Bitcoin (BTC) is on a bullish trajectory. The cryptocurrency hit a new all-time high of $111,970 on May 22 before quickly retracting to $110,700. The price of BTC is currently hovering around $108,000, yet metrics suggest that Bitcoin is on an upward trend.
Bitcoin bulls predict that the price of BTC may soon rally to $115,000.
Bull Run Advances Bitcoin DeFi
While investors eagerly await another BTC all-time high, industry experts point out that this bull run is different from previous cycles.
Rena Shah, chief operating officer of Trust Machines, told Cryptonews that the recent Bitcoin all-time high has a different momentum compared to the first time BTC went above $100k.
According to Shah, the current Bitcoin bull run is advancing Bitcoin decentralized finance (DeFi) in new ways. For instance, Shah noted that a considerable amount of BTC has recently been locked into sBTC, a 1:1 bitcoin-backed asset secured via the Stacks blockchain.
“The Bitcoin ecosystem has seen more and more BTC bridged, with more than 2,000 BTC recently being locked in Stacks sBTC,” Shah said. “As more users look at the earning opportunities available without selling their Bitcoin, we’ll see a positive surge of building on Bitcoin follow.”
Echoing this, Matt Mudano, co-founder and CEO of Arch Network, told Cryptonews that Bitcoin is no longer just being held by investors.
“In past cycles, the price of BTC surged primarily from speculation and accumulation. But this time, we’re seeing infrastructure mature to actually make Bitcoin productive,” he said.
Mudano attributes this to the rise of Bitcoin layer-2 (L2) networks, along with native smart contract layers such as Arch. He further noted that BTC-backed stablecoins continue to unlock new use cases like lending, structured products, and DeFi built around Bitcoin.
“That’s why we’re seeing more BTC bridged, wrapped, or integrated—not because people want to leave Bitcoin, but because they want to do more with it,” Mudano said. “The $100K narrative isn’t just about scarcity anymore—it’s about utility.”
Bitcoin Becomes Active Capital
New use cases demonstrate how Bitcoin is evolving from a passive store-of-value to a form of active capital in the digital economy.
Mudano pointed out that previously, the only way for users to earn on BTC was to borrow against it or wrap it into Ethereum-based systems. However, these models come with risks such as liquidations, custodial exposure, or exiting from the Bitcoin trust model.
In order to combat these challenges, Mudano explained that Arch allows users to earn yield without selling or borrowing against their BTC. This is accomplished by lending out BTC to protocols that deploy the asset into low-risk structured products or credit strategies.
“Users can provide liquidity to Bitcoin-native decentralized exchanges and perp markets to earn fees from real economic activity,” he said. “Yield is now driven by actual demand, or the need to use BTC as capital in an on-chain economy, just like ETH became valuable by underpinning DeFi.”
Just like Ethereum’s yield came from being the base layer of on-chain finance, Mudano believes that Bitcoin is finally entering that same phase, making this cycle vastly different from other bull runs.
Shah agrees that Bitcoin is an asset that should be used as collateral. She explained that sBTC unlocks Bitcoin DeFi by allowing users to earn yield, access on-chain lending, and trade on decentralized exchanges (DEXs).
For example, protocols like Granite create the opportunity to lend and borrow against Bitcoin without ever having to sell. Launched in September 2024, Granite was incubated by Trust Machines and lets users access DeFi by leveraging Stacks’ recently launched Nakamoto upgrade and sBTC Bitcoin bridge.
Willem Schroe, founder of Bitcoin L2 Botanix, told Cryptonews that Botanix also allows BTC holders to earn without selling their Bitcoin. Schroe believes this trend is gaining momentum in the current bull market.
“This cycle, we’re seeing these use cases go from experimental to real. Live on testnet and soon to launch mainnet in mid-June, we’re already seeing users use pUSD, borrow against BTC, and engage with early DeFi protocols building on top of us,” Schroe commented.
To put this in perspective, Schroe explained that Botanix users can borrow against their BTC. The process involves locking up the asset and then minting a stablecoin like Palladium pUSD (pUSD) on Botanix. This provides liquidity without triggering a taxable event or exiting your position.
Building on Bitcoin Surges
Not only are more people across ecosystems getting interested in using Bitcoin for DeFi, but Bitcoiners who’ve long held their BTC dormant are getting involved in various innovations.
“Momentum always follows capital—and for the first time, we have both flowing into Bitcoin. Past bull runs made people rich off Bitcoin. This one is about building with Bitcoin,” Mudano said.
According to Mudano, several factors are currently converging that allow Bitcoin holders to do more this cycle.
“Ordinals and Runes activity brought a wave of developer interest, but new infrastructure like Arch, Stacks, and others are making Bitcoin programmable without compromising its principles,” he said.
At the same time, Mudano noted that capital markets are finally paying attention to digital assets. “ETFs, institutional strategies, and the realization that BTC can underpin a real financial system is all being seen now,” he said.
Mudano further believes that while the current bull market may pump the price of BTC, the infrastructure wave is turning the narrative into a builder’s cycle.
Shah agrees, as she pointed out that Stacks recently announced an entirely new roadmap, along with the launch of SIP-031. Both of these developments demonstrate a more robust and competitive ecosystem around building on Bitcoin.
Challenges To Consider
While it’s clear that the current bull run is advancing Bitcoin DeFi, a number of challenges remain. For example, Mudano believes that the biggest factor holding back Bitcoin DeFi today is also what makes Bitcoin so powerful—its decentralization.
“There’s no foundation, no core team, no steering committee to dictate how the chain should evolve,” he said. “That means there’s no single roadmap to scaling or programmability. Instead, it’s up to builders—independent teams like ours—to experiment, innovate, and push the boundaries of what’s possible within Bitcoin’s constraints.”
Mudano added that the Bitcoin ecosystem is currently witnessing a wave of experimentation, ranging from covenants, to ZK-rollups, to threshold multisig and custom virtual machines.
Schroe further noted that a lack of native programmability may hold Bitcoin DeFi back.
“Bitcoin wasn’t designed for complex smart contracts,” he said. “Bitcoin-based blockchains like Botanix solve this by introducing Ethereum virtual machine compatibility while still anchoring to Bitcoin for settlement.”
In addition, skepticism from Bitcoin purists has also created challenges. Schroe pointed out that these people often doubt the security and other aspects associated with Bitcoin DeFi.
“Ultimately, the antidote is education and execution. The more users see how they can earn from BTC in a non-custodial, Bitcoin-native way, the faster adoption will follow,” he commented.
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