Bitcoin Decentralized Finance (BTCFi) has experienced an incredible increase of 278,287% over the last year, driven by a heightened positive sentiment towards the asset. Long-term holders of Bitcoin have amassed a total of 2,000,290 BTC since February 2023, leading to an overall holding of 277 million BTC. A recent research report from Binance indicates that Bitcoin-based Decentralized Finance (BTCFi) has grown by over 2,126.21% within the same period. The report indicates that the Total Value Locked (TVL) has achieved a remarkable figure of $8.6 billion, showcasing its functionality as more than just a typical “store of value,” but as an asset that generates yield. Source: Binance Research. Binance noted that the DeFi activities related to Bitcoin could substantially increase, spurred by a potential rate cut that may enhance market sentiment. At the same time, the ongoing expansion of the BTCFI sector is expected to create new possibilities for holders through liquidity provision and various DeFi mechanisms. A representative from Binance stated that while these opportunities are unavoidable, it is still too soon to gauge their complete effect. He also thinks that the changing market might boost the demand for the asset, which could affect its price. This shift could alter the perception of BTC, transitioning it from merely a passive store of value to a more active on-chain asset. Although it’s premature to assess the complete effects, these developing applications may facilitate wider acceptance and ultimately enhance demand. Interest in BTCFi began to surge following the Bitcoin halving in April 2024. During that period, Babylon introduced the initial Bitcoin staking, and Hermetica debuted the first synthetic dollar supported by Bitcoin. In January, Babylon dominated Bitcoin DeFi expansion, accounting for 80% of total value locked (TVL), as highlighted in our previous news report. Additionally, Bitcoin (BTC) long-term holders have been increasing their holdings.
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