The value locked in Bitcoin-based decentralized finance (BTCFi) has surged by more than 2,700% over the past year, potentially transforming Bitcoin from a passive store of value into a productive, yield-bearing asset, according to new research from Binance. BTCFi is a new technological paradigm that aims to bring decentralized finance capabilities to Bitcoin’s base layer. It is one of the fastest-growing crypto sectors, reaching a total value locked (TVL) of over $8.6 billion. The growing value of BTCFi, “along with potential interest rate cuts, may reinforce positive sentiment for Bitcoin in the medium and long term,” Binance Research wrote in a report shared with Cointelegraph. Bitcoin DeFi, total value locked, 2025 chart. Source: Binance Research If the BTCFi sector’s growth trajectory continues, it could open up “new opportunities for Bitcoin holders to generate yield through lending, liquidity provision, and other DeFi mechanisms,” a Binance spokesperson told Cointelegraph, adding: “This may contribute to a shift in how BTC is perceived — from a passive store-of-value to a productive on-chain asset. While it’s too early to determine the full impact, these evolving use cases could support broader adoption and, over time, strengthen demand.” Related: Bitcoin price can hit $250K in 2025 if Fed shifts to QE: Arthur Hayes Interest in BTCFi surged after April 2024’s Bitcoin halving , which introduced the Runes protocol, the first fungible token standard on the Bitcoin blockchain. Several Bitcoin-native projects have helped accelerate the trend. Babylon introduced Bitcoin ( BTC ) staking for the first time in the network’s history, enabling holders to earn passive income from their assets. Hermetica launched the first Bitcoin-backed synthetic dollar , USDh, which debuted with a 25% yield for investors. Related: Crypto trader turns $2K PEPE into $43M, sells for $10M profit BTC long-term holders resume Bitcoin accumulation Long-term Bitcoin holders have restarted their BTC accumulation after the BTC supply held by long-term holders bottomed in February. BTC supply held by long-term holders. Source: Glassnode, Binance Research Long-term holders are wallets that have been holding BTC for at least 155 days. Growing accumulation from long-term holders has reduced the available Bitcoin supply on exchanges, which may eventually lead to a supply shock-driven price rally. The growing accumulation trend among long-term holders aligns with a “significant period of adoption for Bitcoin,” due to the establishment of the US strategic Bitcoin reserve and growing institutional interest, according to the research report. Source: Margo Martin On March 7, US President Donald Trump signed an executive order to create a strategic Bitcoin reserve using BTC seized from government criminal cases. Trump signed the historic Bitcoin reserve order a day ahead of hosting the first White House Crypto Summit , which received mixed reactions from the crypto community. Magazine: Bitcoiner sex trap extortion? BTS firm’s blockchain disaster: Asia Express
