The surging growth of BTC may change the landscape of Crypto Assets in the Ethereum DeFi ecosystem.

Bitcoin and Ethereum, as the two giants in the crypto assets field, have long had distinctions in their monetary attributes. Bitcoin is typically seen as a base currency, likened to "digital gold" and "the anchor of the crypto world," while Ethereum places more emphasis on the application layer, with practitioners often focusing on its "currency applications" at a higher level, such as over-staking ETH to create "derivative coins."

However, the thriving DeFi ecosystem seems to be breaking this division of labor, even making Ethereum somewhat overshadow the currency role: the ERC-20 format Bitcoin ( "anchored BTC" ) has rapidly expanded in recent months, especially in the past July, where the issuance of anchored BTC increased by about 70%. Data shows that as of August 5, the total issuance of anchored BTC in the Ethereum ecosystem has reached 20,472 coins, approaching 1% of the total Bitcoin supply and accounting for 0.59% of the total ETH market value.

From the perspective of anchored BTC, wBTC holds an absolute majority with a 75.8% issuance share, while Ren BTC and sBTC rank second and third with shares of 11.2% and 4.89%, respectively. Together, these three account for over 90% of the share, highlighting their important position in the anchored BTC sector.

From an on-chain indicator perspective, these three BTC-pegged assets stand out in terms of total addresses, active address ratio, and large transfers. In July, renBTC saw the most astonishing increase in total address count, reaching 111%; wBTC's total address count increased by approximately 17%. In terms of active address ratio, the average for all three is above 5%, better than ETH during the same period, and comparable to USDt-erc20. Among them, renBTC is particularly outstanding, with an average active address ratio of 42.78%.

In terms of large transfers and transfer amounts, wBTC and renBTC have carried considerable value transfer. The peak of large transfers for wBTC within 30 days reached 20,000 BTC, with an average transfer amount of nearly 50 million USD over 7 days; renBTC's peak of large transfers within 30 days approached 1,300 BTC, with an average transfer amount of about 11.5 million USD over 7 days.

Behind the explosive growth of BTC, there are two key factors: first, major lending projects have opened staking, and second, the surge of liquidity mining. In May, a certain lending platform proposed in the community to add wBTC as collateral for generating stablecoins, which greatly enhanced the development space for stablecoins. According to data, as of August 1, nearly half of the wBTC was staked on that platform.

The "liquidity mining" boom that started in mid-June has driven the development of the entire BTC-pegged sector. The liquidity incentive pools launched by multiple platforms have attracted a large influx of funds. According to data, as of August 1, the total amount of funds in a certain liquidity incentive pool has approached 35 million USD.

Despite the rapid development of BTC anchoring, its growth bottlenecks are becoming increasingly evident. First, there is insufficient scalability, limited by the overall market capitalization of DeFi and the issuance mechanisms of various coins. Secondly, the process from generation to use remains relatively complex, with numerous risks that hinder greater user participation. In addition, the high proportion of holdings by whales is also a problem, which may affect the broad distribution of tokens.

There are differing opinions within the industry regarding the development of BTC pegging. Some believe it may reduce on-chain Bitcoin transactions, affecting miner revenue and network security. Others argue that it is a win-win situation for both Bitcoin and Ethereum, as it can expand the application scope of Bitcoin while enhancing network economic activity and liquidity for Ethereum.

In the past week, the on-chain indicators primarily anchored to BTC have shown signs of fatigue, even exhibiting a downward trend. As the enthusiasm for liquidity mining gradually wanes, it remains to be seen whether the BTC anchor can continue to maintain stable growth.