RootstockLabs launched Rootstock Institutional, aiming to deploy $260 billion in institutional Bitcoin into DeFi. Over 2.6 million Bitcoin (BTC) held by institutions remains idle, but this could soon change. On Tuesday, October 14, RootstockLabs, a key contributor to Rootstock, the…RootstockLabs launched Rootstock Institutional, aiming to deploy $260 billion in institutional Bitcoin into DeFi. Over 2.6 million Bitcoin (BTC) held by institutions remains idle, but this could soon change. On Tuesday, October 14, RootstockLabs, a key contributor to Rootstock, the…

Rootstock plans unlock $260b in idle institutional Bitcoin

2025/10/15 03:35
2 min read

RootstockLabs launched Rootstock Institutional, aiming to deploy $260 billion in institutional Bitcoin into DeFi.

Summary
  • RootstockLabs launched Rootstock Institutional to explore institutional Bitcoin uses
  • Major institutions currently own $260B in BTC that remains idle
  • Institutions could deploy this idle BTC in DeFi, earning yield for investors

Over 2.6 million Bitcoin (BTC) held by institutions remains idle, but this could soon change. On Tuesday, October 14, RootstockLabs, a key contributor to Rootstock, the first Bitcoin layer-2, announced the launch of Rootstock Institutional.

The new team will focus on ways that institutions can tap into BTC’s DeFi potential. Namely, institutions could use Rootstock, a DeFi layer for Bitcoin, to obtain yield on their BTC. Specifically, institutions can use BTC for lending and borrowing, together with other on-chain yield strategies.

99% of institutional Bitcoin generates negative returns

According to RootstockLabs’ Institutional BTCFi Report, institutions hold 2.6 million BTC in ETFs, corporate treasuries, and mining reserves. However, 99% of this BTC generates negative returns, as firms have to pay custody fees, which range from 0.1% to 0.5% annually.

Despite this, these reserves present a significant financial opportunity for holders. By March 2025, Bitcoin-native DeFi grew 2,700% year over year to $8.6 billion in total value locked. However, this figure still amounts to just 0.79% of the BTC supply, compared to 50% for Ethereum.

Market Opportunity
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