Bitcoin’s long-held status as digital gold is evolving as Bitlayer and Sui join forces to unlock new yield-generating possibilities for BTC holders. Through the integration of Bitlayer’s BitVM bridge, the Sui blockchain now supports Peg-BTC (YBTC), a Bitcoin-backed token that seamlessly brings Bitcoin into the heart of Sui’s DeFi ecosystem.
This collaboration allows Bitcoin holders to transfer their BTC to Sui, where it is converted into Peg-BTC. With this bridged asset, users can participate in a wide range of DeFi activities — from staking and lending to borrowing and trading — all while maintaining direct exposure to Bitcoin’s value.
“Bitcoin dominates as a store of value, but its potential for DeFi remains largely untapped,” said Charlie Hu, co-founder of Bitlayer. “Peg-BTC is a game changer, allowing users to earn yield on Bitcoin without sacrificing its core value.”
The concept of BitcoinFi — earning yield on Bitcoin through decentralized finance — gained significant momentum at the Token2049 conference in Dubai, where influential investors like Franklin Templeton expressed strong support.
Bitlayer’s innovative approach uses the BitVM paradigm to bring smart contract functionality to Bitcoin without altering its underlying consensus mechanism. Its trust-minimized BitVM-powered zero-knowledge bridge enables secure, decentralized transfers of BTC across blockchains without centralized intermediaries.
Sui’s Layer 1 blockchain, known for its high throughput and low-cost parallel processing, currently hosts 49 DeFi projects with over $2 billion in assets locked, according to DeFiLlama.
With Peg-BTC now integrated, Sui users can stake the token to earn interest, lend or borrow it within various protocols, and trade it on decentralized exchanges, unlocking new avenues for Bitcoin holders to generate yield.
Bitlayer plans to collaborate with Sui’s top protocols, focusing on projects with the highest total value locked and active user bases to maximize Peg-BTC’s impact.
Adeniyi Abiodun, Co-Founder and CPO of Mysten Labs, the team behind Sui, highlighted the network’s commitment to expanding BitcoinFi infrastructure: “We are integrating a full stack of BitcoinFi assets and infrastructure — including staking, restaking, wrapped tokens, and now Peg-BTC — to meet growing demand for Bitcoin to serve purposes beyond simply being held.”
BTC assets already account for over 10% of Sui’s total value locked, with more than 587 BTC flowing into DeFi since February. “Sui’s advanced programmability combined with leading BitcoinFi integrations is turning Bitcoin from a passive store of value into an active, income-generating asset,” Abiodun concluded.
