The Future of Bitcoin: Exploring the Synergy Between Threshold and Sui Foundation

Get ready — Web3 is entering a new era where Bitcoin isn't just stored, it’s productive. In this episode of The Edge of Show, host Richard Carthon sits down with two visionaries reshaping crypto finance: MacLane Wilkison, co-founder and CEO of Threshold Labs, and Jameel Khalfan, Head of Ecosystem Development at the Sui Foundation. Together they explore the seismic shift of Bitcoin into DeFi — with a spotlight on Bitcoin DeFi on Sui, powered by tBTC. If you’re immersed in Web3, crypto, or NFTs and wondering where Bitcoin fits into this next chapter, this conversation unpacks how bridging, vaults, chains and community are aligning to put Bitcoin to work. Strap in for insights, strategy and real-world signals that Bitcoin’s breakout moment in DeFi is arriving.

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Key Topics Covered

• How tBTC (via Threshold Labs) unlocks Bitcoin DeFi on Sui, bringing native BTC into a high-throughput, composable ecosystem.
• Phase 2 of tBTC on Sui: seamless bridging from Ethereum → Sui, auto-looping vaults, new yield strategies and structured products.
• Why Sui is accelerating Bitcoin liquidity — fast finality, low fees, object model, and strong builder appetite.
• What data and on-chain signals reveal that Bitcoin liquidity is scaling in DeFi: TVL growth, pool deposits, borrowing activity.
• Security, decentralisation and trust-minimisation in Bitcoin bridges: how Threshold approaches custody, signers and the honest-majority assumption.
• The developer & community angle — how builders are pivoting to Bitcoin-first DeFi products on Sui, and how quests, campaigns and ecosystem support are driving adoption.
• Looking ahead: the vision for Bitcoin not just as digital gold but as active capital; multiple chains, institutional flows, composability and real global utility for Bitcoin in DeFi.

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Episode Highlights

“Bitcoin over the last year… people start to deploy their Bitcoin into ecosystems like Sui and others. And a large part of that is just this resurgence of interest around how we can do more than just hold our Bitcoin.” — MacLane Wilkison
“The user experience is so much better and smoother [on Sui]. It just opens up a lot more doors for builders to come in and do really interesting things with it.” — Jameel Khalfan
“Phase 1 proved there is strong and growing demand for trust-minimized Bitcoin onchain, and Sui has emerged as a natural home for it.” — MacLane Wilkison
“We want to make sure that everyone has choice in terms of what they want to do… you can come in one way that you feel comfortable and then discover everything else that’s available in the ecosystem.” — Jameel Khalfan
“We are giving people the rails to deploy their Bitcoin where they want to deploy it. Wherever there’s a thriving DeFi ecosystem with appetite for Bitcoin, we want TBDC (tBTC) to be the rails that gives people access to that.” — MacLane Wilkison

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People and Resources Mentioned

• MacLane Wilkison — Co-Founder & CEO of Threshold Labs
• Jameel Khalfan — Head of Ecosystem Development, Sui Foundation
• Richard Carthon — Host, The Edge of Show
• Threshold Labs
• Sui Foundation ‍
• tBTC / Threshold Network — trust-minimised Bitcoin bridge
• Wormhole Bridge — cross-chain infrastructure referenced

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About Our Guests

MacLane Wilkison
MacLane is the Co-Founder and CEO of Threshold Labs (the operational arm of the Threshold Network). With a background in investment banking at Morgan Stanley and early blockchain involvement, he drives the vision of making Bitcoin programmable, composable and accessible across chains. His work at Threshold has helped expand tBTC across multiple chains and enabled major integrations in the Bitcoin DeFi sector.

Jameel Khalfan
Jameel serves as Head of Ecosystem Development at the Sui Foundation. With a decade of experience in mobile gaming, business development and partnerships (including roles at Google Play and Pocket Gems), he now focuses on scaling Sui’s DeFi and gaming ecosystem. He plays a pivotal role in onboarding Bitcoin liquidity into Sui, and building out partnerships and infrastructure for the next-gen Web3 stack.

