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| Bitcoin DeFi |
Bitcoin-Based DeFi Ecosystem Experiences Explosive 1700% Growth
The center of Decentralized Finance (DeFi) is shifting from Ethereum to Bitcoin. Ethereum faces limitations due to layer-2 scaling issues causing liquidity fragmentation, while Solana's sustainability is questioned due to its meme coin-driven speculation.
Bitcoin is emerging as the new nucleus of DeFi, experiencing a remarkable 1700% growth in its DeFi ecosystem. Bitcoin DeFi's Total Value Locked (TVL) has surged from $300 million in early 2024 to $5.4 billion by February 2025. Protocols like Babylon ($4.68 billion), Lombard ($1.59 billion), and SolveBTC ($715 million) are leading the Bitcoin staking sector, transforming Bitcoin from a mere store of value into a productive asset.
Bitcoin DeFi is pioneering novel financial models beyond simply replicating Ethereum's approach. Innovations like dual staking and Bitcoin hash rate-backed tokenization are gaining traction. Utilizing mining power as collateral for lending, borrowing, and staking is also becoming increasingly prevalent.
The activation of Ordinals and BRC-20 tokens is driving a significant surge in transaction volume within the Bitcoin network. Bitcoin is increasingly positioned to become the new cornerstone of DeFi, transcending its role as just digital gold.
While Ethereum grapples with scalability challenges and Solana with a speculative economy, Bitcoin is garnering market attention for establishing a DeFi ecosystem rooted in its fundamental value proposition.