Bitcoin DeFi Movement Aims To Transform Digital Gold Into Active Asset

HomeNews* Industry leaders expect DeFi to transform Bitcoin into an active financial tool beyond a store of value.

  • Speakers at the Bitcoin 2025 conference highlighted new projects and technologies expanding DeFi capabilities on Bitcoin.
  • Security, self-custody, and trustless systems remain core features of Bitcoin-based DeFi initiatives.
  • Layer 2 solutions, staking, and sidechains are being developed to boost Bitcoin’s role in decentralized finance.
  • Advocates see Bitcoin DeFi supporting financial access in regions with inflation and restrictive currency controls. Prominent figures from the Bitcoin community gathered at the 2025 Bitcoin conference in Las Vegas to discuss how decentralized finance (DeFi) could shift Bitcoin from just a passive store of value to a direct competitor with traditional finance. The event brought together developers and entrepreneurs working on expanding Bitcoin’s technical capabilities for new DeFi uses.
  • Advertisement - Projects such as the Liquid Network and several growing Bitcoin DeFi companies presented tools aimed at enabling peer-to-peer financial services without intermediaries. Jacob Phillips, co-founder of Lombard Finance, described Bitcoin DeFi as a way to make Bitcoin an active part of a trustless financial system. Lombard offers LBTC, a liquid staking token, allowing users to stake their Bitcoin on the Babylon blockchain to earn yields and participate in DeFi lending or trading—even outside the original Bitcoin network.

Adrián Eidelman of RootstockLabs said Layer 2 (L2) technology can add smart contract features to Bitcoin, expanding its role in decentralized applications while preserving security. He reported that Rootstock’s merged mining—a process linking security across blockchains—reached record levels in early 2025. Charlie Hu of Bitlayer stressed the need to keep finality and security on Bitcoin’s main network rather than relying too much on secondary chains.

Blockstream CEO Adam Back said Bitcoin-based DeFi applications may soon offer competitive borrowing rates and liquidity compared to traditional finance. He explained that, with layer 2 integration, users could earn yields by staking Bitcoin in decentralized systems, maintaining lower fees and stronger privacy. Yves La Rose of Vaulta and Joseph Kelly of Unchained both emphasized the importance of self-custody, giving users direct control of their assets.

Rich Rines of Core DAO described this phase as a shift toward giving practical utility to Bitcoin, while Eidelman pointed to regions like Argentina as examples where Bitcoin DeFi helps people bypass inflation and controls through dollar-backed stablecoins—while using Bitcoin as collateral.

Throughout the conference, speakers agreed that the future of finance built on Bitcoin will stress transparency, user control, and decentralized infrastructure, shaping a system where Bitcoin is more than a digital asset.

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