WBTC expands to Hedera as Bitcoin liquidity flows into new DeFi rails
Wrapped Bitcoin (WBTC), the largest tokenized version of Bitcoin, has been integrated into the Hedera network, aiming to expand decentralized finance (DeFi) options for BTC holders. This integration boosts Hedera’s liquidity and positions it as a low-fee network designed to avoid frontrunning and miner-extractable value (MEV). The initiative, supported by BitGo, BiT Global, and LayerZero, allows Bitcoin to participate in smart contract ecosystems for lending, trading, and other DeFi protocols without losing exposure to the underlying asset. Hedera has seen a rise in DeFi activity, with its token HBAR ranking as the 19th-largest cryptocurrency by market cap. The move reflects a broader trend where Bitcoin plays an active role in DeFi, establishing its own financial ecosystem and potentially driving wider adoption.
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Introduction: WBTC Expands to Hedera
Wrapped Bitcoin (WBTC), the largest tokenized version of Bitcoin, has expanded to the Hedera network — a move that could open the door to more decentralized finance (DeFi) options for BTC holders. The integration, announced Thursday, brings additional liquidity to Hedera, which already supports smart contracts and native tokenization. It markets itself as a low-fee network with no frontrunning or miner-extractable value (MEV).
Preventing Frontrunning and MEV
Frontrunning and MEV are tactics where validators reorder transactions to profit at users’ expense. Hedera’s consensus mechanism is designed to avoid these issues, ensuring a more fair and transparent network for users.
Collaboration Behind the Launch
The integration was supported by BitGo, a Hedera Council member and the primary custodian behind WBTC, alongside BiT Global and LayerZero, an interoperability provider. This collaboration reflects a united effort to enhance BTC's utility within the DeFi ecosystem.
What is Wrapped Bitcoin?
WBTC gained popularity as one of the first large-scale solutions enabling Bitcoin (BTC) holders to participate in DeFi. Wrapping allows BTC to be converted into a token on another blockchain while remaining fully backed by Bitcoin held in custody. This enables users to deploy BTC in smart contracts for lending, trading, and other protocols without forfeiting Bitcoin exposure.
Hedera's DeFi Growth & HBAR Market Position
Hedera has experienced a significant uptick in DeFi activity, evidenced by a notable increase in total value locked (TVL) over the past 12 months. Its native token, HBAR, is currently the 19th-largest cryptocurrency by market capitalization, with an estimated value of $7 billion.
Bitcoin DeFi Sector's Growth Trend
Hedera’s move aligns with a broader trend connecting Bitcoin and DeFi. Many in the industry believe Bitcoin's significance as an asset makes it too valuable to remain idle in wallets and see it increasingly integrated into financial ecosystems. As noted by Jacob Phillips, co-founder of Lombard Finance, at the Bitcoin 2025 conference:
"Bitcoin DeFi is about building a trustless, permissionless financial system around Bitcoin, turning it into an active financial instrument, not just a vault."
Market Insights & Future Outlook
Binance Research has highlighted the rise of the Bitcoin DeFi sector, or BTCFi, suggesting it could drive new adoption of Bitcoin. Additionally, the sector’s growth may reinforce positive sentiment for Bitcoin in the medium and long term, according to a report by Binance Research.