Bitcoin’s evolving role in the decentralized economy
ETH Denver 2025 was a clear signal: Bitcoin is no longer just a store of value. It is becoming a programmable foundation for decentralized applications, governance models, and financial systems.
At RootstockCollective, we believe in Bitcoin’s potential to serve as the backbone of Web3. This year’s conference validated that belief, with discussions centred around Bitcoin Layer 2 solutions, decentralized governance, and new funding mechanisms to accelerate adoption.
Rootstock is uniquely positioned to enable this transition as the oldest and longest-running Bitcoin sidechain, bringing smart contract capabilities, security, and a thriving developer ecosystem to Bitcoin.
Key takeaways from ETH Denver 2025
1. Bitcoin Layer 2s are no longer an afterthought
For years, Bitcoin scaling discussions were limited to Lightning Network, but this year saw Bitcoin Layer 2 solutions take centre stage. Ethereum builders and investors recognize the need for programmability on Bitcoin, and Rootstock’s ability to offer EVM compatibility while leveraging Bitcoin’s security stood out in multiple discussions.
What This Means: Bitcoin-native DeFi, governance, and dApps are no longer theoretical – they are being built right now, with Rootstock leading the charge.
2. Modular DeFi is driving interoperability
The Encode Modular DeFi Hackathon was a standout moment, showcasing innovative projects leveraging Rootstock for real-world use cases.
We saw builders experiment with:
- Cross-chain liquidity between Bitcoin and Ethereum
- New governance models for sustainable DAOs
- Bitcoin DeFi integrations enabling new forms of value capture
The Future: Modular DeFi is creating new ways to build on Bitcoin, and Rootstock is positioned as a critical infrastructure layer for this shift.
3. Sustainable DAOs need revenue models
Governance was a significant theme at ETH Denver, with discussions highlighting the need for long-term sustainability in DAOs.
One of the biggest challenges for DAOs today is financial sustainability. How can decentralized organizations fund themselves without relying solely on initial token sales?
At RootstockCollective, we are constantly working to set new precedents and ensure sustainable, scalable growth. Updates coming soon.
Key Takeaway: DAO sustainability requires real economic models, and Bitcoin Layer 2 solutions like Rootstock provide a foundation for long-term funding for decentralized ecosystems.
4. Institutional interest in Bitcoin DeFi is growing
ETH Denver 2025 wasn’t just about developers—institutional players are beginning to pay serious attention to Bitcoin Layer 2 solutions.
Investment firms, liquidity providers, and venture capitalists are actively exploring yield-generating opportunities within Bitcoin DeFi. RootstockCollective’s backer incentives, Collective Rewards, and governance structure present a compelling model for institutional participation.
Next Steps: We expect increased engagement from institutional stakeholders looking to participate in decentralized governance and funding mechanisms.
5. Governance is the missing link for Bitcoin’s expansion
One of the clearest insights from ETH Denver was that Bitcoin lacks structured governance mechanisms to coordinate large-scale innovation.
While Ethereum has DAOs, grant programs, and ecosystem funding models, Bitcoin remains largely dependent on centralized actors for development.
RootstockCollective aims to fill this gap, enabling:
- A decentralized funding model for Bitcoin builders
- A governance structure that aligns incentives across the Rootstock ecosystem
- A sustainable mechanism for long-term Bitcoin innovation
Big Picture: For Bitcoin to scale beyond its role as a store of value, it needs decentralized governance structures—and RootstockCollective is building the framework for that future.
The road ahead: Bitcoin’s next leap
ETH Denver 2025 showcased a turning point for Bitcoin’s integration into Web3. The conversations around scaling, governance, and DeFi opportunities indicate that Bitcoin is no longer an isolated asset—it is becoming a foundational layer for decentralized innovation.
At RootstockCollective, we believe Bitcoin’s full potential will only be unlocked through decentralization, governance, and financial sustainability.
If you’re a builder, check out our grants program.
If you’re a backer, start staking RIF and participate in governance.
Bitcoin’s decentralized future is being built now. RootstockCollective is here to make it a reality.