Guest Contact Links

MacLane Wilkison
LinkedIn: https://www.linkedin.com/in/maclane-wilkison-activity-7166969072172064768-NvHr LinkedIn
Twitter: https://x.com/MacLaneWilkison X (formerly Twitter)
Website: https://threshold.network/ threshold.network

Jameel Khalfan
LinkedIn: https://www.linkedin.com/in/jameelkhalfan LinkedIn+1
Twitter: https://x.com/jameellionaire iHeart
Website: https://sui.io/

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Transcript:

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MacLane Wilkison: Hey, I'm McLean Wilkerson, co-founder of Threshold Network and CEO of Threshold Labs. I'm Jamil Kalfan, head of ecosystem development at SWE Foundation. At Threshold, we're unlocking Bitcoin's true potential with TBDC, a decentralized Bitcoin bridge that makes Bitcoin programmable and composable across chains.

Jameel Khalfan: At SWE, we're creating a home for Bitcoin liquidity with breakthrough speed, scalability, and user-friendly experiences. With Phase 2 of TBTC on SWE, we're empowering builders, communities, and users to transform Bitcoin from digital gold into a dynamic financial asset.

MacLane Wilkison: You're listening to The Edge of Show, where we explore the boldest ideas shaping Web3.

richard carthon: Don't go anywhere. Hey Wipthy Pioneers, today we're diving in with McLean, who's the co-founder and CEO of Threshold Labs, and Jamil, who's the head of ecosystem development at Sui Foundation. We're going to first break down how T-BTC is powering Bitcoin's breakout moment on Sui, and Phase 2, unlocking seamless bridging and yield strategies. We then explore how Bitcoin DeFi is going faster than ever over on SWE. And then finally, we're going to look at phase two and what it means for builders communities in the future of Bitcoin Fi adoption worldwide with XTBC and SWE. All this and more on the Edge of Show, where we spotlight the boldest moves shaping Bitcoin's role in Web3. Please cue the intro.

intro/outro: Welcome to The Edge of Show, your gateway to the Web3 revolution. We explore the cutting edge of blockchain, cryptocurrency, NFTs, ordinals, DeFi, gaming and entertainment, plus how AI is reshaping our digital future. Join us as we bring you visionaries and disruptors pushing boundaries in this digital renaissance. This show is for the dreamers, disruptors, and doers that are pumped about where innovation meets culture. This is where the future begins.

richard carthon: Welcome to the Edge of show. I'm your host, Richard Carthon, and we feature a variety of top-notch guests and other hosts as well. It's another production of the Edge of Company, a quickly growing media ecosystem, empowering the pioneers of Web3 tech and culture. It's responsible for other groundbreaking endeavors like the Outer Edge Innovation Festival in LA and Riyadh. Today's sponsored show features McLane Wilkison, who is the co-founder and CEO of Threshold Labs and is a leading voice in the decentralized infrastructure, privacy, and Bitcoin utility. We also have Jamil Kalfan, who is the Head of Ecosystem Development at Sui Foundation, whose work is shaping the future of blockchain usability and adaption through next-gen partnerships and product innovation. Jamil, McClain, it's great to have you both. Thanks for having us. Absolutely. So I'm going to kick things off. I kind of want to start with having you both share what excites you personally about Bitcoin's expanding role in DeFi and why you think this moment matters to both of you. Obviously, a lot has happened this year from ETF expansion and Bitcoin new all time highs. There's a lot of exciting things happening. So, McLean, I'll let you kick off first.

MacLane Wilkison: Yeah, absolutely. I think this is a very exciting time for Bitcoin DeFi. Bitcoin over the last year or so has had a kind of a resurgence or renaissance in terms of people's interest in deploying it as an asset in DeFi. Historically, it's been sort of this digital gold that people have held on to. They haven't really leveraged it that much in terms of actually deploying it into LP positions and DeFi ecosystems or lending and borrowing against it on these new decentralized lending platforms. But I think that's really started to change. And the reason why that's exciting for me. is I think Bitcoin has kind of not had as much weight or power in the DeFi ecosystem as you would expect, given its historical dominance. I think even so, it's by far the largest, most pristine digital asset that exists, over $2 trillion of market cap. I think Bitcoin dominance is still around 60% right now. So you would expect, by extension, maybe Bitcoin would represent at least 60% of assets deployed to DeFi. And that's definitely not the case historically. I think we're starting to change very quickly as people start to deploy Bitcoin onto ecosystems like SWE and others. And a large part of that is just this resurgence of interest around how we can do more than just hold our Bitcoin, how we can earn additional yield on top of it, how we can borrow against it, how we can lend it out, how we can do all these interesting things. in conjunction with that, much easier ways to actually do that. So not having to send your Bitcoin to some centralized custodian or centralized lender as collateral, but instead being able to easily bridge it from native Bitcoin to SWE, to Ethereum, to all of the ecosystems that have thriving DeFi ecosystems. and maybe do that easily and comfortably for the average user in a way that is as trust minimized as possible so that they're not having to sort of hand over the keys to their Bitcoin to centralized companies. And I think like the bridging UX and the UX or how to do that has improved very significantly over the last year and a half or so.

richard carthon: I agree. How about yourself, Jamil?

