[REDACTED] 2024 | Bringing DeFi to Bitcoin

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1. 0:01

   one of the things I always make sure I think it's an OCD problem is like right people sitting on the right chair I hope everybody is good today let's bring some energy after the nice lunch wake people up so I'm I'm going to talk a bit about um BTC def talking about very quickly about the history of defi the smart contracts the programmability interoperability and chain abstraction I'm joined by this fantastic panel David

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   one let's call you David 2 Escobar and Kyle some of the best people we have in our ecosystem at the moment uh also very Defi and Technical oriented so I would want to quickly start with an introduction of the panel first and then I'll give my introduction I think that's uh a bit more fair uh can we start with you David please yeah hi I'm David I'm at the CEO of Sig Network and at Sig Network what we do is we bring the ability for every

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   single smart contract in every chain to hold private keys and use them so the first the one you're most familiar with is chain signatures on near which we did did this year and next year we're going to make it so Bitcoin can talk back and tell you what your balances are and whether a transaction landed and then you know and then in January we're also going to make it so you can store Bitcoin in your nosis safe if you want to or on Ave or Unis Swap and all that

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   kind of stuff so really really interesting stuff great exciting yeah please okay yeah I'm escober um of Sate of satosi protocol um we basically running on top of near chain signature um we develop um direct Bitcoin on RAM of ram from one to another chain but basically it's all the core Tech everything was built on top of near hi everybody I'm Kyle I'm with the Stax Asia Foundation I'm our executive director for those who may not be aware of stacks were one of the original

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   Bitcoin layers and we're the very first to bring programmability and smart contracts to bitcoin that help boom this entire world that we're talking about today around building on bitcoin to bitcoin fi and its current iteration today I'm also an advising partner to bitcoin Frontier fund and was recently one of the largest investors over the last four years in companies that were building on bitcoin across the entire

6. 2:25

   ecosystem as well very interesting David please thank you so much um guys uh it's my pleasure to see you uh my name is David uh I am the director of global BD um the company called uh beat layer uh bit layer is a fully evm compatible layer too uh built on bitcoin um currently uh pretty much leading like in terms of all the metrics um like we've been live on uh main net uh starting from this year uh from um April 15th that's when the main it started and um

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   yeah like the ecosystem grew quite big um we have like pretty much like around like 220 um protocols live on mainnet and um guys if you're interested in hearing about Bitcoin defi we are the uh right people to talk to probably thank you great thank you so much um as for me I work with near foundation for two almost two years now I look after the integration of uh most of the applications whether it's internal or external uh and I work with the most of the people here on the stage making sure

8. 3:30

   that things are available their performant and the user experience uh is is is good as well as secure so going back to very quickly touching back on the history of defi we saw know Bitcoin in 2009 getting launched five or six years later we saw ethereum coming in with the programm programmability part of it and then we saw the D5 summer with awe meow unisoft of the world which completely changed the way defi uh uh as we see today right going literally 100x

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   or even more from there do you want to quickly uh share your uh experience or background with how did you get into Def and uh and what really excites you into working on the defi space I can jump right in um um what excites me most about defi is the ability to bring uh people who don't have access access to sort of strong financial systems and assets um access those systems so the ability to hold a currency that isn't going to devalue

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    that isn't controlled by one capricious or Shady company um having the ability to swap assets around uh and the ability to know it's going to work the same way today as it does in in 10 years time as it does today so having that security in not just the asset but the protocol you're using as well right very Noble my thoughts on defi I think the biggest Milestone on ecosystem is having

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    Unis Swan as the I mean they're the game changer at that time and then everything just growing as fast as possible everyone just inspired by Unis swof at first place then a and all those stuff is just totally make everything possible when at first place people just thought about trading on CX right I think for for me I I've been lucky enough to be in the def area of this industry for some time and watch it through multiple eras and

