The BTCFi flywheel is spinning real assets, real TVL, and a base layer with $2.09T of security behind it. Here's the state of BTCfi landscape as of June 2025... Bitcoin’s $2.09T market cap makes it crypto’s bedrock but its base layer, limited to 7–10 transactions per second (TPS) and prone to high fees during congestion, caps its utility. That’s where Bitcoin Layer 2s (L2s) and sidechains come in: solutions designed to scale Bitcoin and bring smart contracts, DeFi, and composability to the most secure asset in crypto. But after years of promise, are $BTC L2s actually delivering adoption in 2025? Or are they still running on speculative fumes? ● The $BTC L2 Landscape: June 2025 Snapshot Here are the key players shaping Bitcoin’s L2 and sidechain evolution each taking a unique approach to scalability and programmability: 1️⃣ Stacks (@stacks) Smart contract L2 using Proof-of-Transfer (PoX) to anchor to Bitcoin. - $112.19M TVL (per DeFiLlama), up 41% from April 2025. 14 protocols live. - sBTC: A 1:1 trust-minimized Bitcoin asset, powering native $BTC DeFi. - @FordefiHQ integration gives enterprises secure access to the Stacks ecosystem. 2️⃣ CORE (@Coredao_Org) CORE blends L1 and L2 elements, securing its chain via delegated Bitcoin hashpower. - $393.41M TVL, led by staking apps like @colend_xyz. - 58 protocols live, including launchpads and DEX aggregators. - Hashpower Participation: 10% of Bitcoin’s mining capacity supports validator security. 3️⃣ Rootstock (@rootstock_io) Rootstock brings Solidity-based dApps to Bitcoin via merge-mined security. - TVL: $268M, with 26+ dApps. @SovrynBTC and @moneyonchainok leads with $189.69 combined TVL. - Security: Merge-mined with 60% of Bitcoin’s hashpower. - rBTC: 1:1 $BTC-backed token used for gas fees. 4️⃣ BounceBit (@bounce_bit) BounceBit is a POS L2 that merges Bitcoin yield with Ethereum-style restaking. - TVL: $65M, with BounceClub leading liquid staking products. - Restaking: Integrated with Babylon’s BTC staking model. 5️⃣ Hemi (@hemi_xyz): Hemi is building a modular L2 supporting Bitcoin-backed assets and cross-chain swaps. - TVL: $254.38M, mostly from Hemi Vault and stablecoin protocols. - Ecosystem: 34+ protocols with early Solana/Ethereum integration via Hemi Bridge. ● Institutions Are Watching (But Waiting) With BlackRock’s IBIT ETF crossing $50B AUM and over 90 public companies now holding $BTC, institutional capital is here but it isn’t yet active on L2s. Key Use Cases They Want: → Tokenized treasuries/yield on $BTC → $BTC-native DeFi without $ETH exposure → Compliant custody and DeFi access ✍️ Final Take BTC L2s are in their Ethereum 2019–2020 era: Some usage, rising narratives, big upside but few breakout products yet. If you’re betting on Bitcoin’s smart contract future: - Stacks = adoption - CORE = Solid products - Rootstock = underhyped - Bitlayer/Hemi/B² = high-optionality tech plays This cycle, narrative is colliding with mechanism and the next cycle of winners is forming right now.