Opinion: Matt Mudano, CEO of Arch Labs
As a result, Ethereum is fighting and decentralized finances (DEFI) suffers. Layer 2 (L2) solutions broke liquidity, which makes capital ineffective. In search of more green pastures, the community turned to Solana-only to find the Memecoin powered ecosystem, powered by pump and pride schemes, attracting liquidity extractors and transforming the chain into a playground for speculation and fraud.
DEFI needs reset, which returns to the first rules and adapts to the original vision of the decentralized Satoshi financial system. The only network capable of maintaining the next Def evolution is not Ethereum or Solana. It’s Bitcoin.
DEFI is fighting for ethereum
Ethereum was once the undisputed DEFI house, but today it is clear that the ecosystem is fighting. The road map of the network is constantly changing, without a clear path to long -term sustainable development.
L2 solutions were to scale Ethereum. Instead, they broke DEFI for insulated liquidity silos. While L2 has reduced transaction fees, they now compete for liquidity, and do not contribute to a unified financial system. Result? A delicate landscape that makes it improper capital and Defi protocols more arduous to scale.
The proposed Ethereum solution – chain abstraction – sounds promising in theory, but it fails in practice. The basic issue is the structural disposal of incentives, as a result of which Ethereum gradually loses its competitive advantage in DEFI.
Time to ask: can Defi’s future lie in a crushed Ethereum?
Solana is not an answer
When Ethereum loses their competitive advantage, many programmers and users turned to Solana. Blockchain recorded a 83% enhance in programmers’ activity year on year, and his decentralized exchanges (DEXS) have exceeded Ethereum for five consecutive months.
There is a basic problem: the growth of Solana DEFI is not based on balanced financial applications – it is driven by Memecoin.
A recent enhance in activity is not powered by innovations in decentralized finances, but by speculative transactions. After the madness, Trump Memecoin, the total separate value from Solana Memecoins ranged from 3.6 to 6.6 billion dollars. This is not a Defi increase-it is a liquidity extraction engine in which short-term speculators earn and go on.
Solana has real strengths. Its speed and low transaction costs make it ideal for high -frequency trade, and the ecosystem has made significant progress in decentralized physical infrastructure networks (Depin), AI and decentralized science or board. But the dominance of Memecoin speculation turned the chain into a playground for fraud and pumps and pumps. This is not the foundation needed by def.
Solana is not an answer if the goal is to build a lasting financial system.
Bitcoin def is flourishing
It’s time to return to the first rules and build DEFI on the original blockchain: Bitcoin – the most trusted, decentralized network supported by the weakest money in the digital economy.
This is not just theoretical. Bitcoin DEFI is already experiencing explosive growth. Consider the number: The total blocked value (TVL) in Bitcoin DEFI increased from $ 300 million at the beginning of 2024 to $ 5.4 billion as of February 28, 2025 – stunning enhance by 1700%. The Bitcoin stacking sector dominates, with protocols such as Babylon ($ 4.68 billion TVL), pawnshop ($ 1.59 billion) and Solvbtc ($ 715 million). This shows the growing demand for bitcoins to become a productive resource, not a passive value storage.
Last: Bitcoin DEFI occupies a central place
Bitcoin-Native Defi not only copies the Ethereum-Pionierskie textbook modern financial models. Progress in space introduced double rates, enabling users to put Bitcoin (BTC) together with native tokens to enhance security and earn. Meanwhile, an pioneering approach to tokenization Hashrate Bitcoin turns mining power into securing loans, borrowing and pond, additionally expanding Bitcoin financial utility.
In addition, BRC-20 boards and tokens caused a record transaction activity, and the inscriptions reached 66.7 million and generated $ 420 million fees-converting the growing demand for tokenized assets on bitcoins.
It is obvious that Bitcoin is no longer just digital gold – it becomes the basis of the next phase of decentralized finances.
The future of DEFI is on Bitcoin
The future of DEFI is in Bitcoin, where encouragements are in line with the long -term creation of values. In contrast to the fragmented Ethereum model and the Solana speculative economy, Bitcoins based on Bitcoins are based on fluidity and sustainable development of the institutional class.
As the largest and most liquid cryptographic assets, Bitcoin has $ 1.7 trillion market capitalization and $ 94 billion in the stock exchange fund (ETF). Even a fraction of this fluidity migrating to DEFI would be a breakthrough. Bitcoin has over $ 1 trillion of unused liquidity and continues to attract great interest of institutional investors and sovereign property funds, and governments are already investigating them as a potential reserve resource.
Several projects are already built on bitcoins, building a balanced ecosystem in which users can store the most trusted digital resources, while creating productivity through DEFI mechanisms.
Ethereum had his moment. Solana had her noise. This is the turn of Bitcoin to realize the original vision of Satoshi decentralized financial system.
Opinion: Matt Mudano, CEO of Arch Labs.
This article is used for general information purposes and should not be and should not be treated as legal or investment advice. The views, thoughts and opinions expressed here are themselves and do not necessarily reflect or represent the views and opinions of Cointelegraph.
