Cardano founder Charles Hoskinson has unveiled a groundbreaking vision for Bitcoin’s integration into decentralized finance (DeFi). Speaking on the Mr. M Podcast alongside early Bitcoin adopter Davinci Jeremie, Hoskinson outlined how Bitcoin holders could access DeFi opportunities without leaving the Bitcoin ecosystem.
Bitcoin DeFi: A Sleeping Giant
Hoskinson highlighted the immense potential of Bitcoin DeFi, describing it as a sector poised for explosive growth. “Bitcoin DeFi is going to be a huge category because it’s like $2 trillion of assets are waking up,” he remarked. Despite Bitcoin’s massive market capitalization, it currently lacks substantial total value locked (TVL) in DeFi applications. According to Hoskinson, Bitcoin holders are seeking yield-generating opportunities and new financial tools to maximize their assets.
🚨 New Podcast with @IOHK_Charles & @Davincij15 🚨
— Mr. M (@MrMPodcast) February 23, 2025
We talked about:
❶ #ADA Supercharging #Bitcoin ?
❷ Decentralization
❸ What's Next For #Cardano
Watch it here 👇https://t.co/cbTL3EcQ9w pic.twitter.com/diNd9IWDDF
Cardano’s Babel Fees: A Seamless Solution
A key component of Cardano’s Bitcoin DeFi vision is Babel fees, an innovative mechanism that allows users to pay transaction fees using their native assets instead of ADA. If Bitcoin were wrapped on Cardano, users could conduct transactions and pay fees in Bitcoin, eliminating the need for ADA and streamlining the process. Hoskinson likened this system to using a credit card abroad, where transactions occur in one currency but settle in another, enhancing usability and accessibility.
Midnight Project and Interoperability
Hoskinson also discussed Midnight, a privacy-focused sidechain launching this year, which could further enhance Bitcoin DeFi. He emphasized that Cardano is evolving into a multichain ecosystem, increasing transaction volume and user engagement. He compared the blockchain landscape to isolated islands, suggesting that improved interoperability will transform these silos into a seamlessly connected network, much like how Florida is linked to the mainland.
Hoskinson reiterated that Cardano incorporates several Bitcoin principles, including deflationary monetary policies, a fixed supply, and the UTXO transaction model. These shared foundations make Cardano a familiar yet enhanced environment for Bitcoin holders exploring DeFi.
Looking ahead, Hoskinson stressed that for Cardano to thrive, it must expand its active user base, increase transaction volume, and gain regulatory trust. As Bitcoin DeFi gains traction, platforms like MetaMask may explore integrations with Cardano, potentially driving exponential growth in TVL and user adoption over the next two to three years.
Also Read: Cardano’s Q4 2024 Boom: Price Surge, DeFi Expansion & Key Upgrades Propel Growth
With DeFi solutions like Babel fees and the Midnight project, Cardano is positioning itself as a major player in the evolving blockchain landscape, bridging Bitcoin into a new era of financial opportunities.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of CoinBrief.io. Before making any investment decisions, you should always conduct your own research. Coin Brief is not responsible for any financial losses.
