Bitlayer’s YBTC Shatters Bitcoin’s Idle Era—Now Earning Yield on Sui

Bitcoin holders, rejoice—your dormant stacks just got a DeFi wake-up call. Bitlayer’s new YBTC token turns BTC into a yield-generating asset on Sui’s blockchain, bypassing Bitcoin’s native limitations with a cross-chain twist.

How it works: Wrapped Bitcoin meets DeFi lego. YBTC represents Bitcoin deposited into Bitlayer’s system, which then deploys it across Sui’s lending protocols and liquidity pools. The result? Bitcoin finally pulls its weight—earning interest instead of collecting dust.

The fine print: While the 1:1 peg promises security, crypto veterans know cross-chain bridges carry risks (remember 2022’s ’bridge apocalypse’?). Still, for Bitcoin maximalists tired of watching ETH degens outpace them, this might be the Trojan horse that gets them farming—even if they’ll never admit it’s not ’pure’ Bitcoin.

Closing thought: Wall Street spends millions trying to tokenize assets—while crypto builders just did it during their coffee break. Take that, BlackRock.

In Brief

• Bitlayer announces the launch of YBTC, a Bitcoin-backed token, on the Sui blockchain via a BitVM bridge.
• YBTC enables mobilizing BTC in DeFi: staking, lending, borrowing, and trading on Sui DEXs.
• The BitVM Bridge operates without centralized intermediaries, ensuring the security and transparency of BTC transfers.
• Bitlayer aims to deploy its bridge to other major blockchains such as Arbitrum, Starknet, or Cardano.

YBTC: a bridge between Bitcoin and DeFi on Sui

Bitlayer officially launched Peg-BTC (YBTC) on the sui network on May 15, via the integration of a trustless BitVM Bridge.

Such an initiative was announced on Bitlayer’s official X account:

Bitlayer and Sui integrate the first trustless BitVM Bridge in the DeFi ecosystem, making bitcoin productive on Sui thanks to YBTC.

Specifically, this synthetic token allows investors to deposit their BTC on Bitlayer to convert it into YBTC on Sui, thus opening access to various DeFi applications on the network.

Features enabled by this launch include:

• Participation in staking via native Sui protocols, maintaining BTC exposure;
• Use in lending and borrowing services, allowing investors to generate yield or access liquidity;
• Trading on Sui’s DEXs, facilitating direct integration into decentralized markets;
• Value preservation pegged 1:1 to BTC, secured by native locking on Bitlayer.

Since February 2025, shared data indicates that over 587 BTC have been integrated into Sui’s DeFi ecosystem, representing more than 10% of its TVL. The launch of YBTC aims to accelerate this momentum by broadening the base of active Bitcoin investors in DeFi.

BitVM Bridge Technology: Security, Interoperability, and Multi-Chain Ambitions

The project’s technological specificity lies in using the BitVM Bridge, a trustless bridge solution. This mechanism, still rare in the BTC ecosystem, enables native locking of BTC on the Bitlayer LAYER before converting it into YBTC on Sui, without centralized intermediaries responsible for custodianship.

“The BitVM Bridge is designed to eliminate risks associated with intermediaries while ensuring transaction verifiability through a proof architecture,” explains Bitlayer in its technical documentation.

However, the ambition of the BitVM Bridge goes far beyond just the use case on Sui. Bitlayer already announces a roadmap expanding to other major ecosystems such as Base, Starknet, Arbitrum, Sonic, Cardano, and Plume Network.

This multi-chain strategy could allow Peg-BTC to become an interoperable standard for BTC tokenization across different DeFi networks. Audits and bridge testing are ongoing, aiming for broader deployment in the coming weeks.

While securing BTC flows is a technological priority, this advancement raises questions about the future of DeFi. By providing an asset historically seen as passive, Bitlayer transforms Bitcoin’s nature in yield and liquidity dynamics. The growing involvement of players like SUI in this dynamic suggests that BTCFi is on its way to structuring itself as an autonomous segment, with its own standards, products, and governance logics. In this context, interoperability could quickly become an essential standard for the multi-chain ecosystem.

Maximize your Cointribune experience with our "Read to Earn" program! For every article you read, earn points and access exclusive rewards. Sign up now and start earning benefits.