Bitcoin is no longer just a store of value. In 2025, it's becoming programmable with smart contract layers, collateralized yield products, and a rising wave of institutional attention.
In the latest panel “BTCFi Now: Bitcoin’s Programmable Era & Institutional Yield”, hosted by IXS, we brought together Julian Kwan (IXS), Grant Nissly (Stacks Labs) and Ryan Yoon (Tiger Research) to unpack where Bitcoin Finance (BTCFi) is headed and what infrastructure is needed to unlock real institutional adoption.
In case you missed it, watch the recording below.
Key takeaways from the panel discussion below.
Ryan Yoon kicked off by framing BTCFi as a natural evolution: Bitcoin is the largest digital asset by market cap, but it has historically lacked native programmability. New demand, from ETFs, corporate treasuries, and yield-seeking holders, is now meeting new infrastructure. This creates a BTCFi stack that looks like this:
BTCFi is not about altering Bitcoin itself. It’s about building around it, anchored in its security guarantees, and expanding what users can do with their holdings.
At the same time, rapid progress across infrastructure, protocol design, and application layers shows how quickly the BTCFi ecosystem is maturing. Yet, awareness and trust remain key barriers; many institutions still don’t fully understand the frameworks or risks, highlighting that education and credibility must grow alongside innovation.
According to Grant Nissly, Stacks doesn’t modify Bitcoin L1. Instead, it brings smart contracts and dApps to Bitcoin via a separate layer that “settles to Bitcoin.” In simple terms, it’s programmable Bitcoin with Bitcoin’s security. This model allows for DeFi-style functionality, like lending, swapping, minting, while anchoring every state change to Bitcoin blocks.
Stacks’ upcoming sBTC feature introduces a native BTC-backed asset that’s verifiable and automatically redeemable. Unlike wrapped BTC models reliant on centralized custody, sBTC aims for a trust-minimized design using cryptographic proofs and consensus checkpoints. At the core of its security is the Signer network, an open permissionless group of consensus participants responsible for validating and signing blocks produced by Stacks miners as well as operating the sBTC bridge.
The panel agreed: Bitcoin’s decentralization, censorship-resistance, and brand trust make it the right foundation for long-term financial infrastructure. For institutions, that matters. As Grant noted, "When you anchor to Bitcoin, you inherit the finality and credibility institutions already recognize."
This trust layer gives BTCFi a different feel than Ethereum-based DeFi. It’s about security, transparency, and long-term confidence.
One of the most discussed themes: how BTC can earn yield without leaving regulated rails.
Julian Kwan, CEO of IXS shared how institutional BTC holders increasingly want exposure to real-world yield without selling their BTC. IXS’s BTC Real Yield model enables this by turning BTC into collateral for regulated, short-duration structured products.
As Julian put it: “What we’re doing with IXS is using Bitcoin as the native yield layer. Institutions can pledge BTC and access real-world yield from short-duration instruments like treasuries, private credit, and similar without selling their Bitcoin.”
The role of RWA in BTCFi is becoming clearer: BTC doesn’t need to leave the ecosystem. It needs to be connected to the yield rails that institutions already use.
When asked what’s holding BTCFi back, panelists didn’t mention technology first. They talked about standards, like custody frameworks, disclosure practices, and proof-of-reserve systems that mirror traditional finance.
To attract institutional capital, BTCFi projects will need to show:
Ryan emphasized: “Adoption won’t come just because the yield is there. It will come when the infrastructure earns trust.”
Still, awareness remains a challenge, and institutions require a much stronger foundation of trust and regulatory clarity before fully engaging. The continued growth of BTC ETFs play a pivotal role in accelerating institutional comfort and confidence in this emerging ecosystem.
BTCFi’s inflection point may not come from just more products but from more integration. Think: Bitcoin-based staking ETFs, custodians offering native BTCFi vaults, and regulatory clarity from jurisdictions like the Bahamas or Singapore (where IXS is licensed under the DARE Act).
It’s about connecting the layers:
That’s the BTCFi blueprint and it's already underway.
BTCFi is expected to be a long-term shift in how Bitcoin can work for institutional capital. The infrastructure is coming online. The compliance stack is catching up. The question now is how fast the market will move once the trust barriers fall.
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