Branden Sedo, an early contributor to the Bitcoin sidechain Core DAO, told Cointelegraph at Korea Blockchain Week that the trillions of dollars of capital currently held in the Bitcoin ecosystem will begin to be deployed on-chain over time, eventually leaving the Ethereum network behind.

“If you look at Bitcoin, there is over $1 trillion of capital sitting there,” he said.

Assuming that Bitcoin continues to gain value and attracts more institutional capital through exchange-traded products (ETPs), it is not difficult to imagine that a significant portion of this capital will be used in Bitcoin sidechains and other Bitcoin-based DeFi applications, Sedo noted.

“You may see a lot of that capital move onto the chain, especially as solutions like reliable bridges and roll-ups emerge.”

“It makes complete sense to move some liquidity onto-chain and create more opportunities for Bitcoin,” he added. The approval of spot Bitcoin ETFs earlier this year put Bitcoin’s scalability into the spotlight and led to a massive increase in development activity and market interest in Bitcoin sidechains such as Core, Bitlayer, and Stacks.

However, Sedo said that if Bitcoin’s DeFi total value locked (TVL) is to surpass Ethereum, more Bitcoin users will need to get used to the idea of ​​running their Bitcoin, an idea that has been overshadowed by the collapse of platforms like BlockFi and Celsius in 2022.

Many people who lost their Bitcoins in this crash were vociferously and staunchly opposed to any profitable means of putting their Bitcoins to work, refusing to do anything other than keep their Bitcoins in a cold wallet.

“A lot of people have lost Bitcoin. I’ve lost Bitcoin myself. Losing Bitcoin is not a nice thing to do. It sucks. So there’s understandable skepticism towards these new things,” he said.

However, Sedo notes that many Bitcoin users are starting to notice a shift in their attitudes towards using their Bitcoin, especially when it comes to non-custodial DeFi applications.

After returning from the Bitcoin 2024 conference in Nashville, he said the “atmosphere was pretty constructively oriented” and the general attitude was one of surprise at the “explosion of the possible” on the Bitcoin network.

Sedo said he has “a lot of confidence” in Core’s approach to staking, as Core is completely non-custodial, and that Core’s bridge, which allows users to bridge stablecoins and native CORE tokens, is the only major bridge in the crypto space that has not been subject to major exploitation He said that it is supported by LayerZero, one of its protocols.

When using Core Chain, users time-lock their Bitcoin — so they don’t have to worry about custody or handing over their private keys — in return they receive a 3% return in the form of CORE tokens, which are used for gas fees and governance on the network. is used.

Core recently overtook Bitlayer to become the largest Bitcoin sidechain, with $314.4 million in TVL and 5,541 BTC staked on its network — worth $321 million at current prices.

At the time of publication, Core accounts for 26.4% of the total TVL among all Bitcoin sidechains, according to DeFiLlama data.