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    cycles and having it watched it evolve from the early days of a and Unis swap to where we are today has been super exciting and for me part of the reason why I got into defi not only playing around but also building and then later investing in it as well and watching it now come to the Bitcoin side of the industry I think it's very impactful to watch that seven eight years of development of trial and error of less Lessons Learned to all of the on and off ramps that we saw to now bringing this all back home to to bitcoin has been

13. 6:06

    pretty fascinating to watch happen right how about you David yeah um it's a it's a very interesting question like um I think ironically not that much uh changed uh since the defi summer because um a big part a big chunk of crypto is all about narratives right and those change um every now and then like um you have defi you have um nfts um you have other stuff but the truth is that like in terms of uh utility um in cryptocurrencies in general like defi is

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    still the the biggest use case um and I think like everyone in this room um uses some defi protocols to to some extent right because um there like a lot of things like just like I mentioned nfts um say meme coins and stuff like that nothing wrong with that uh it's like about speculation like for for for the most part but uh um whoever holds any cryptocurrencies here in this room and it doesn't matter what it really is XYZ whatever um basically um defi is still

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    the king because that's the way to actually uh put your assets into use um so um yeah and like if you think about it like the most groundbreaking things apart from um from the infrastructure um actually happened in defi um Escobar just mentioned that uh basically when um Unis swap V1 V2 whatever uh when it got reled it was a groundbreaking thing and uh whatever happens in cryptocurrency whatever you can call groundbreaking usually happens in defi right uh and you

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    name it like everybody has like own preferences so obviously like uh Unis swap changed a lot then you had like um GMX I know you had like um liquid for example um you name it but like those are the protocols that uh can be used by people like a lot of them like Prov to be working um historically and um yeah I mean like if you are in cryptocurrency uh and if you are not into Defi and you know you can choose your own protocol

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    whatever tickles you're fancy then you're probably doing something wrong because it's just like more effective way of actually putting your assets into use yeah that's true and that also actually very briefly touches upon the point like you said def is uh the most uh interesting use case because it brings a lot of incentive right incentives as well as decentralization like you mentioned Escobar of Finance so

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    to say so I I want to uh understand or learn from you Kyle and also from everyone else here about interoperability right so we have had this uh Bitcoin which was the decentralized finance then we got into the programmability part of it with smart contracts and now we see a lot of btcd use cases coming out because we also want people to pull out their Bitcoin from their wallets and start using it for different purpose so so

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    what what are your thoughtss around it and how is bit layer in that case or Satoshi or Sig Network or you know Stacks doing around that in terms of bringing more users better liquidity or even more incentives yeah so a lots of that question maybe we'll take a quick step back and then we'll we'll slingshot forward so um from a defi perspective on bitcoin leading into operability so we

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    saw some very early traction around defi in Bitcoin back in 2021 all right Stacks went main net we had lightning also pretty active at that time so we saw a payments infrastructure we saw the beginnings of dexes amm swaps wallets this entire world that we had seen for years in ethereum start to be introduced at scale on bitcoin and then fast forward we started to see the next era of that spark around ordinals launch in January of 2023 which kind of launched

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    us into this very big experimental era we've been in with building on bitcoin and that has opened up the next unlock which was how the liquidity and users could start to migrate from one ecosystem to another and how other ecosystems could leverage and their applications the stability and security of bitcoin's core Network now where we're headed um which stacks and all of us are all playing a role in supporting either from a liquidity side to uh a

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    wallet and Bridge side to the asset side is now we're moving into the next era of where BTC the asset now has utility and that is kind of this next big unlock with uh Bitcoin defire bitfi that will open up the next wave of interoperability the first wave we'll say was more around EVMS ethereum virtual machines where you had a few networks that were native to bitcoin then you had those that were built off of ethereum EVMS that opened up a very easy transition for users right now what

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    we're starting to see is svm so salana virtual machines move mvms we're seeing more interaction from the near ecosystem as well now as we start to head into Bitcoin having utility with tokenized Bitcoin we've got 20 plus assets that are either wrapped or native uh tokenized Bitcoin that are coming to market now that will allow users to bring their BTC that has sat dormant on the L1 into a layer whether that's second or otherwise and then into the

