Bitcoin-native decentralized finance (DeFi) is expected to grow significantly in 2025, driven by increasing institutional adoption and a maturing ecosystem. Industry executives project that Bitcoin staking could represent a $200 billion market opportunity, currently holding around $5.5 billion in total value locked (TVL). Institutions have shown keen interest in utilizing Bitcoin to earn yield through staking, which offers attractive returns compared to traditional options. The total value locked in Bitcoin DeFi could see a massive increase, potentially by 300 times, as large funds are eager to engage in this space. Emerging protocols like Babylon and EigenLayer are positioned to benefit. Liquid staking tokens (LSTs) are also emerging, facilitating complex DeFi strategies with Bitcoin as a collateral asset, which could contribute to Bitcoin's potential as a global reserve currency. As the DeFi ecosystem continues to develop, it may redefine benchmarks for lending and borrowing against Bitcoin.

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