Binance: "Bitcoin DeFi Has Potential for Billions in Liquidity"

# Binance: Leveraging Bitcoin in DeFi Could Generate Billions in Liquidity Binance has projected that utilizing Bitcoin (BTC) within decentralized finance (DeFi) could create billions of dollars in liquidity. According to a report by Decrypt on October 14, Binance emphasized in its report that employing Bitcoin in DeFi protocols is an "untapped opportunity," providing Bitcoin holders with avenues to more actively use their assets. Currently, the report highlights, only about 0.79% of Bitcoin is being used within DeFi. Originally developed for swift and secure global transactions, Bitcoin is now often seen as a 'digital gold' hedge against inflation, particularly with the recent approval of spot ETFs in the United States. Many investors are holding Bitcoin for extended periods, anticipating price appreciation. However, Binance argued that incorporating Bitcoin into DeFi could yield more substantial returns than merely holding it. The report outlined that while Bitcoin's architecture wasn't initially designed to support complex financial applications, it can be used in DeFi in several ways: as collateral, for generating income through lending, or by participating in structured products. With the U.S. Securities and Exchange Commission (SEC) adopting more crypto-friendly policies, Binance expects DeFi development to accelerate. The advent of DeFi applications compatible with Bitcoin could allow the cryptocurrency to be used more productively in financial markets. Nevertheless, the DeFi market comes with high risks, including frequent hacks and scams, which have caused significant investor losses. Binance stressed that unlike typical DeFi users, Bitcoin holders prioritize security and long-term value preservation. Therefore, BTCFi (Bitcoin-based DeFi) applications must cater to these preferences. Binance concluded that if the ongoing protocol developments succeed, DeFi’s expansion with Bitcoin will be inevitable. By leveraging Bitcoin's security and stability, BTCFi could emerge as a key sector within the financial market.