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June 26, 2022
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Square is creating a new DeFi business focused on Bitcoin

Square CEO Jack Dorsey announced the launch of the developer platform. All this so that they can create non-trust decentralized financial projects built around Bitcoin.

Dorsey added that the project will be completely open-source, as will his new hardware wallet. He further stated that the team will be built and led by Square’s strategic development leader Mike Brock.

Square creates a new company (joining Seller, Cash App and Tidal) focused on building an open development platform with the sole purpose of facilitating the creation of unlicensed, unenforced and decentralized financial services. Our main goal is #Bitcoin. Its name is TBD.

– we can read in tweet.

Dorsey added that a project called TBD will be different from Square Crypto, an open-source project development organization.

TBD will focus on building the platform business and will open source our work along the way.

In response to the tweet, there were comments about the existence of Ethereum. Some in the community have suggested that Square’s attempt is another attempt to come up with something that’s already working.

Entry into DeFi Bitcoin

The interesting part, however, was the focus on Bitcoin. Why? Because BTC currently has no way to make smart contracts, making it difficult to compete with Ethereum in the DeFi world.

FT noted that the Bitcoin network was historically thought to be slower and less efficient than its Ethereum counterpart.

In November, it will receive the first major update in several years, called Taproot, which will facilitate the creation of smart contracts online. Taproot is a soft fork of Bitcoin that promises more secure, private and lightweight transactions, making the network more scalable and helping to lower transaction fees.

This will be a much-needed boost for Bitcoin-based DeFi, which Dorsey seems to predict.

Square’s revenue more than doubled in 2020, largely due to an increase in transactions on its peer-to-peer Cash App mobile payment platform.

Ethereum still dominates DeFi

Decentralized finance is still primarily the domain of Ethereum.

As of this writing, the TVL of all DeFi protocols is around $ 82 billion according to DappRadar, an increase of 273% year on year

According to the platform, there is also about $ 6.3 billion locked in wrapped BTC, a tokenized version of Bitcoin on the Ethereum network. This figure has almost doubled since the beginning of the year, highlighting the demand for Bitcoin-based DeFi.

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