Plume also appears to be aiming to unlock BTC liquidity. As expected, everyone has seen the waste of sitting idle with a massive amount of BTC as "digital gold."
However, compared to previous BTCfi projects, Plume's approach is to achieve sustained BTC-denominated returns through a combination of RWA and BTC. This perspective is indeed more appealing to institutions than its predecessors, who focused on reaping the benefits of native crypto returns within the industry.
As BTC gradually shifts from retail investors to institutional investors, convincing them to stake their BTC for interest is a complex task. After all, for miners and retail investors, as long as DeFi APYs are high and the promotion is effective, they won't care much about compliance issues.
However, expecting funds and institutions to do this is unrealistic. They primarily need long-term, sustainable operations (such as ETH staking), with clear revenue streams (with restructuring externalities) and compliant processes. This is likely what Plume is aiming to achieve:
Plume has built-in regulatory alignment, including custody, KYC/AML, and transparent legal frameworks, to mitigate systemic risk. Partners like Fireblocks provide institutional-grade access, ensuring third-party security and audits when BTC is injected into RWA.
Furthermore, RWA can be exchanged for real-world economic activity contracts, such as fixed interest on corporate loans or periodic payments on structured debt. This type of income is much more stable and predictable than project token subsidies, and the potential for scale is much greater (in the billions).
The story is plausible, but actual implementation requires case-by-case analysis. If Plume can truly build some impressive prototypes, the price of the token remains high.
However, it's much easier said than done, so I'll mark it for now and wait and see.
