Zest Protocol Unveils Mainnet Demo for Native BTC-Ethereum Lending

Zest Protocol has launched a mainnet demo for its Bitcoin Collateral Vaults system, allowing native BTC to back USDC loans on Ethereum without requiring wrapping or bridging.

The demo uses real Bitcoin and USDC but limits collateral deposits to 0.001 BTC per wallet to control exposure and test system functionality under constrained conditions.

Users deposit native BTC into self-custodial Taproot vaults on Bitcoin, while Ethereum smart contracts manage the USDC borrowing side using a collateral record linked to the BTC vault.

Collateral destinations are pre-authorized by depositors when the vault is created, preventing misuse or unauthorized redirection, and BTC returns to users via pre-authorized paths once loans are repaid.