The global cryptocurrency research firm Messari recently reported that Starknet's role is rapidly expanding in the decentralized finance ecosystem centered around Bitcoin, known as 'BTCFi'. In particular, Starknet is accelerating the construction of a comprehensive self-custody economic system that goes beyond simple staking or bridging platforms, encompassing lending, borrowing, yield strategies, and even real-world spending.
The total locked value of Starknet has grown from $155 million to nearly $310 million over the past six months, almost doubling. This is the result of the combined effects of increased bridging of Bitcoin, stablecoins, and the native token STRK staking. In particular, lending protocols like Vesu are complementing staking platforms, attracting user inflows looking to leverage their held BTC as collateral to generate yield. Messari stated that these platforms offer sustainable yields through incentives of up to 100 million STRK, and advanced DeFi yield models, including borrowing and looping strategies, are becoming active.
Users are maximizing returns through arbitrage trading seeking interest rate spreads, utilizing circular strategies with collateral assets, and more. For example, by depositing BTC to borrow USDC and then redepositing it to expand the leverage structure, a higher annualized return can be achieved. On Starknet, various strategies that transform BTC from a purely held asset into a revenue-generating asset have become possible, and these functions are realized within on-chain structures that perform roles similar to traditional financial systems.
In particular, recent products such as the mRe7BTC options strategy based on wrapped BTC launched by Re7 Capital have attracted significant attention. This strategy offers about a 20% yield, exceeding the yield levels of existing BTCFi. The same report noted that such high-yield products are drawing in more mature investors, further enhancing the practicality and economic utilization of BTC assets.
At the same time, Starknet continues to make progress on the technical front. The introduction of the new proof engine S-TWO based on STARK proofs has increased processing speed and looks towards future verification integration with the Bitcoin chain. Based on this, Starknet has opened the possibility of using Bitcoin as its Layer2 scaling solution verification hub, in addition to Ethereum. This is interpreted as a strategy aimed at enhancing Starknet's cross-chain compatibility and decentralized security.
Alongside these technological advancements, services that enhance the actual user experience are also rapidly expanding. For example, the wallet 'Ready' based on Starknet is recently transforming into a digital bank to expand into user-centered financial services. Ready supports users to deposit assets and make purchases without going through centralized exchanges via fiat deposit channels, virtual IBAN integration, and the launch of self-custody debit cards. STRK rewards obtained through BTC staking can now be directly used for actual coffee or living expense payments via the Ready card. This is seen as a practical case of connecting decentralized financial systems to real-life applications.
These comprehensive changes indicate that the system is transcending a purely capital inflow-centered DeFi system, moving towards a direction that emphasizes practical utility based on behavior. The Messari Research Institute commented in a report that Starknet is likely to position itself as 'the first comprehensive Layer2 platform in the BTCFi ecosystem that provides a complete closed loop from staking, borrowing, yield realization to fiat expenditure.'
Ultimately, Starknet is redefining Bitcoin from digital gold to an asset that creates economic value, which is expected to have a significant impact on the entire BTCFi market in the future.
