this product, they want to make sure, okay, this is a BTC earn program. I'm having earning, not losing, right? Something like that. And be aware of any sort of risk, be it liquidity risk or reward, like the principal sort of loss and any sort of risk. We want to make sure that the users are aware of them. And again, like when we are selecting the partners, we also want to know that we have different rounds of selection and assessment. We want to know that you guys know what you are doing. And as Ming Shan was pointing out, like you have to maintain a fair amount of TVL, it's not too high, not too low, to have enough capital efficiency to generate enough yield for the user, but still managing the risk very well. So hopefully that's when we do a good job over there, we have our users coming back to our platform all the time.
