As the Dubai Token2049 conference concludes, one of the most important takeaways is that the narrative of Bitcoin (BTC) is quickly expanded beyond its traditional role as a value of value to a potential defi asset competing with Ethereum and Solana.
Prominent industry players such as Franklin Templeton consider this development as a positive step, confident that it will improve Bitcoin’s tool without diluting its core appeal as a value of value, such as purists or maximalists fear.
“I don’t think focusing on Bitcoin Defi will dilute or complicate Bitcoin’s core narrative,” explained Kevin Farrelly, who manages the principal of Blockchain -Fventure Capital at Franklin Templeton and VP for digital assets, under his keynote speaker on the Bitlayer Side Event this week. “Instead, it extends Bitcoin’s tool to a particular type of investor – one with adequate technical sophistication to optimize dividends, security or custom portfolio needs.”
“These users do not replace the ‘store of value’ thesis; they are based on it,” added Ferally. “It’s not narrative dilution, it’s infrastructure development.”
Franklin Templeton is an investor in Bitlayer, a BitVM that acts as Bitcoin’s calculation layer while Mainnet’s security retains. It offers features such as faster transaction processing, lower fees and new functionalities such as smart contracts or advanced defi-integrations, areas that base layer bitcoin alone do not have natives.
Franklin Templeton’s Bitcoin ETF (EZBC) has registered net inflow of $ 260 million since its debut on January 11 last year. From May 1, the Fund held 5,213 BTC, more than $ 500 million in assets under management at Bitcoin’s current price just over $ 97,000.
Extension beyond the store with value appeal
Satoshi Nakamoto’s original vision for Bitcoin Blockchain was driven by creating a decentralized financial system that promotes economic sovereignty and privacy, eliminating the need for transaction intermediaries. However, over a decade since its inception, blockchain’s original cryptocurrency, Bitcoin, has quickly gained a reputation as a digital gold – a reliable value – and this tale has served well.
Bbitcoin’s market capital today exceeds $ 1.9 trillion and accounts for almost 60% of the total market value of digital asset at $ 3.12 trillion per year. Coindesk -Data. It is the most fluid cryptocurrency that is on average several billion dollars in daily trading volumes around the world, and several publicly listed companies have adopted it as a reserve asset.
In addition, several regulated alternative investment vehicles have been tied to BTC over the years, allowing traditional market participants to take exposure to cryptocurrency.
For example, according to the data source Farside, the 11 Spot -Tfs, which are listed in the United States, have raised nearly $ 40 billion in investor money since their debut last January. Meanwhile, Ether ETFs have seen net inflow of just under $ 3 billion.
The strong institutional recording for BTC has been widely attributed to its simple, compelling narrative as a digital gold – an asset that is easy to understand in relation to complex platforms such as Ethereum or Solana, which supports a wider range of decentralized financing uses (DEFI) and use cases, which helps their original token holders to earn additional exploits at the top of their spot.
“At the core, it is seen as a digital value of value,” Farrelly told Coindesk. Unlike more complex crypto projects, Bitcoin does not require a deep technical explanation – it has a clear, focused purpose. This clarity can be part of what makes it easier to understand, easier to model, and with ETF, easier to assign. “” In a landscape full of complexity and speculative tales, Bitcoin offers a kind of signal – and what is increasingly resonating, “he continued .. He continued ..
As a result, many purists withstand the idea of introducing features similar to Defi directly on Bitcoin Blockchain, in fear that it could dilute Bitcoin’s core appeal.
Buzz around Bitcoin Defi at the Bitlayer event and Main Token2049 conference was tangible, highlighting the growing demand among BTC holders on additional yield options.
“Bitcoin Defi with confidence minimized bridge, sustainable yield products for onchain Bitcoin holders become very important for Bitcoin activists and networking maintenance,” Charlie Yechuan Hu, co-founder of Bitlayer to Coindesk.
“At Bitlayer we build important infrastructures that can strengthen Bitcoin Defi with our BitVM technologies,” added HU. “A lot of interesting bitcoin defi -use cases can make bitcoin assets more valuable, give users more reason to keep and use in the future”
This BTC Defi tendency could also benefit miners rewarded for mining blocks. While the reward per Block is halved every four years, increased activity on chain driven by defi applications could help offset this reduction through higher transaction fees, supporting the security and sustainability of the network.
“It is important that Bitcoin Defi also introduces new transaction fees-a critical component of the network’s long-term sustainability and security as the block department continues to fall,” Farrelly said.
HU expressed a similar statement saying that the rising network of Hashrate means miners need more activities – such as Bitcoin Defi – to remain profitable.
“We will have to build good Bitcoin -Rollup with security verification capacity, which can contribute fees back to Bitcoin,” HU noted.
