Smart contracts and staking arrive on Bitcoin’s base layer

From a cypherpunk idea to a trillion-dollar asset class, Bitcoin (BTC) has grown dramatically since its genesis block. Still barely a teenager as an asset, BTC has evolved into a globally recognized store of value.

Even as the world’s most secure blockchain, Bitcoin has long lacked the programmable flexibility that powers decentralized finance (DeFi). Without native smart contracts, it has ceded ground to platforms such as Ethereum, limiting what users can do with their BTC beyond basic transfers or custodial staking.

The absence of onchain DeFi forces holders either to trust centralized services or to wrap their coins on other networks — solutions that undermine Bitcoin’s hallmark of trustless security.

That gap is beginning to close. Recent years have witnessed the emergence of new approaches to bring programmable functionality directly to Bitcoin. One of them is Ordinals, an inscription protocol that lets individual satoshis — the blockchain’s smallest unit — carry unique on‑chain data. This innovation enabled NFTs on Bitcoin while also laying the groundwork for more complex applications, like DeFi protocols.

Bringing full DeFi stack to Bitcoin

Building on this foundation is Tap Protocol, an Ordinals-based solution that aims to deliver a complete DeFi toolkit while settling every transaction on Bitcoin’s native layer.

Its L1 co-processing feature enables developers to leverage smart contracts from other layer 1s to co-process transactions on Bitcoin. All transactions settle directly on Bitcoin's layer 1, providing users with native security.

With Tap, decentralized swaps, automated market makers (AMMs) and staking all run natively, no custodial bridges or wrapped tokens required.

The protocol’s native bridge also connects Bitcoin to ecosystems such as XRP, Arbitrum, Solana and Internet Computer Protocol (ICP), widening liquidity without compromising security.

Tap puts a strong emphasis on accessibility. For builders, Tap supplies extensive documentation, testnets and multi‑language support; for users, it offers a straightforward and friendly interface that hides the technical complexity.

Additional revenue stream for Bitcoin miners

Earlier this year, the protocol also introduced a miner revenue mechanism that automatically distributes NAT tokens to miners alongside the standard BTC block reward. Because it relies solely on existing block data, the system demands no changes to Bitcoin’s code or to miners’ workflows.

The amount of NAT released per block is determined by hash power, making it fully regulated by the state of Bitcoin mining. This is enabled by the Digital Asset Matter (DMT), a framework that ties token issuance directly to Bitcoin’s block data.

Source: Tap ProtocolThe scheme has already drawn interest from industry heavyweights: Antpool, one of Bitcoin’s largest mining pools, was among the first to opt in, signaling growing acceptance of Bitcoin‑native application layers. By adding a revenue stream, Tap helps foster a more active, self-reinforcing ecosystem around Bitcoin’s core infrastructure.

Powering a Bitcoin DEX

Tap is already powering several high-demand protocols on Bitcoin. One of them is Trac Network, a blockless, local-first layer-1 network for real-time peer-to-peer apps. Trac brings both DeFi and scalability to Bitcoin while allowing users to retain control of their assets.

Tap’s ‘Token Authority’ feature unlocks the integration. The feature enables Tap users to grant Trac apps access to Tap tokens until they opt to withdraw them back to their own Bitcoin wallet.

A manifestation of this integration is Hypermall, a decentralized exchange (DEX) platform built on Trac Network. Hypermall allows users to trade any Tap Protocol–based Bitcoin asset with near-instant finality and without relying on custodial bridges or wallets connected to third-party websites.

Source: Tap Protocol## Building a native Bitcoin DeFi ecosystem

Tap Protocol helps to take Bitcoin from being a simple store-of-value to a dynamic ecosystem with native DeFi capability. By introducing smart contract functionality, crosschain interoperability and miner revenue — all on Bitcoin’s base layer — Tap is removing long-standing barriers to utility and innovation.

Its vision is rooted in expanding what Bitcoin can do while preserving its core principles. The protocol doesn’t just enable DeFi on Bitcoin; it aligns the tools with Bitcoin’s original ethos of trustlessness, transparency and user control. Tap is helping pave the way for a future where Bitcoin powers more than just value storage — it powers open, programmable finance.

Learn more about Tap Protocol

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• #Blockchain
• #Smart Contracts
• #Decentralization
• #DApps
• #Tokens
• #DeFi
• #Bitcoin Ordinals