Ren protocol is a project that has experienced excellent growth in 2020 with the Ren-VM system having TVL (Total Value Locked) of over $146 million or 12,600 BTC. It is an application that lets people access liquidity between blockchains for different DeFi (decentralized finance) applications. Here, we will look at how Ren protocol can be leveraged with a Metamask wallet and Bitcoin Cash.
Leveraging Ren Protocol
The good thing about Ren protocol is that it works with both BCH (Bitcoin Cash) and ZEC (Zcash) because of its capability to cross-chain with three blockchains. After cross chaining, Ren protocol links them to Ethereum.
Minting renBCH – Synthetic Form of BCH
Fundamentally, renBCH is similar to renBTC since it is BCH’s synthetic form. After minting the tokens, it is possible to leverage them on different DeFi applications such as Uniswap or Curve. Additionally, the bridge application lets you release renBCH to receive BCH or any other coins leveraged while minting renBCH. However, it is worth mentioning here that it is not sustainable to mint anything less than the expenditure on fees.
For example, it is recommended that a $50 or higher amount of any supported crypto-asset be leveraged if you want to utilize Ren protocol after paying current fees.
Depending on the protocol being used, DeFi applications are available with little to absolutely no trust provision. But there is always a risk, and as such, people need to use due diligence. However, knowledgeable users can earn a good amount of money through the execution of flash loans, by offering pools of liquidity and farming yield.