Stacks is built on Bitcoin because Bitcoin is the most secure, reliable and decentralized blockchain. Bitcoin layers extend Bitcoin’s functionality without changing Bitcoin itself and compromising its security or decentralization. sBTC, the upcoming 1:1 Bitcoin backed asset, enables Stacks smart contracts to write to Bitcoin – unlocking the value of Bitcoin and enabling previously dormant use cases. Here’s a quick look at 10 ways that sBTC will unlock the power of Bitcoin.

Bitcoin DeFi will enable decentralized ways to earn yield on BTC. Yield is generated by putting idle capital to work, for example through lending or securing a network or application.

With Bitcoin DeFi, it will become much safer to use BTC as collateral to borrow against. Bitcoin is a digitally native scarcity asset. Its limited supply and near instantaneous transferability makes it a perfect asset to borrow against.

Bitcoin DeFi will make it much easier for users to swap in and out of BTC. Today, users rely almost exclusively on centralized exchanges to buy/sell BTC. However, this comes with challenges as we’ve recently seen with FTX’s collapse.

Bitcoin is a volatile asset, and its price can fluctuate rapidly. sBTC allows users to manage BTC risk by swapping it for stablecoins during periods of high volatility. This reduces the risk of losses and allows users to take advantage of market opportunities.

sBTC can be used to support causes and create new art and assets. sBTC presents an opportunity for artists and charitable or cause-focused leaders to sell their art/NFTs and get funding for their efforts. Unlocking Bitcoin capital ultimately creates tons of funding opportunities through NFTs.

Similar to how sBTC converts BTC into sBTC on the Bitcoin layer that can then interact with smart contracts, the same concept can be applied to Ordinals. sBTC will enable the conversion of Bitcoin ordinals into non-fungible tokens, enabling scaling opportunities as Ordinal trading fees on the Bitcoin mainchain become too expensive as trading activity increases.

NFTs have become a large phenomenon on other chains. With sBTC, it will be possible to buy and trade NFTs for Bitcoin on a Bitcoin L2. This unlocks a large amount of Bitcoin capital.

With sBTC, you can now use your NFTs as collateral to receive a loan in sBTC. This innovative new use case allows you to access liquidity without having to sell your prized digital assets. Invest, expand, and keep building your collection with confidence, knowing that you can now leverage your NFTs to unlock more capital.

sBTC can be used to swap assets in a trust-minimized way. Users can swap their BTC for other assets in a decentralized way, without having to rely on centralized exchanges.

Okay, there’s too many use cases for one roundup of 10 examples, so we’re sneaking a few more into this last category. Bitcoin is a highly valuable asset, but its use in DeFi is limited due to its lack of interoperability with other tokens. By converting Bitcoin to sBTC, users can unlock its value and use it in various DeFi applications, such as lending protocols and stablecoin swaps, crowdfunding with Bitcoin, creating a Bitcoin-backed mortgage app, and so much more.

We'll be releasing more use case examples and creative ways to leverage sBTC to harness the power of Bitcoin - stay tuned.