NEWSLETTER
Opinion of: Matt Mudano, CEO of Arch Labs
ethereum is fighting, and as a result suffers decentralized finances (defi). CAP-2 (L2) solutions have fractured liquidity, which makes capital inefficient. In search of more ecological pastures, the community has resorted to Solana, just to find an ecosystem driven by memecoin fed by pump and diver schemes, attracting liquidity extractors and turning the chain into a patio of recreation to speculate and fraud.
Defi needs a restart that returns to the first principles and is aligned with the original vision of Satoshi of a decentralized financial system. The only network capable of maintaining Defi's next evolution is not ethereum or Solana. It's bitcoin.
Defi is fighting ethereum
ethereum was once the undisputed home of Defi, but today it is clear that the ecosystem is fighting. The network of the network constantly changes, without a clear path to long -term sustainability.
L2 solutions would be supposed to climb ethereum. Instead, I have fractured defi in isolated liquidity silos. While L2S have reduced transaction rates, now compete for liquidity instead of contributing to a unified financial system. The result? A fragmented landscape that makes capital inefficient and protocols define more difficult to climb.
The solution proposed by ethereum, the abstraction of the chain, sounds promising in theory but fails in practice. The fundamental problem is a structural misalignment of incentives and, as a result, ethereum is gradually losing its competitive advantage in Defi.
It's time to ask: Can the future of defi lie in a fragmented ethereum?
Solana is not the answer
With ethereum losing their competitive advantage, many developers and users have resorted to Solana. The block chain has seen an 83% increase in the activity of the developer year after year, and its decentralized exchanges (DEX) have surpassed ethereum for five consecutive months.
There is a fundamental problem: the growth of Defi de Solana is not based on sustainable financial applications, a memecoin frenzy feeds it.
The recent increase in activity is not driven by innovation in decentralized finances, but by speculative trades. After the madness of Trump Memecoin, the total value extracted from the Solana memecoins varied between $ 3.6 billion and $ 6.6 billion. This is not a defi growth: it is a liquidity extraction engine where short -term speculators charge and continue.
Solana has real strengths. Its speed and low transaction costs make it ideal for high frequency trade, and its ecosystem has made significant advances in decentralized physical infrastructure networks (Depins), ai and decentralized science, or decrease. But the mastery of Memecoin's speculation has turned the chain into a recreation courtyard for fraud and bomb schemes. That is not the defi Foundation needs.
Solana is not the answer if the objective is to build a durable financial system.
bitcoin Defi is thriving
It is time to return to the first principles and build defi in the original block chain: bitcoin, the most reliable decentralized network backed by the most solid money in the digital economy.
This is not just theoretical. bitcoin Defi is already experiencing explosive growth. Consider the numbers: Total Blocked Value (TVL) in bitcoin Defi increased from $ 300 million to early 2024 to $ 5.4 billion as of February 28, 2025, an amazing increase of 1,700%. The bitcoin Reading sector is dominating, with protocols such as Babylon ($ 4.68 billion TVL), Lombard ($ 1.59 billion) and SOSVBTC ($ 715 million) leading the position. This demonstrates bitcoin's growing demand to become a productive asset instead of a passive value store.
Recent: bitcoin Defi takes the center of the stage
bitcoin-Native Defi is not simply copying ethereum's play, he is a pioneer of new financial models. Advances in space have introduced a double bet, allowing users to bet on bitcoin (btc) together with native tokens to improve security and gain yields. Meanwhile, the novel approaches to Tokenize bitcoin's hashrate convert the mining power into guarantee for loans, loans and bets, further expanding bitcoin's financial utility.
In addition, ordinals and BRC-20 tokens have promoted the activity of record-high transaction, with inscriptions that reach 66.7 million and generate $ 420 million in rates, highlighting the growing demand for tokenized assets in bitcoin.
It is clear that bitcoin is no longer just digital gold, it is becoming the base of the next phase of decentralized finance.
Defi's future is in bitcoin
Defi's future meets bitcoin, where incentives are aligned with the creation of long -term value. Unlike the fragmented ethereum model and Solana's speculative economy, defi based on bitcoin is based on institutional degree and sustainable growth liquidity.
As the largest and most liquid cryptographic asset, bitcoin has a market capitalization of $ 1.7 billion and $ 94 billion in background holdings (ETF) listed in the stock market. Even a fraction of this liquidity migrating to Defi would be a change of play. bitcoin has more than $ 1 billion in non -exploitation liquidity and continues to attract a strong interest of institutional investors and sovereign wealth funds, and governments already explore it as a possible reserve asset.
Several projects are already being based on bitcoin, building a sustainable ecosystem where users can have the most reliable digital asset while making it productive through defi mechanisms.
ethereum had its moment. Solana had her exaggeration. It is bitcoin's turn to update Satoshi's original vision of a decentralized financial system.
Opinion of: Matt Mudano, CEO of Arch Labs.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The points of view, the thoughts and opinions expressed here are alone of the author and do not necessarily reflect or represent the opinions and opinions of Cointelegraph.