Jameel Khalfan: Yeah, I think Bitcoin has always been their premier asset of crypto. And as McLean said, if you look at sort of the amount of Bitcoin that's available relative to how much has made its way into DeFi, how vibrant the DeFi ecosystems are, you know, things don't quite line up yet. And so we're seeing that change over the last year, year and a half. But I think there's so much more that you can do with Bitcoin, you know, once you make it into a productive asset rather than just holding it as digital gold. And so we've seen, you know, for people to access it. There's more exchanges that are out there. There's ETFs. There's other ways that, you know, different investors have access to Bitcoin. But only now recently have you seen it make its way into DeFi. And so once it's there, there's so much more that you can do with it. I'm sure we'll get into all the different exciting things that you can do as we continue the discussion during the podcast. But that's what gets me really excited here is that all of the things that you know and love about Bitcoin and then all the things that you know and love about DeFi can finally combine. There's just so much more that you can do.

richard carthon: Yeah, Jamal, I'm excited to dive into a lot of that, too. But one thing I want to ask as a quick follow up is like, you know, what was your aha moment when you realized that Bitcoin liquidity could also thrive on top of SUI?

Jameel Khalfan: Yeah, it was probably maybe a year and a half ago. I had already been, you know, sort of well-versed in the DeFi ecosystem with SWE, was, you know, trying all the different lending protocols and DEXs, and was just really impressed with how fast and smooth everything was compared to anything that I'd used before. And I think it had been a while since I had done much with Bitcoin, but I had a friend who, you know, got interested in Bitcoin. So I thought, okay, let me see, let me send them like a little bit of Bitcoin. That can always get dangerous. You don't want to end up with the million dollar pizza or anything like that. But let's see. When I first got into Bitcoin, not a whole lot has changed, which is part of the beauty of Bitcoin. But to do any transactions, it takes a really long time. And it's very difficult to do things like lending or swapping or anything else. And so, you know, seeing those things juxtaposed next to each other, you know, kind of had a light bulb moment for me where I thought, well, if you can take the bite, then there's just so much more that you can do. The user experience is so much better and smoother. And it just opens up a lot more doors for builders to come in and do really interesting things with it.

richard carthon: It definitely does. And I think that's where this like synergistic opportunity has come between TBTC and the SUI integration. So McLean, I want to move this over to you. That integration was a pretty pivotal milestone. So how does it build on the success of phase one? And you know, what are you excited about as you move into phase two?

MacLane Wilkison: Yeah, I mean, so for Threshold, basically the reason why Threshold exists is to provide the best rails and the easiest rails and the most secure and trusted rails to deploy your Bitcoin into DeFi. And Threshold is fundamentally sort of neutral in terms of like where we think people should deploy that Bitcoin. But obviously, you know, we had to be very selective and we're paying very close attention to like which ecosystems we think are the most promising in terms of Do they have interesting DeFi apps that are thriving and building out a robust DeFi ecosystem? Do they have a large base of users who want to deploy their Bitcoin into the DeFi applications? And I think we were very impressed with SWE. I think across the entire ecosystem, there was a lot of interest and support and appetite, both from users looking to deploy, as well as various protocols, whether they're DEXs or lending platforms. more or sort of more some of the more exotic things you could do on SWE specifically that really wanted to attract Bitcoin liquidity. And they were really leaning into that narrative. And so we were very, I think that everything kind of lined up very well. You know, users check, you know, ecosystem check, support from all the necessary ecosystem partners check. And so I think we were very happy with how the initial rollout goes. I think there's been pretty good promising initial uptake, both on DEXs, on Bluefin, and also on lending, and particularly some looping strategies that people have been doing on AlphaPhi. And so I think this next phase of Bitcoin season on SWE with TPTC is just leading into that. So expanding the kinds of structured products that will exist that people can deploy their Bitcoin into. There's a couple of vaults right now. I think there'll be more vaults with different strategies coming very soon on SWE. We also now have, in addition to direct Bitcoin to SWE, we also have cross-chain bridging between other ecosystems in SWE. So you can go now from Ethereum, where there's a lot of TPTC liquidity, you can bring that over directly to SWE. So just making it as seamless as possible and as easy as possible for people to move that liquidity over and to deploy their Bitcoin into these interesting applications on Sui.

