Bitcoin holders seeking to borrow against their holdings without wrapping BTC or using third-party custody were the focus of an Aave proposal reported by PANews on November 9, 2026. The proposal advanced through an ARFC vote, but activation still required a final AIP stage.
What the proposal would enable
According to Babylon’s announcement on X, cited by PANews, Aave DAO approved the ARFC proposal on November 9 with 100% of votes in favor. The proposed integration would use Babylon Trustless Bitcoin Vaults (TBV) to enable native bitcoin as collateral on Aave V4.
Babylon said BTC holders would be able to lock native bitcoin in a self-custodial arrangement and borrow assets such as USDT and USDC, without wrapping their BTC, using a cross-chain bridge or relying on a third-party custody protocol.
Terms and remaining approval
The integration’s collateral factors and borrowing rates would be comparable to those for wrapped assets such as WBTC and cbBTC on the Aave V4 Core Spoke. Aave DAO and Babylon would share related revenue, with a portion used to buy back AAVE and BABY.
For holders evaluating this custody model, the key distinction in the report is between proposal approval and availability: the next step was the final AIP stage to activate the integration on Ethereum mainnet. The reported ARFC vote was not itself confirmation that the service was live.
Original source: PANews, published November 9, 2026, at 23:41:55 (UTC+8).