In a groundbreaking move, Sui, the high-speed Layer 1 blockchain, has announced its exclusive support for Stacks (sBTC), the leading Bitcoin DeFi protocol. This integration marks a pivotal step in unlocking the full potential of Bitcoin (BTC) for decentralized finance (DeFi).
Stacks is recognized for its one-to-one asset, sBTC, which is backed by Bitcoin, in contrast to Stacks (STX), which forms the basis of smart contracts on Bitcoin’s Layer 2. This partnership aims to transform BTC, shifting it from a passive store of value to a trustless and productive financial asset within the rapidly growing DeFi services.
The integration of sBTC onto Sui eliminates the need for centralized custodians or hot wallets, allowing services like lending, borrowing, and trading of Bitcoin to be accessible on a scalable and composable infrastructure. Moreover, the decentralized nature of the Stacks network permits the Sui Foundation to function as a validator, highlighting the collaborative aspect of the partnership.
“[sBTC on Sui means] sBTC holders can earn yield, participate in DeFi, and stay true to Bitcoin’s trustless ethos—all on Sui, a blockchain built for performance and scale,” says Greg Glassner, Co-Founder and CPO of Mysten Labs.
Earlier this year, the integration of sBTC with several protocols was announced at the time of Heartwood. By the end of 2024, the BTCfi protocols are expected to have a packed value of $6.5 billion, showcasing the growing demand for Bitcoin DeFi. However, the integration of DeFi activity has been hampered by Bitcoin’s architecture.
Without altering the core of Bitcoin, Stacks has focused on unleashing the abilities of smart contracts, while another layer of utility is added by the high-performance and object-centric blockchain of Sui. This blockchain is supported by Move programming and parallel execution to back everything from DEXs to liquid staking, leveraging low-cost and high-speed transactions.
Already ranked in the top 10 for total value locked and top 6 for DEX volume, the Sui Foundation is becoming a natural hub for Bitcoin liquidity. This momentum is further sped up by the introduction of sBTC. With this advancement, both users and developers can access decentralized and powerful BTC-based applications. In this way, Sui, by partnering with Stacks, is setting the stage for a new era of opportunities for Bitcoin in DeFi.
