Bitcoin’s main attraction has all the time been its potential for important capital appreciation. Nevertheless, not like Ethereum and Solana, which provide staking rewards to holders, Bitcoin lacks an easy technique for producing yield. Historically, traders have resorted to lending their Bitcoin to earn curiosity. But, this strategy carried important dangers, notably on account of rehypothecation, the place belongings have been used as collateral for additional lending. This apply led to a credit score bubble that in the end burst in 2022, leading to widespread insolvencies and a lack of belief in lots of sides of the market.
