For Bitcoin DeFi, the new Square business will have a “open plan, open development, and open source.”
The platform will put pressure on Ethereum-based DeFi, which features smart contracts and interoperable ‘Money Legos.’
Square, Inc.’s founder and CEO, Jack Dorsey, has announced a new Square business that would deliver Bitcoin DeFi services via Twitter. In accordance with Square’s companies, the new division will join Seller, Cash App, and Tidal. The major goal of creating such a platform, according to Dorsey, is to deliver “non-custodial, permissionless, and decentralized financial services.” The Square company, dubbed TBD, will mostly use Bitcoin.
TBD, like Twitter’s new Bitcoin hardware wallet, will be available to the public, according to the co-founder and CEO of Twitter Inc. In addition to being open source, the company’s roadmap and development will be visible to the public.
Dorsey then named engineer Mike Brock as the TBD team’s leader, who in turn appointed a founding team. Brock was part of the programming team that implemented Bitcoin functionalities into Cash App in 2018. He also worked at Red Hat Inc., an open-source solutions company, which gave him a lot of experience in the sector.
Part of Dorsey’s Tweet read, “…we have some thoughts around the initial platform primitives we want to construct.”
TBD for a new business unit in Square.
Because of Square’s reputation, the TBD platform is likely to increase competition for Ethereum-based DeFi. The Bitcoin network, on the other hand, has yet to add smart contract support, which Ethereum-based DeFi now has. Ethereum is also proud of its programmable ‘Money Legos.’ For the time being, Bitcoin’s DeFi is entirely reliant on third-party infrastructure such as side chains and bridges to execute smart contracts.
According to data from DeFi Llama, Ethereum currently ranks first among the top 100 DeFi platforms in terms of total value locked (TVL). With a TVL of $9.09 billion, AAVE is at the top of the list. Binance, whose platforms include the eighth-ranked PancakeSwap, with a $3.76 billion TVL, is a competitor to Ethereum.
According to DeFi Llama, the Lightning Network is the highest-ranked Bitcoin-based project, ranking 103rd with a $58.7 million TVL. Nonetheless, utilizing TVL to assess the utility of the Lightning Network may not be the ideal method.
Ethereum-based DeFi has seen enormous growth this year, according to statistics from Dune Analytics. In July, the whole DeFi user base had increased to around 3 million unique addresses. From 1.1 million at the start of the year, this figure has increased by 172.7 percent.
More Bitcoin blockchain advances
Aside from Square’s latest DeFi effort, the Taproot upgrade is another factor that could boost BTC-based DeFi acceptance. According to reports, the upgrade will be completed in mid-November and will allow for the use of BTC smart contracts. Dorsey has recently hinted that the Tidal streaming service would include blockchain technology like NFTs or smart contracts.
Prior to the Bitcoin DeFi announcement, Square CEO Jack Dorsey announced on Twitter that the company would be releasing a Bitcoin hardware wallet. The device would offer assisted custody to make the process easier for regular users.
Related: Square Crypto, led by Jack Dorsey, is funding Bitcoin development.
TBD Bitcoin Square Inc/n
