Bitcoin DeFi Still Needs User-Friendly Tools to Increase Accessibility
Over the years, Bitcoin has evolved into more than just a store of value. First, through wrapped BTC tokens on other blockchains and more recently through DeFi innovation in Bitcoin. BTC holders may finally be able to leverage their assets across diverse DeFi protocols within the Bitcoin ecosystem itself.
Now, the recent institutional interest and major inflow into BTC through ETFs has boosted trust in the asset and is likely to bring in a huge number of users to Bitcoin.
However, Bitcoin still lacks the necessary tooling that can enable users to seamlessly participate in Bitcoin’s DeFi. Platforms like Tomo are making it easier for general users and retail investors to join the Bitcoin ecosystem without any hassle.
Before we talk about how user-friendly tools like Tomo wallet will bring wider retail adoption of Bitcoin-based platforms, let’s first see how Bitcoin is spearheading the ongoing crypto boom.
Unleashing The Potential Of Bitcoin’s Use Cases
In January 2024, the US Securities and Exchange Commission (SEC) approved 11 Bitcoin exchange-traded fund (ETF) applications.
As a result, by February, almost 75% of new Bitcoin investments came from ETFs. Market data suggests that the average trading size is around 326 shares or $13,000, coming primarily from non-professional investors.
Apart from institutional maturity and regulatory safeguards, the Bitcoin network has also undergone massive technical advancements. For instance, Casey Rodarmor has launched the Ordinals and Runes protocols for Bitcoin-native NFTs and fungible tokens respectively.
Currently, there are more than 66 million Ordinals inscriptions with a potential $4.5 billion Bitcoin NFT market by 2025. Besides crypto natives and degens, major institutions have also shown interest in the Ordinals market.
On the other hand, Runes has the highest transaction share on the Bitcoin network after its launch in mid-April. According to Rune Alpha, there are more than 517K Rune holders with a market cap of over $3 billion.
Runes can bolster the Bitcoin community, introduce DeFi options, and bring more retail users through memecoins.
Despite the opportunities from Bitcoin ETFs, Ordinals, and Runes, retail investors are not coming into Bitcoin as much as they should. Cointelegraph Magazine reported that new addresses on Bitcoin have reached a two-year low and are hovering around 267,000.
The data suggests that most of the Bitcoin activity is primarily driven by veteran crypto users, degens, and seasoned investors. New retail investors are not jumping into the Bitcoin bandwagon because the entry barriers remain high.
For example, first-time users often have to navigate complex web3 wallets to store their digital assets and make purchases. Without prior technical knowledge, it becomes difficult to access the Bitcoin ecosystem.
Therefore, users need easy-to-use and simple tools to participate in the Bitcoin economy.
The Need For Easy Accessibility To The Bitcoin Ecosystem
The first thing a user needs to access blockchain applications is a web3 wallet to store BTC and other Bitcoin-based assets like Ordinals and Runes. Unfortunately, a lot of wallets have a complicated interface, weak security, and limited asset support functionalities. Moreover, users have to carefully store the seed phrase and private key to access their wallets and sign transactions.
However, some crypto wallets make it simpler for users to access web3 apps without any hassle.
The Tomo wallet is an Externally Owned Account (EOA) wallet that lets users easily store BTC and other Bitcoin-based fungible and non-fungible assets in one place..
The unique wallet’s social login feature lets users create a wallet using their email ID or X handle. This makes it very easy to operate a web3 wallet compared to other wallets.
Further, the wallet’s Multi-Party Computation (MPC) technology leverages cryptography to protect user data without revealing any sensitive information.
Tomo wallet will also help users access Bitcoin DeFi services like staking, lending-borrowing, or trading Ordinals. One such feature will launch soon where users will be able to stake BTC on Babylon through their Tomo wallet.
To bolster DeFi composability, Babylon has introduced a method where BTC holders can stake their assets by directly locking them on the Bitcoin chain. Babylon bypasses the need for third-party custody and leverages Bitcoin’s value to support Proof-of-Stake (PoS) chains.
Consequently, PoS chains can tap into the highly secure Bitcoin network and the locked liquidity of BTC reserves while offering rewards to stakers. Thus, the Tomo wallet creates a bridge between the decentralized economies operating outside Bitcoin and connects it with BTC’s abundant liquidity.
Tomo has further plans to partner with several other projects in the Bitcoin ecosystem.
Among the many collaborations in the pipeline are the Bitcoin Layer2, BSquared Network, the Bitcoin-native data availability layer, Nubit, and Bitcoin restaking platform, Lombard. Other projects include the cross-chain liquidity protocol, OpenBit.
Thus, Tomo serves as an example of how simple tools can make the Bitcoin ecosystem more accessible and open up new avenues for general users.
Democratizing Bitcoin Accessibility
As the DeFi Summer approaches, the Bitcoin economy will expand and record a spike in user activity. However, if Bitcoin is to become a true alternative to the traditional financial system, it must simultaneously onboard institutional and retail investors.
Satoshi Nakamoto dreamt of a system where users wouldn’t have to rely on centralized banks and governmental institutions for everyday financial activities. To realize Nakamoto’s vision, it is imperative to democratize access to Bitcoin and make it an egalitarian space for everyone.
To this end, web3 tools like social login-enabled Tomo wallet make Bitcoin accessible to all kinds of users, irrespective of their technical knowledge. As we progress further, the entry barriers will hopefully become easier with simpler tools and more technical advancements.
About Tomo
Tomo is an all-in-one Web3 social app that transforms users’ online presence into a universal social wallet, fostering genuine, spam-free connections and financial incentives. Tomo lets users engage directly with creators, participate in private discussions, and explore the new generation of digital art with Tomoji. Active participation earns users Tomo Points, enhancing your social capital. Join Tomo, where your social capital is valued.
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