- Starknet has unveiled plans to choose Bitcoin and Ethereum.
- Crypto VC companion believes that BTC DeFi has a large development potential.
Starknet [STRK] seeks to unify and provide settlement on Bitcoin [BTC] and Ethereum [ETH], a primary of its sort if achieved this 12 months. A part of its assertion read,
“Starknet will turn into the primary L2 to choose each Bitcoin & Ethereum, bringing the 2 largest blockchain ecosystems on a single layer, unlocking new DeFi alternatives and better liquidity.”
The ETH L2 scaling answer added that it is likely one of the most cost-effective L2s and would carry low-cost transactions to unlock BTC DeFi potential.
Because of this, it could place itself as BTC’s ‘execution layer’ for DeFi actions like lending, borrowing, staking, and so forth.
BTC DeFi potential
Notice, nonetheless, that there are different BTC scaling options, together with Stacks, Lightning Community, BitVM, and BitcoinOS. As of early 2025, BTC TVL (complete worth locked) on its DeFi was about 68K BTC or $5.3B.
The TVL hit an all-time excessive of 73.2K BTC in January 2025. For comparability, that was a comparatively small 4K BTC drop in Q1 2025.
When zoomed out from final December, BTC DeFI TVL grew from 48K BTC to just about 70K BTC, translating to 43% development.
It bolstered investor confidence in BTC DeFi, which was presently dominated by staking platforms Babylon, Lombard, SolvBTC, and fee supplier Lightning Community.
Supply: DeFiLlama
Curiously, the elevated curiosity in BTC DeFi may increase the TVL even additional.
In keeping with Dan Held, a crypto VC at Uneven and BTC DeFi investor, the sector has the largest untapped potential and will explode to a $300 trillion market measurement. He stated,
“If DeFi may very well be unlocked on Bitcoin, it could be by far the largest alternative ever to occur in crypto.”
On the Starknet replace, Held termed it as ‘large’ for BTC DeFi development and mindshare.
In a separate interview with the Provide Shock podcast, Held projected that BTC DeFi development may eat Ethereum and Solana’s market share.
“I believe what’s going to occur is that this simply absorbs market share from the opposite ones considerably, however not completely, and that this will increase Bitcoin’s dominance.”
Within the meantime, Starknet plans to make use of federated bridges to carry Bitcoin property to its platform because it waits for OP_CAT, a delicate fork that goals to boost the Bitcoin community’s good contract capability.
It stays to be seen how the DeFi renaissance would trickle all the way down to BTC’s worth on value charts.
