Bitcoin DeFi to Surpass Ethereum and Solana With 300M Users, Experts Say

• Bitcoin DeFi is the next big thing, with startups positioning to take market share.
• The coin serves as the best liquidity, and the yield on the coin is a big boost for holders.

Crypto expert Alexei Zamyatkin says Bitcoin Decentralized Finance (DeFi) could outgrow the Ethereum and Solana ecosystems. The expert believes the scenario could play out if a firm launches a user-friendly suite of products on Bitcoin. 

Bitcoin, Ethereum, and Solana: DeFi Rivals

According to Zamyatkin, this move positions the firm to win the blockchain’s 300 million users. This would mean DeFi services on the Bitcoin network surpassing those of Ethereum and Solana. Zamyatkin, a co-founder of Build on Bitcoin, a Bitcoin Layer 2 firm, disclosed the information during an interview at Token2049 in Dubai. 

Notably, Build on Bitcoin is among the firms looking to win market share. The firm offers a hybrid layer 2 solution that combines Bitcoin’s security with Ethereum DeFi capabilities via BitVM, a platform that processes Turing-complete Bitcoin contracts.

Zamyatin argued that Bitcoin-native bridges are essential for DeFi on Bitcoin, as the blockchain’s security is strong. However, he pointed out that Bitcoin lacks Ethereum’s tools,  human talent, and network effects. 

The expert noted that Bitcoin yield and stablecoin products drive strong demand for Bitcoin-based DeFi offerings. He cited an example of institutional Bitcoin buyers requiring yield on their assets. 

Notably, Bitcoin staking has become the main DeFi use case outside of payments. Bitcoin staking involves holders locking their coins in self-custodial vaults or extractable one-time signatures. The core aim is to earn staking rewards on Proof-of-Stake (PoS) blockchains like Ethereum.

Previously, we explored that the Babylon protocol dominates the Bitcoin DeFi ecosystem with a Total Value Locked (TVL) hitting $5.9 billion. Recent data from DeFiLlama shows that the Babylon Protocol represents nearly 80% of all value locked on Bitcoin. 

Although the Bitcoin DeFi ecosystem is gaining traction, the TVL is still a fraction of the $54.6 billion worth of value locked on Ethereum. However, Zamyatin added that the demand for Bitcoin-backed stablecoins is also skyrocketing because Bitcoin is the best collateral.

Can Bitcoin DeFi Fuel a BTC Run?

Bitcoin’s growing DeFi TVL continues to fuel sentiments about a massive price rally for BTC. As featured in our recent coverage, Binance disclosed that the DeFi activities around Bitcoin have more growth potential. A Binance spokesperson believes that the evolving market could increase demand for the asset and subsequently impact the price.

Overall, the growth in Bitcoin-based DeFi protocols signals growing institutional interest and mainstream adoption. In March, the price of Bitcoin saw a slight increase after the TVL in Bitcoin-based DeFi protocols soared to $8 billion.

As more BTC is locked into DeFi protocols, the circulating supply decreases, potentially driving upward price pressure. At press time, BTC was trading at $96,722, reflecting a 3.09% increase over the previous day.