X Space Recap: ETH DeFi vs BTCFi — The Battle for Liquidity

In September 2025, we brought the community together on X Spaces to unpack one of the hottest debates in crypto: can BTCFi challenge Ethereum’s DeFi dominance, or is Ethereum still the home of programmable finance?

The panel featured builders, researchers, and long-time community voices. The discussion avoided price talk and focused instead on ecosystem design, adoption paths, and what users — both institutional and retail — are really doing today.

Event Snapshot

Where: X Spaces

When: September 2025

Who:

• Host: Foxy

Speakers:

• Faraj — Cross Curve Protocol and For Crypto Executives
• Chunky — BD & Program Manager at FSL 
• Veggie — Multichain DeFi participant
• Dormant (Nick) — Builder/advisor in the BTCFi ecosystem
• Buba — Crypto enthusiast since 2022

Why: To explore BTCFi vs Ethereum DeFi, institutional adoption, and how retail users fit into this evolving landscape.

Highlights from the Conversation

Note: Quotes have been edited for clarity and conciseness.

🔥 1) BTCFi interest is rising, but Ethereum still leads for DeFi

Ethereum was described as the core environment for programmable finance and institutional comfort. BTC remains widely seen as a “digital commodity” and store of value, while Ethereum’s VM and app layer continue to attract most DeFi innovation. 

BTCFi will likely keep experimenting with wrappers, sidechains, and L2s, but for now it represents only a smaller slice of BTC’s value.

“The further innovation will continue in the BTCFi system… however the true decentralized finance will stay with the Ethereum ecosystem.” — Faraj

🔥 2) Institutional Adoption & Comfort Zones

Institutions already use Ethereum tooling and tolerate higher fees because they view the network as tried and tested. By contrast, BTCFi has yet to attract significant institutional flows.

“Big institutions are comfortable using [Ethereum]… I didn’t see large amount in institutions that would come and participate in BTCFi.” — Faraj

🔥 3) Solana’s Role

Speed and cost were highlighted as major drivers for mainstream adoption. While Ethereum remains dominant through 2025–2026, Solana’s low fees and fast execution could gradually chip away at its market share.

“Once people realize how fast it is and how low the fees are… we’ll see Solana start to eat away at that market share a little bit.” — Chunky

🔥 4) Bridges, Wrappers & Interoperability

Interoperability was seen as crucial but still imperfect. Bridges, while improving, have long been considered a weak point. 

Many L1s and L2s rely on BTC wrappers with different mechanisms and margins, but without standardization. Wrappers expand access, though they also add another layer of trust and risk.

“Bridges have been notoriously weak… but we’re seeing improvements.” — Chunky

“Wrappers give you options, but they also add another layer of trust you’re taking on.” — Veggie

🔥 5) Bitcoin’s Programmability Debate

Bitcoin maximalists continue to resist programmability at the base layer. The expectation is that new financial logic will expand through L2s and sidechains, while the base chain will remain conservative — changed only for security necessities like quantum resistance.

“Maximalists don’t want Bitcoin to be programmed… programmability will happen on L2s and sidechains, not the base layer.” — Faraj

🔥 6) “Middle layer” retail behavior and simple strategies

Retail strategies remain divided: some prefer using DeFi tools to grow their holdings, while others stick to simply holding BTC. Both approaches were acknowledged as valid.

“If I had BTC, I would definitely hold it.” — Buba

Yield-bearing options do exist, though no specific projects were endorsed during the discussion.

“There are companies now that let you earn yield on BTC through wrappers and custodians.” — Dormant

🔥 7) Bitcoin as “Digital Gold”

The conversation returned to why Bitcoin carries the “digital gold” label. The fixed 21M supply, decentralized security, and cultural narrative continue to reinforce this identity. 

Bitcoin’s journey runs from early skepticism and crises like Mt. Gox, through China’s mining bans that reshaped global mining, to today’s phase of broader institutional acceptance. Each step has reinforced its role as a resilient store of value.

“In the digital age, we don’t need the medium of exchange to be physical. Bitcoin’s fixed supply makes it digital gold.” — Faraj

Closing

This Space brought honest takes on BTCFi’s promise, Ethereum’s current lead, and Solana’s growing appeal. It also reminded us that crypto isn’t just about institutions, but retail strategies, culture, and narratives still shape the path forward.

Thanks to Faraj, Chunky, Veggie, Dormant, Buba, and everyone who tuned in. Stay close for our next X Space — we’ll keep asking the questions that matter ⛏👾