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    application layer and be able to do a lot of the defi we had seen in ethereum to now even more in the near future that begins to unlock as we start to see this trillion and a half dollars of an ecosystem become active and from a numberers perspective we go back almost year to date December 2023 we had about $300 million of active tvl and user activity in Bitcoin today actually numbers as of last week so not counting this massive pump we just had we have

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    now over $4 billion dollar in tvl that's from reaking and also from liquid staking to General defy activities nfts Etc and rwas that has pushed this industry forward that is before the unlock where now you're going to be able to again take that BTC and move it on the stack side we're doing that at scale with our asset called sbtc we also have the pleasure of working with near apos salana will be bringing that asset across chain to allow for those

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    additional ecosystems that may not yet be evm to have Bitcoin in their ecosystem because at the end of the day right now there's 47 million active wallets with more than $1 of BTC in them today that $1 plus wants to move it wants to earn it wants to yield it wants to be engaged in a either simple safe manner or maybe a more uh risk averse manner that allows them to do much more as well and that's driving for this big reaking and staking narrative that we

27. 13:14

    saw a few panels about today as well nice I think it's interesting to capture what K mentioned like um the the role that Satoshi decided to play around this uh bit Bitcoin device SC is how we can give a best user experience to bring their Bitcoin across all chain just through near which is the through the change sign nature like you can just easily simply um deploy your liquidity

28. 13:46

    your Bitcoin liquidity to any other DF directly with one single wallet I think that's pretty interesting well we know that not every users are smart enough to do every single little things and a fragmented liquidity and all the the liquidity in a wallet you can see all all chain being mantioned it's pretty fun things as well then we want to tackle all of those things so I agree

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    with K on what's the narrative that we want to bring to the market is really important about how we want to grow the Bitcoin Divi at the moment absolutely I think right now we're living in the dark ages of interoperability and the dark ages of interoperability specifically with Bitcoin Bitcoin has the best name recognition of any token my grandmother still thinks I work in Bitcoin um and sorry it has it's completely bombproof

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    it's so bombproof that for for the last 10 years people have been trying to reset a test net and they're unable to because it just keeps surviving and moving it is by far the best place for anyone to have an asset um and it's very aply called called digital gold because uh much like gold it sits there and does nothing um and what we're going to have in summer of next year because right now we have chain signatures and what chain signatures allows you to do is allows

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    you to have an abstract account that can bring all these sort of really amazing features this sort of relatively interesting defi to bitcoin but what we're going to have next summer is we're going to have these chain Keys everywhere and we're going to have these chain keys on bitcoin what that means is I can put native Bitcoin on ethereum salana base wrap it in an erc20 contract and have people interact with that either directly or in such a way that they don't have to pay

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    any fees and we're not I don't think we're going to be talking about speci because right now if you want to do BTC defi you have to live breathe Bitcoin the whole time that's has to be all you care about I think soon Bitcoin is going to be another token but the token which has the best properties with which to store store value and the thing people use everywhere to do lots and lots of anything interesting with capital um so I think it's going to be the absolute Lynch pin of all defi by the end of next

33. 16:16

    year very well said yeah yeah so um it's a very good question and I I don't really know where to start um so um let's talk about uh Bitcoin itself for a second so like the asset has has been around for uh for quite a while and um we've been through like I'd say like three iterations of The Narrative right so like if you uh read um bitcoin's uh white paper I mean the premise that's in there was that uh Bitcoin was invented to serve the

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    purpose of becoming like peer-to-peer digital cash and now um that's actually a topic that divides people um because some people would argue that it actually uh fulfills its premise some people would argue that ah not exactly um because of the adoption stuff like that so as the time passed the narrative changed slightly and um Bitcoin became a store of value right and we know how it

