New CeDeFi Platform on Core: What is BitFi?

The cryptocurrency landscape continues to evolve, and Bitcoin is no longer just a store of value. With the rise of Bitcoin DeFi, we’re seeing a new era where Bitcoin holders can earn passive income using advanced decentralized applications. One of the standout platforms pushing this frontier is BitFi, a new CeDeFi protocol built on the Core blockchain.

What Is BitFi?

BitFi is a cross-chain liquidity and yield platform designed for Bitcoin holders. It operates on a hybrid model, combining the structure of centralized finance (CeFi) with the flexibility and transparency of decentralized finance (DeFi). This architecture allows users to access real BTC yield opportunities with better security, scalability, and composability.

Unlike traditional DeFi platforms that started on Ethereum, BitFi taps into Bitcoin’s robustness. The platform integrates advanced financial strategies with user-friendly staking mechanics, creating a streamlined experience for users.

The Rise of BitFi: Born from Taproot

Bitcoin’s Taproot upgrade, launched in 2021, made it possible to build dApps directly on the Bitcoin network. This update unlocked the potential to develop smart contract-based platforms like BitFi, which rely on secure, programmable infrastructure.

BitFi is one of the first protocols to leverage Taproot's capabilities. Its core objective is to provide native yield opportunities for BTC holders while addressing the persistent liquidity and efficiency challenges in the broader Bitcoin ecosystem.

What Makes BitFi Different?

By combining the benefits of CeFi (such as institutional-grade custody and market access) with the permissionless nature of DeFi, BitFi offers:

• Multi-chain support across Bitcoin, BNB Chain, Bitlayer, and Hemi.
• Stable and predictable APYs exceeding 4.5% annually.
• Robust asset management with a reported TVL of over 4,500 BTC or $240 million.
• Institutional backing, including partnerships with names like Ceffu, the institutional arm of Binance.

Enter bfBTC: Real Yield for Real Bitcoin

At the heart of the BitFi protocol is bfBTC, a real-yield bearing token backed by native BTC deposits. When users deposit BTC into BitFi, it’s held securely by Ceffu. The funds are then deployed into delta-neutral quantitative strategies, allowing users to earn consistent BTC yields without exposing their assets to price volatility.

The yield earned is reflected through the bfBTC exchange rate, which increases over time. Users can stake BTC, receive bfBTC in return, and use it across various DeFi applications for additional earnings.

Unlike traditional staking, bfBTC allows capital efficiency. You retain liquidity while earning passive yield in real BTC.

How the Strategy Works

BitFi employs delta-neutral strategies, which involve:

• Long spot BTC positions for stable exposure.
• Short perpetual futures to hedge against price swings.
• Earnings from funding rate arbitrage and basis spreads.

According to the team, these strategies allow BitFi to earn yield even during market downturns. And because the platform uses Ceffu’s MirrorX infrastructure, it enables off-exchange execution while maintaining full custody of user funds.

CeFi and DeFi Working in Sync

BitFi's architecture brings both centralized and decentralized components together:

CeFi Features:

• Custody by Ceffu, ensuring top-tier asset security.
• Integration with Binance's liquidity through MirrorX.
• Quantitative strategies for yield optimization.

DeFi Features:

• Issuance of bfBTC and bfUSD, which can be used across DeFi protocols.
• Full transparency with on-chain fund tracking.
• Liquidity staking opportunities and composability within DeFi apps.

Thus, Bitcoin holders are able to interact with a platform that feels familiar but operates with the innovation of Web3.

Liquidity Made Easy

With BitFi, users gain access to one-stop yield management. You don’t need to manually manage multiple positions or move assets between exchanges and wallets. BitFi takes care of everything—from asset custody to strategy deployment—and provides real-time returns.

Plus, bfBTC and bfUSD tokens are ERC-20 compatible, making them usable in a wide range of DeFi platforms for lending, swapping, farming, and governance. This composability unlocks multiple yield layers from a single BTC deposit.

Unstaking and Flexibility

Users can choose to unstake their assets back to the Bitcoin network or an EVM-compatible network like BSC, Bitlayer, or Hemi. The unstaking process requires processing time due to the epoch-based yield updates, which may cause slight differences between expected and received amounts.

The key is flexibility. Whether you're a long-term BTC holder or an active DeFi participant, BitFi lets you move in and out of strategies on your terms.

Final Thoughts

For years, BTC was seen as a static store of value. Platforms like BitFi are now rewriting that narrative.

By offering real yield in BTC through advanced, institution-grade strategies and DeFi flexibility, BitFi has established itself as a serious contender in the CeDeFi space. 

BitFi could become a pivotal piece of infrastructure that brings passive income opportunities to millions of Bitcoin holders around the world.