What is HODL

Overview

HODL is the first permissionless yield vault on Bitcoin Layer 1. Built on OPNet, it lets anyone deposit a basket of OP-20 tokens and receive HDL — a yield-bearing index token whose net asset value (NAV) appreciates as the vault accumulates returns.

Think of it as a decentralised index fund running directly on Bitcoin. No bridges, no wrapped assets, no EVM. Just smart contracts compiled to WebAssembly and executed by Bitcoin consensus via OPNet.

Hackathon notice: HODL is currently deployed on OPNet testnet (March 2026) as an entry for the OPNet Vibecoding Challenge Week 2. Contracts are not audited. Do not use with real funds.

Bitcoin L1 via OPNet

OPNet is a consensus layer that brings trustless smart contracts to Bitcoin Layer 1. It is not a sidechain, not an L2 rollup, not a metaprotocol. Contracts are written in AssemblyScript, compiled to WebAssembly (WASM), and executed deterministically by Bitcoin nodes — enforced by Bitcoin consensus itself.

OPNet uses its own token standard, OP-20, which mirrors the ERC-20 interface but runs on Bitcoin. Key differences from Ethereum:

Method selectors use SHA-256 (not Keccak-256)
Wallets sign Bitcoin transactions, not Ethereum transactions
The wallet extension is OPWallet (not MetaMask)
Chain reads go through OPNet's own JSON-RPC provider

The Protocol

HODL is a four-contract system deployed on OPNet:

Contract	Role
`IndexVault`	Core vault — holds basket tokens, mints/burns HDL, manages rebalancing and yield
`IndexToken (HDL)`	OP-20 share token — represents your proportional ownership of the vault
`WrkToken (WRK)`	OP-20 incentive token — earned by anyone who rebalances the vault
`MOTO / PILL`	OP-20 basket tokens — the assets held inside the vault (50/50 target)

The vault is not itself a token. It holds MOTO and PILL on behalf of all depositors, mints HDL when users deposit, burns HDL when users withdraw, and pays WRK to anyone who keeps the basket balanced.

Why HODL

Diversified exposure on Bitcoin — hold multiple tokens through a single position
Yield-bearing — your HDL grows in value as the vault earns returns
Permissionless — anyone can deposit, withdraw, or rebalance; no KYC, no gatekeepers
Transparent — all basket holdings, NAV, and user positions are on-chain and auditable
Incentivised maintenance — the protocol pays WRK to anyone who keeps the basket balanced
Single-transaction exit — burn HDL and receive all underlying tokens in one Bitcoin transaction