Babylon Advances Native Bitcoin Collateral Plan for Aave V4

The design choice matters more than the headline: keeping collateral native while using WBTC only for liquidation settlement tries to avoid the usual bridge-risk tradeoff, but it concentrates a new kind of dependency on the liquidation path. Aave governance is where this actually gets decided, and the pending risk parameters will determine whether Bitcoin collateral behaves like a conservative reserve asset or a volatile one. Whether the native-collateral model gets adopted beyond this single proposal is the open question.