Why are rumors of Bitcoin's financial future being greatly exaggerated?
Welcome to the future, where, as some crypto seers on Twitter claim, BTCFi is already dead. The corpse hasn't even cooled, and farewell DeFi parade trinkets are already being sold on OpenSea. Why? Because Babylon, the 'messiah of BTCFi,' hasn't sparked any fireworks in the market. What a pity.
But let's take a pause. Breathe out. This is not CNBC. We're talking about numbers, facts, and common sense.
First of all, Babylon is not Dogecoin on steroids.
This is infrastructure. It doesn’t have to 'pump' 200% on the first day like a new Elon Musk coin. It allows locking BTC in the main network and participating in securing other level 2 networks. It doesn't sound as sexy as 'X100 to the moon,' but this is how the foundation of future crypto-economics is built.
However, the demand for these consensus services is currently... let's say, unimpressive. The B2B segment is yawning. Institutions keep asking, 'Where can we profit?' But don't rush to turn off the life support for BTCFi.
The real breakthrough is BitVM2.
Yes, we know, it sounds like the name of some failed cyborg from 'Terminator 5.' But what's the essence? BitVM2 allows computations to be performed off-chain and verified in Bitcoin without a single modification to the main code. No hard forks, no drama, just good old consensus.
Unlike OP_CAT — which requires changes to BTC OpCodes (and, accordingly, sends core developers into existential dread) — BitVM2 uses Optimistic Challenge Proofs. Essentially: you claim you've done everything right, and if someone doubts it — an on-chain verification takes place. Just like with the tax office, but faster and without the threat of prison.
Numbers? Of course.
• By 2024, less than 0.1% of all DeFi operations had been 'completed' in BTC.
• In Ethereum — over $50 billion TVL.
• In BTCFi — the cat has cried.
But! Behind BTC is trillion-dollar capital, especially after the ETF launch. Even 1% of its entry into the effective BTCFi economy is $10 billion in liquidity. And guess who is first in line for this money? Whoever offers a sustainable passive income model for BTC holders.
And this is where the real drama begins.
Half of the BTCFi projects are old acquaintances from the 2017 ICO: new tokens, generous promises, zero economy. But the market is getting smarter. People no longer want 'air.' They want real fees, real staking income, real liquidity. A model where L2 networks redistribute part of the fees back to BTC stakers — that's what could blow up the market. Not memes, but the economy.
The bottom line? BTCFi is not dead. It just stepped out for a smoke.
It's coming back. With new ideas, new code, and — if they survive — new tokens. As always, it's not the loudest that survive, but the most useful. And for those who are already burying BTCFi — don't forget to keep the store receipt for the wreaths. It will come in handy for apologies.
