How do you feel about the BTCFi narrative?

The narrative is a type of I'm waiting for the subsequent rally and the reason is fairly simple.

Bitcoin is by far the most important crypto asset, yet solely a tiny proportion of it is truly being used in DeFi. If native BTC can turn out to be usable for staking, lending, and collateral with out introducing unacceptable custody or bridge danger, the addressable market is gigantic.

However there's additionally an issue, and that's the truth that a variety of the early BTCFi progress was built around wrappers, bridges, and yield merchandise. That works till you start asking whether or not an institution holding billions in BTC truly needs these further trust assumptions.

We've seen the sector develop shortly, however we've additionally seen TVL contract sharply when incentives disappear or danger becomes clearer. So I'm less involved in headline TVL and extra taken with whether BTCFi can develop sustainable credit score markets around BTC itself. If that happens, I feel the narrative has legs, if not, it in all probability stays one other cycle the place the thought was greater than the precise usage.

What do you assume will happen with this narrative sooner or later?