Glossary of Solv Protocol and BTCFi terms
Bitcoin finance has its own vocabulary, and a few terms do a lot of work. These are the definitions used across this site — written to be understood on the first read, not to sound clever.
- SolvBTC
- Solv’s base Bitcoin token, intended to be backed 1:1 by Bitcoin in reserve and transferable across multiple blockchains. It is the building block the rest of the system sits on.
- Liquid staking token (LST)
- A token you receive that represents an asset put to work in a yield strategy, while staying liquid and tradable. SolvBTC.BBN, SolvBTC.CORE and SolvBTC.ENA are examples built on SolvBTC.
- BTCFi
- Short for ‘Bitcoin finance’ — the growing set of DeFi activities that use Bitcoin as the core asset rather than just holding it idle.
- Staking Abstraction Layer (SAL)
- Solv’s framework that standardises how Bitcoin is routed into different staking and yield venues, so users get one consistent experience instead of dealing with each venue separately.
- Proof of reserve (PoR)
- A way of publicly demonstrating that issued tokens are backed by real assets held in reserve, so holders can verify backing rather than trust a claim.
- Peg
- The intended 1:1 relationship between SolvBTC and Bitcoin. A token ‘trades off peg’ when its market price drifts away from the value of its backing.
- Redemption
- Converting a token back to its underlying asset — for example returning SolvBTC to recover the underlying Bitcoin, subject to the protocol’s process and any conditions.
- Restaking
- Reusing already-staked assets to help secure additional networks or services, earning extra rewards in exchange for additional risk.
- Babylon
- A protocol that enables Bitcoin staking to help secure proof-of-stake networks. SolvBTC.BBN represents Bitcoin staked through Babylon.
- Loan-to-value (LTV)
- The ratio of what you have borrowed to the value of the collateral backing it. Higher LTV means less safety margin before liquidation.
- Health factor
- A number used by lending markets to show how close a borrowing position is to liquidation. When it falls to the liquidation threshold, collateral can be sold to repay the loan.
- Liquidation
- The forced sale of collateral to repay a loan when its value falls too far relative to the debt. It protects lenders but can cost the borrower part of their collateral plus a penalty.
- ERC-3525
- A semi-fungible token standard that Solv Protocol pioneered and helped standardise, combining traits of fungible (ERC-20) and non-fungible (ERC-721) tokens.
- SOLV
- The protocol’s governance and incentive token, used for voting, staking for rewards and fee-related benefits. Distinct from the Bitcoin-backed SolvBTC.
- Cross-chain interoperability
- Infrastructure that lets a token move and stay consistent across different blockchains. Solv uses interoperability tooling to keep SolvBTC unified across networks.
- Seed phrase
- The secret list of words that controls a self-custody wallet. Anyone who has it controls the funds; it must never be shared or typed into a website.
Still stuck on something? The FAQ answers the most common questions, and What is Solv Protocol gives the big picture. Verify anything operational against official channels in the footer.