Bitcoin has held onto a trillion-dollar market cap even through a deep bear market, yet only a small fraction of that capital is being used in onchain finance.
According to DefiLlama, BTC deployed in DeFi is currently worth about $4.3 billion, less than 0.33% of Bitcoin’s total market value. Using the article’s cited figure of $1.31 trillion in market capitalization, that leaves more than 99.6% of BTC sitting in wallets without generating yield, backing loans or serving as collateral in broader financial products.
That gap is the backdrop for Hashi’s latest rollout. In July, Hashi launched its testnet on Sui, giving developers, custodians, financial institutions and ecosystem partners a working environment to build integrations and run stress tests for Bitcoin-backed financial applications ahead of mainnet.
The article’s core argument is that Bitcoin’s next phase may not be defined by store-of-value demand alone. Utility, especially in collateralized and programmable finance, is becoming part of the conversation.
Guardian Layer adds a second line of verification
Hashi introduced its Guardian Layer at the same time as the Sui testnet launch.
According to the official description cited in the article, Guardian Layer is a defense-in-depth security architecture built for institutional BTC collateral management. It sits on top of Hashi’s existing threshold-signature mechanism, under which moving funds already requires approval from one-third of Sui validators, and adds a separate verification layer beyond that base system.
All BTC collateral is placed under a 2/2 multisig structure. Releasing BTC requires both an MPC signature from Hashi validator nodes and a Guardian signature. The design is meant to provide an added safeguard against validator misconduct and broader system risk.
The piece explains defense-in-depth as a classic security engineering approach: rather than relying on a single control point, it layers independent protections so that if one mechanism fails, others remain in place.
For institutions, that means collateral monitoring no longer depends on one checkpoint alone. Each capital movement passes through multiple independent checks, a structure the article says gives lending and credit markets a more durable security foundation.
Wave Digital Assets makes a three-year commitment
Among Hashi’s day-one testnet partners, Wave Digital Assets LLC received particular attention.
The firm, described in the article as an SEC-registered investment adviser, participated in Hashi’s early buildout and has committed to use best efforts over the next three years to prioritize the tokenization of Bitcoin yield bond products on the Sui protocol through Hashi.
The commitment amounts to a clear bet on a specific thesis: that a programmable Bitcoin fixed-income market is ready for institutional adoption.
Wave CEO David Siemer had previously said, “Hashi is the missing credit layer that now fills the gap and provides institutions with stable native yield.”
More than 25 partners join the testnet ecosystem
At launch, Hashi said its testnet ecosystem included more than 25 partners across the Bitcoin finance stack.
Custody and wallet integration
- BitGo, listed as an institutional custody client
- Blockdaemon
- Cobo
- Fordefi, a Paxos company focused on institutional wallets and infrastructure
- Cubist, which provides cross-chain collateral infrastructure
- Ledger, described as a self-custody service provider
- SwissBorg, serving European ultra-high-net-worth retail and institutional asset management wallet users
Lending, trading and liquidity
- Bullish, an institutional digital asset platform
- Cumberland, an institutional crypto market maker and liquidity provider
- Erebor, identified as an OCC-chartered bank
- FalconX, an institutional prime brokerage
DeFi and lending applications
- AlphaLend
- Bluefin
- Current
- Scallop
- Suilend, described as a native Sui DeFi protocol supporting retail lending from day one
- Fluid, a capital-efficient system connecting lending, liquidity and other financial products
- Navi, one of the largest and longest-running DeFi protocols on Sui
Treasury and asset management
- Concrete by Blueprint Finance, a yield infrastructure platform
- Inveniam Capital, focused on RWA yield strategies
- Wave Digital Assets LLC
Indexes, oracle services, insurance and security audits
- CF Benchmarks, a crypto index provider connected to oracle infrastructure
- Soter Insure, described as BTC-denominated institutional crypto-native insurance
- Asymptotic
- Certora
- OtterSec, focused on smart contract security and formal verification audits
The article notes that formal verification uses mathematical methods to prove that code behavior matches design specifications, offering stronger correctness guarantees than standard code audits, a feature it says is especially important for institutional financial products.
It also says that when Hashi’s devnet was introduced earlier this year, more than 20 day-one partners had already committed to building on the protocol and deploying capital. With the testnet now live, that partner base has expanded and stretches beyond infrastructure into broader financial services.
“Bitcoin won’t be an exception”
Mysten Labs co-founder and Chief Product Officer Adeniyi Abiodun said, “All major assets eventually developed highly creditized lending and liquidity markets, and Bitcoin will not be an exception. Hashi is giving developers and infrastructure providers the secure, transparent and onchain programmable opportunity they have been waiting for.”
The article places weight on that statement not as a slogan, but as a framework for how BTC could evolve from passive holding into an asset class with deeper credit and liquidity rails onchain. It points to gold, real estate and sovereign debt as examples of major assets that moved from passive ownership toward active credit markets.
Developer tools and tax analysis are already available
Hashi’s developer SDK documentation, integration guides and technical resources are now available at sui.io/hashi.
On tax treatment, the article cites a prior legal analysis from Fenwick stating that locking BTC through Hashi and receiving the receipt token hBTC should not be treated as a taxable event under U.S. federal income tax law, because hBTC represents ownership of the underlying BTC rather than a separate asset.
The article illustrates that view with a coat-check analogy: receiving a claim ticket when you check in a coat, and later using that ticket to retrieve it, does not transfer ownership. Under that reasoning, the lock-and-receipt process would not itself create a taxable event.
From devnet to testnet, Hashi is moving the discussion around Bitcoin utility toward an onchain financial infrastructure that can be tested, programmed and supervised.