35. 17:10

    played out I mean quite well so uh that was like the second iteration of the narrative and uh the third um iteration is actually um making it a utility asset so uh actually um I've been always uh a fan of uh ethereum ecosystem uh so like last year when when I came across BVM white paper I mean the idea behind it just blew my mind um because it's such a huge Market uh so much of an untapped potential so much uh of a dormant

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    Capital just like gentleman said and um imagine that you can actually put it to use I mean it's absolutely insane if you think about it um so the thing is that like uh when it comes to the current state of Technology like um um in L2 um on bitcoin this is still a very very new thing in most of the cases so the current state of technology is not ideal because it's still so early so uh we are

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    talking about certain trust assumptions like Bridges like being the uh the biggest problem but those uh those issues are going to be uh solved sooner or later um and that's going to change um everything right because once we get rid of those trust assumptions like this1 trillion worth of Market can be actually unlocked because right now those people let's say who have been holding Bitcoin for God knows how long um they're being skeptical um and I

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    completely understand that um so um we are all like uh building those ecosystems together and um you name it um bit layer stocks uh build on bitcoin m whatever um we are Paving the way um and um sometimes like uh I come across the guys from like um different companies and like we make those jokes oh like we are a competition but actually uh if you think about it the the pie is so big that there's enough space uh for everyone and just a closing thought um about

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    interoperability um yeah I mean topics such as um interoperability account obstruction are going to be a really really big thing in the future um the same goes to like most of the protocols uh that will go Omni chain like sooner or later um the thing like defi world is evolving so I see the future as uh everything goes multi-chain right there's like a free migration between chain X and chain y as

40. 19:54

    it goes uh money goes where it's treated best uh but it's all about um adoption so interoperability um liquidity chain obstructions those are key things um there are a lot of protocols building in the space right now but uh we are not there yet so it's all about adoption it's all about making things easy and understandable right very good uh I think we're running short of time if I may borrow a couple of minutes I would like to touch upon one last

41. 20:26

    point I think it's okay take it as a yes thank you so much so uh you touched upon uh Bridges you touched upon uh experiences of user and fragmentation right so very quickly uh starting with you again Kyle would want to hear your inputs on chain abstraction and the experience or the information that you have about nearest chain exraction and the possibilities with with it in the D5

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    space I think right now I back to a point David mentioned we're kind of in the Dark Ages I call it the experimental time so we are in in this experimental phase when it comes to bitcoin but also bitfi and near plays a very important role not necessarily near of the past but near of the future and a lot of what chain of abstraction is bringing but then also uh the the conversations we heard yesterday about Ai and where that

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    also may play in the future of defi as well so I think it's got a big big exciting future ahead right now it's very experimental and that's a good thing for us to learn how it's going to work going forward right I can I can say it's an interesting directions for near um especially chain abstraction has been around for near for some sometimes since I think it's last year we we have

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    talking about it and then suddenly um it it's aligned with all the Bitcoin narrative at the same time and we start from Bitcoin and it provide more value to those uh ecosystem that has no smart contract I think that'll be very interesting to be continue maybe with xrp not sure yeah when we started doing chain interaction stuff it was originally called no one gives a about your blockchain um and I think people just want to do stuff and they don't care about your

45. 22:08

    blockchain and I think therefore it's great yeah just a closing thought uh basically that's the point that's the end game right it's like you want that like if you want to get like more adoption in crypto uh the end game just like David mentioned is that uh you are the user you sit in front of a computer you perform the transaction without even knowing uh which chain it actually is um

46. 22:32

    and um like we are getting better at it but like right now it's difficult I mean really like for us like it seems to be so obvious because like uh we've been around for quite a long time but sometimes uh I think we take things for granted and um when it comes to people that you know like never had anything to do with blockchain stuff like that This is complicated I mean it can appear to be easy but really it's not so um yeah

47. 23:04

    the end game is just to make things simple and once Things Are Made Simple like the adoption will will come right thank you thank you so much everyone and thanks for listening everyone here