A recent report by global cryptocurrency research firm Messari Research explains the rapidly expanding role of Starknet in the Bitcoin-centric decentralized finance ecosystem, known as "BTCFi." In particular, Starknet is accelerating its efforts to build a comprehensive self-custody economic system that encompasses lending, borrowing, yield strategies, and even real-world spending, moving beyond simple staking and bridge platforms.
Starknet's total value locked (TVL) has nearly doubled from $155 million to $310 million over the past six months. This is a result of a combination of increased staking of bridged Bitcoin (BTC), stablecoins, and the native STRK token. Lending protocols like Vesu, in particular, are complementing staking platforms, attracting users seeking to generate yield by collateralizing their BTC holdings. According to Messari Research , these platforms offer sustainable yields through incentives worth up to 100 million STRK, and advanced DeFi yield models, including borrowing and looping strategies, are gaining traction.
Users are maximizing profits through carry trades that exploit interest rate differentials and looping strategies utilizing collateralized assets. For example, a structure that deposits BTC to borrow USDC and then redeposits it to increase leverage can achieve a high APY. Starknet thus enables a variety of strategies that transform BTC from a simple holding asset into a yield-generating one, and these functions are implemented on-chain, similar to traditional financial systems.
Wrapped BTC-based options strategies, such as mRe7BTC, introduced by Re7 Capital, have recently attracted significant attention. This strategy offers returns of approximately 20%, exceeding existing BTCFi returns. According to the same report , these high-yield products are attracting more sophisticated investors and further increasing the practicality and economic utility of BTC assets.
Meanwhile, Starknet is also making steady progress on the technical front. The introduction of S-TWO, a new proof engine based on STARK proofs, promises increased processing speed and even envisages future verification integration with the Bitcoin chain. Based on this, Starknet is open to the possibility of leveraging Bitcoin as a verification axis for its L2 scaling solution, in addition to Ethereum. This is interpreted as a strategy aimed at simultaneously enhancing Starknet's cross-chain compatibility and decentralized security.
Along with these technological advancements, services that enhance the actual user experience are also rapidly expanding. A prime example is the Starknet-based wallet "Ready," which recently rebranded as a neobank and is expanding into user-centric financial services. Ready enables users to deposit and spend assets without going through a centralized exchange by offering fiat onramps, virtual IBAN integration, and the launch of a self-custody debit card. Users can now directly use the STRK rewards earned through BTC staking to pay for coffee or other living expenses through the Ready card. This is a notable example of how decentralized finance systems are being integrated into everyday life.
This comprehensive shift demonstrates a shift beyond a DeFi system focused solely on capital inflows toward behavior-based, practical utility. Messari Research stated in a report that Starknet is likely to establish itself as "the first complete Layer 2 platform in the BTCFi ecosystem, offering a complete loop from staking and borrowing to yield and fiat spending."
Ultimately, Starknet is redefining Bitcoin from digital gold to an asset that generates economic value, a move that could have a significant impact on the overall BTCFi market going forward.
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