Granite Review: Is Borrowing Against sBTC Worth It?

Granite is a lending protocol on Stacks with two main routes. As a borrower, you deposit sBTC as collateral and borrow stablecoins. As a liquidity provider, you deposit stablecoins into a pool that lends to borrowers, and returns come from the interest those borrowers pay. Granite describes its loans as open-ended lines of credit: there is no set repayment schedule as long as your position remains healthy.

This is not the same as borrowing directly against BTC on Bitcoin’s base layer. You need to use sBTC, a Bitcoin-backed asset on Stacks, and interact with Granite’s protocol there. Granite says sBTC is managed through Stacks validators using a threshold-signature system. That creates a route into Stacks DeFi, but it also means you need to understand the asset and bridge model, not just Bitcoin price risk.

Borrowers pay interest, and liquidity providers earn returns funded by that interest. Granite does not publish a fixed borrowing rate or a guaranteed lender yield in the project details, so you should check the live app and current protocol terms before supplying funds or opening a loan. Pool utilization and borrowing demand can affect what lenders earn; a displayed yield should not be treated as a promise.

The protocol also does not publish a complete fee schedule here. Check for any origination, repayment, withdrawal or liquidation charges in the app and documentation, and account for Stacks transaction costs. A small headline rate or yield is not enough to compare the deal: calculate the cost of the debt over the time you expect to hold it, and consider whether lender returns compensate you for smart-contract, sBTC and liquidity risks.

Granite says borrower collateral stays isolated and is never lent to other users. That avoids one common lending risk: a protocol using your collateral elsewhere and exposing you to losses across a shared pool. It does not make deposited funds risk-free. A contract bug, an oracle or market failure, a problem with sBTC, or a disruption affecting Stacks could still affect access to funds or the value of your position.

Two security audits are listed, attributed to Whitehat: Halipot and Whitehat: ABA. The listed information does not establish the audits’ scope, dates or whether all findings were resolved, so read the reports before relying on them. Granite does not publish licensing details or KYC requirements in its project information. It also states that the protocol is unavailable in the US; check current terms and local rules rather than assuming you can use it.

Granite uses loan-to-value, or LTV, to measure how much debt you have relative to your collateral’s value. If the value of your collateral falls or your debt grows enough to make the position unhealthy, liquidators can repay part of your debt and take the corresponding collateral plus a reward. This can happen even if you have not chosen to repay on a particular date.

Granite says its soft-liquidation design limits liquidators to the amount needed to restore solvency rather than allowing them to seize a larger share of collateral. That may reduce the damage compared with a larger liquidation, but it cannot prevent liquidation or guarantee that you will keep all your collateral. Leave room below the maximum permitted LTV, monitor your position and plan how you would add collateral or repay if BTC falls quickly.

You will need a wallet and assets that can interact with Stacks, but Granite does not publish a supported-wallet list, mobile-app details or transaction-speed guarantees in its project information. Confirm which wallet, stablecoin and sBTC route the current app supports before transferring funds. Moving assets across chains or into a protocol can involve additional steps and costs, so check each transaction carefully.

Granite promotes offline position tracking and push notifications, but do not rely on notifications as your only safeguard. Verify that alerts are enabled and keep an independent way to check your position. Start by reading the documentation and the current borrowing and withdrawal terms; then assess the LTV and liquidation mechanics before committing meaningful funds. The protocol is not available in the US, according to Granite, so confirm eligibility and local rules first.

Granite is a poor fit if you expect predictable interest income, a guaranteed lender yield or fully published fees. The return for liquidity providers depends on borrower interest, and Granite does not publish a fixed rate or guaranteed return. It is also not suited to people who want their Bitcoin collateral to earn yield: Granite says collateral is not rehypothecated and therefore does not generate yield for the borrower.

Choose another route if you do not want exposure to sBTC, Stacks or smart-contract risk, or if you cannot monitor a collateralized position through volatile markets. Borrowers should be ready to handle falling collateral values and possible liquidation. Granite says it is unavailable in the United States; anyone outside the US should still check whether the service is permitted where they live and whether the current terms allow them to participate.