Key Highlights:
- Ethereum layer-2 Starknet, in partnership with BTC wallet Xverse, plans to offer a “complete DeFi experience for Bitcoin users.”
- This partnership emerges during heightened interest in leveraging Starknet for Bitcoin scalability.
- Developers are investigating how to utilize Bitcoin’s substantial security and resources to enhance the wider DeFi and blockchain ecosystem.
One of the leading projects attempting to enhance the efficiency of the Ethereum network is intensifying efforts on Bitcoin, the original blockchain.
Starknet, in collaboration with Xverse, is set to provide a DeFi experience tailored for Bitcoin users.
Xverse has announced plans to realize Bitcoin’s DeFi breakthrough through integration with Starknet in Q2 2025 in a recent communication.
The partnership comes during a surge in Bitcoin scalability research utilizing Starknet. The Starknet Foundation unveiled a new Bitcoin Roadmap that details Starknet’s ongoing support for Ethereum while positioning itself as Bitcoin’s execution layer, aiming to scale from 13 TPS to thousands.
Moreover, developers are increasingly examining how to harness the inherent security and substantial reserves of BTC to empower the broader DeFi landscape. The challenge lies in addressing Bitcoin’s relative lack of programmability compared to Ethereum and other networks. Layer 2 solutions such as Starknet aim to fill this gap by functioning as an execution layer, handling transaction processing, with finality achieved through Bitcoin settlement.
A pivotal element that remains outstanding is OP_CAT, a suggested enhancement to the Bitcoin network that may unlock unprecedented programmability critical for DeFi services. This implementation could also facilitate zero-knowledge proofs, a cryptographic method that validates statements without revealing sensitive information.
Despite uncertainty surrounding OP_CAT’s future as a Bitcoin improvement proposal (BIP), Starknet and Xverse are determined to actualize Bitcoin DeFi even in its absence. Xverse is focused on delivering a Bitcoin DeFi experience with trust assumptions as the next major advancement until OP_CAT is adopted.
“Certainly, the ultimate goal is trustless DeFi on Bitcoin,” stated Ken Liao, the founder of Xverse, during the announcement on Tuesday. “This will still feature some ’training wheels’ of trust assumptions, but it’s undeniably thrilling to present the clearest preview to date of what seamless DeFi on Bitcoin will entail and feel like.”
For more details, visit CoinDesk.
