Although Bitcoin's decentralized finance sector is still in the early stages compared to Ethereum, it is becoming more secure and cost-effective, according to a recent report by crypto analytics firm Messari. A key player in this development is Rootstock, a pioneering Bitcoin layer-2 project. As highlighted in Messari's 'State of Rootstock' report, Rootstock is now backed by 81% of Bitcoin's total hashrate, thanks to the integration of major mining pools Foundry and Spiderpool in February, which previously accounted for 56%.
This significant increase in hashrate share enhances the security of the network. Moreover, transaction fees on Rootstock are substantially lower, being 95% cheaper than average Bitcoin transactions and 55% cheaper than those on Ethereum. Rootstock aims to increase Bitcoin's utility by providing DeFi capabilities through smart contracts, utilizing a modified version of the BitVM programming language known as BitVMX. The project has also partnered with LayerZero, a bridging protocol, to enable connections between Rootstock-native applications and numerous other blockchains, including Ethereum and Solana.
This momentum is expected to drive the adoption of Bitcoin DeFi throughout 2025, as stated by Messari. According to Andrew Yang, an analyst at Messari, 'As Bitcoin DeFi continues to grow, Rootstock is poised for broader adoption due to core upgrades such as a 60% reduction in transaction fees, along with sustained investment in builder education and incentive programs.'