Bitcoin lending and yield could drive next wave of institutional demand, Rootstock says
A RootstockLabs report argues that lending, yield generation and balance-sheet financing could broaden Bitcoin’s institutional role beyond a store of value. It estimates only 1.5% of BTC supply is used in lending and Bitcoin-native finance, while identifiable institutions hold about 3.9 million BTC. In a hypothetical scenario where institutional holdings double, a 5% yield on 5% of holdings would generate 19,500 BTC annually; the report says this is not a demand forecast. RootstockLabs cites MARA’s $750 million in Bitcoin-backed loans as an example of using BTC collateral to finance infrastructure while retaining holdings. The report also flags risks including leverage, rehypothecation, defaults, custody failures, legal enforceability and concentration among custodians, while arguing that on-chain verification and programmable liquidation can mitigate some risks.
