Solution: Bridging Bitcoin to Layer2 via tBTC
Bitcoin’s greatest challenge in DeFi adoption is not demand—it is infrastructure. Existing solutions that bridge Bitcoin to programmable chains such as Ethereum or BNB Chain typically follow a centralized model:
Users deposit BTC into a custodian-controlled wallet (e.g., BitGo for WBTC).
A wrapped token (ERC-20/BEP-20) is issued to represent the deposited Bitcoin.
Redemption requires the custodian’s approval and cooperation.
This model, while functional, introduces significant risks:
Custody risk: A single entity controls the underlying BTC.
Censorship risk: Regulatory pressure or policy changes can freeze assets.
Counterparty risk: Users must trust that the custodian will always remain solvent and act honestly.
Such trade-offs undermine Bitcoin’s very ethos as a sovereign, permissionless, and censorship-resistant asset.
Introducing tBTC: A Decentralized Bitcoin Bridge
tBTC offers a fundamentally different approach. Instead of relying on centralized custodians, it leverages the Threshold Network and threshold cryptography to provide a trust-minimized, decentralized bridge for Bitcoin.
Key properties:
BTC Locking on Bitcoin Mainnet
Users send BTC directly to a decentralized vault on Bitcoin Layer 1.
No single party ever controls custody of the locked Bitcoin.
Minting Equivalent tBTC
Users receive tBTC, a tokenized representation of BTC, on target programmable chains (ERC-20 on Ethereum, BEP-20 on BNB Chain, etc.).
tBTC is always redeemable 1:1 for native BTC.
Validator-Based Security
Instead of custodians, BTC deposits are secured by a randomly selected group of operators running nodes on the Threshold Network.
Operators collectively control deposits via threshold signatures, requiring a quorum to perform any action.
Operator sets rotate periodically, ensuring no static group can collude.
Honest Majority Assumption
The system assumes that the majority of randomly selected operators are honest.
This drastically reduces the risk of collusion or theft, since attackers must compromise a large portion of distributed operators simultaneously.
Users of tBTC therefore “trust math, not people.”
Reference: https://docs.threshold.network/applications/tbtc-v2
Supported Networks for BitFire
By leveraging tBTC, BitFire integrates Bitcoin into both Ethereum-compatible and Bitcoin-native ecosystems:
BNB Chain: A high-performance Layer 1 with robust DeFi activity, institutional adoption, and mature liquidity infrastructure. Deploying BTC here unlocks access to lending markets, DEXs, yield aggregators, and derivatives.
Mezo (Bitcoin Layer 2): A Bitcoin-native Layer 2 optimized for DeFi applications. tBTC on Mezo keeps BTC within its own ecosystem while enabling programmability, making it ideal for native BTC-backed lending and yield products.
Benefits of tBTC for Lending in BitFire
Trustless Minting and Redemption
Any user can mint or redeem tBTC without permission or custodian approval.
Non-Custodial Security
Removes reliance on centralized custodians and eliminates counterparty risk.
Cross-Chain Composability
tBTC can circulate freely across chains and be deployed in lending, liquidity pools, derivatives, and structured markets.
Scalable Infrastructure for BTC Lending
By anchoring lending markets to a decentralized Bitcoin bridge, BitFire creates a secure foundation for BTC-backed credit, stablecoins, and structured yield products.
Why tBTC Matters
Unlike prior solutions, tBTC enables Bitcoin to move at the speed of DeFi without compromising its core values of decentralization and censorship-resistance. For the first time, Bitcoin holders can:
Earn yield by lending BTC.
Mint stablecoins backed by BTC collateral.
Provide liquidity and access derivatives markets.
Integrate Bitcoin seamlessly into cross-chain financial products.
In short, BitFire + tBTC transforms Bitcoin from a static store of value into an active engine for decentralized finance.
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