2024 is the breakthrough year for Bitcoin, attracting over $100 billion in institutional buyers. However, the Bitcoin DeFi space remains undeveloped, still a 'fertile ground.'
As more major institutions adopt Bitcoin and the Bitcoin DeFi ecosystem continues to develop, 2025 will witness significant prosperity in Bitcoin DeFi.
1. The immense potential of Bitcoin staking.
The Bitcoin staking market shows tremendous growth potential. According to DeFiLlama, by the end of 2024, the total locked value (TVL) will reach $6.55 billion.
Bitwise research head Matt Hougan stated:
The market has all the conditions for Bitcoin staking businesses to take off. Even a modest yield of 3% is extremely attractive compared to traditional investment channels.
Hogan predicts that this market could grow to $200 billion.
Build on Bitcoin co-founder and CEO Alexei Zamyatin gave a bolder prediction, suggesting that Bitcoin DeFi TVL could expand 300 times in the near future.
We have engaged with many investors and large funds who are eager to leverage Bitcoin for returns.
He shared.
2. Institution and government-driven investments.
2024 is a historic milestone, as Bitcoin breaks the $100,000 threshold, attracting over $100 billion into Bitcoin ETFs.
Agoric Network CEO Dean Tribble commented:
This record-breaking price will attract more institutions and regulators, driving further development of the entire crypto industry by 2025.
Protocols such as Babylon (Bitcoin network staking) and EigenLayer (re-staking WBTC on Ethereum) are leading this trend, with TVLs of $5 billion and $15 billion, respectively. Additionally, Europe has launched a Bitcoin staking ETF, offering an attractive 5.65% annual interest rate, creating new opportunities for institutional investors.
3. The DeFi ecosystem is maturing.
Bitcoin's liquid staking tokens (LST) are gaining attention, with total locked value (TVL) reaching $2.5 billion. Second-layer platforms like RSK, Merlin, and Stacks have established a comprehensive DeFi ecosystem, offering a wide range of services from decentralized trading to lending.
Lombard co-founder Jacob Phillips emphasized:
We will see an evolution from simple strategies (such as earning returns through holding Bitcoin) to more complex trades (such as options trading). Bitcoin staking yields could become a new market benchmark and potentially replace U.S. Treasury bonds in the DeFi lending space.
