Last year, the 16-year-old blockchain received new features, including Ordinals, Runes and BRC-20 tokens. Despite the market correction, developers have remained enthusiastic about the growing ecosystem ahead. 🚀

“Currently, two key factors are limiting the development of BTCFi: lack of underlying yield and fragmented liquidity,” said SolvBTC co-founder Ryan Chou.

SolvBTC, a Bitcoin yield protocol, is developing Liquid Yield Tokens that will allow Bitcoin holders to deposit their assets and earn income from DeFi.

“I would like to take SolvBTC Ethena Vault as an example to explain how Solv brings stable underlying returns and rich earning opportunities for Bitcoin users,” Chow explained.

SolvBTC will soon launch on the Ethereum mainnet, allowing its users to leverage the liquidity of wrapped Bitcoin (wBTC) and generate earnings directly within the Ethereum DeFi ecosystem.

Meanwhile, other developers are focused on increasing the underlying capacity of the Bitcoin blockchain to improve its performance in DeFi.

“Bitcoin cannot solve the problem of congestion and high fees in the foreseeable future,” said Sunny Fung, the main developer of MetaID. However, layer solutions on top of Bitcoin can mitigate the problem by combining individual transactions into a single application to save time and effort.