Unlocking on-chain liquidity for #Bitcoin will be a story that will gain a lot of attention in the near future.
For many years, Bitcoin has only had a few methods of use such as sitting in a wallet and storing value, OTC, off-chain payment and most recently Ordinals.
Since the Inscription movement, the Bitcoin DeFi picture is moving in a completely new direction. Previously, the story of unlocking liquidity for Bitcoin came from off-chain liquid staking BTC through Cex exchanges or custodial vaults, now it is developing into on-chain liquid staking BTC (non-custodial).
The difference lies in control, those who hold Bitcoin on-chain are mostly whales with large assets, so in case of necessity they do not want to hand over BTC to anyone to babysit. Therefore, off-chain profitable activities inherently do not attract much attention. Instead of taking risks, they keep BTC in their wallets, which gives them a much more secure feeling.
But when unlocking on-chain liquidity is different, $BTC is still under their control, on the other hand they can still exploit profits on that asset.
That's why I said unlocking on-chain liquidity for BTC will gain attention, especially from Bitcoin whales.
At present there are several methods to build an on-chain DeFi ecosystem for Bitcoin including:
• Build new extension layers for Bitcoin (EVM & non-EVM) and continue to build the DeFi ecosystem on top of it.
• Build a bridge layer to move BTC to existing DeFi ecosystems (Ethereum, Solana, Cosmos).
• Build a DeFi ecosystem directly on Bitcoin (Runes).
Each method has its own advantages and disadvantages, but all of them are helping Bitcoin become more applicable and generate more income for miners, especially in the context that block creation rewards are about to be halved when the second halving occurs. 4 is near.