Umoja has launched a product for Coinbase wrapped BTC (cbBTC) token holders, allowing them to earn a 6% annual yield on the layer-2 network Base. The yield is generated through various trading strategies, including covered calls and arbitrage. Participants can deposit cbBTC to Umoja, which is an ERC-20 token backed 1:1 by actual bitcoin held at Coinbase. The protocol also offers Yield Vault Tokens (YVTs) like yBTC, minted from cbBTC deposits. This initiative comes as the price of bitcoin has seen significant declines, prompting increased investor interest in yield-generating options to offset potential losses. Additionally, the Japanese firm Metaplanet has been leveraging similar strategies by using put options and spot asset purchases to earn yields amid falling prices. While the use of DeFi strategies to generate yields on bitcoin remains controversial among bitcoin maximalists, the growing demand suggests that such options may become more prevalent as investors seek to mitigate risks.

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