richard carthon: I imagine that's something that your users have been really excited about. One of the challenges that typically comes up in the DeFi world is access to liquidity and being able to do that. So Sui has done a really good job of like helping to bridge that. So Jamil, you know, Bitcoin adoption in DeFi historically lagged. Sui is becoming a natural home for Bitcoin Fi. Why do you think and what are the factors that are helping to explain the momentum that you're seeing with more liquidity coming on over to Sui?

Jameel Khalfan: I think the traction that we've seen has exceeded our expectations. I think impressed a lot of us. We had this idea that the DeFi ecosystem here would be perfect for Bitcoin because of the smooth user experience, the low gas fees. There's just so much more that you can do with the object model. But the Bitcoin has come over pretty quickly. I think at this point, Bitcoin makes up over 20% of SWE's TVL and it's growing very, very quickly. We started to see more and more you or DeFi protocols and support the various Bitcoin initiatives that we have. And now we're starting to see some of the more advanced strategies, as McLean said, with vaults and structured products and auto looping strategies that give users a bunch of choice in terms of what they want to do with the Bitcoin once it comes over here. So you now have more options on what you can do, and you can take advantage of everything that's been built before. And so I think that's the beauty of the DeFi ecosystem here is that, you know, there are already prominent lending protocols and DEXs that have now stepped up to add Bitcoin-specific products there. So they already have a liquidity and they already have a bunch of users and now they're offering more products and services both for their existing users as well as others that are coming in and discovering this for the first time via partners like Threshold. So I think it's just a great user experience that's made it very easy for people to come in and onboard. And then there's just so much that you're able to do with your Bitcoin once you're here. And that's what's made it very exciting.

richard carthon: Yeah, I think that part's really cool. And I really do want to emphasize, you both kind of leaned into a little bit, and it's talking about the liquidity side. And so, you know, what are the signals or data points that's convinced you that Bitcoin liquidity is ready to scale here? And I'll kind of pass this to you first, McLean, because I think you mentioned Alphaland, and I think there's like $10 million that got supplied over there. So like, how is that helping to signal for you? Hey listeners, are you ready to amplify your voice in a digital world? Introducing .podcastdomains, your gateway to the future of online identity. Whether you're a creator, a company, or just someone with big ideas, .podcast is for you. Own your unique digital identity, connect securely, and explore hundreds of apps with no renewal fees. Don't wait for someone else to claim your name. Secure your .podcastdomain today and be part of the next generation of content creation. Visit get.unstoppabledomains.com backslash podcast to get started. Again, that's get.unstoppabledomains.com backslash podcast, your voice, your rules, your identity.

MacLane Wilkison: Yeah, I mean, I think, well, I guess there's the broadly, like I think Jamil mentioned, Bitcoin percentage of SWE, DeFi, TVL is 20%. I don't know actually what it was, you know, a few months ago. But obviously, that's certainly headed in the right direction. I think it'd be great if we can get Bitcoin dominance in DeFi up to the 60% Bitcoin dominance in terms of market cap as well. But yeah, I think what we've seen in terms of like the initial sort of indications of what people want to do with TPTC on SWE is certainly like, you know, the auto looping on AlphaFi and AlphaLend is a very popular strategy. We've seen a lot of people deposit into Bluefin. So there's several different pools on Bluefin, a couple of stable pairs, I believe with LBTC and XBTC and a volatile pair. against USDC, which obviously requires a little bit more active management than the stable pairs do. But that's, I think, the initial sort of appetite that we've seen is people looking to add additional yield on top of their Bitcoin and just to earn what they can on top of that, as opposed to just letting it sit idle. And that's what we're going to lean into a lot with this phase two, is just additional structured products, additional vaults, additional ways for people to just easily earn yield if they implement different strategies and sort of take care of some of the complexity behind how that yield is achieved under the hood. So it's not something that an end user isn't necessarily having to have to manage all these positions themselves. For example, like setting ranges on a DEX, but that's all handled for them by the vault curator and the strategist. So I think that is going to be what we'll see a lot with phase two, is just a lot of these very easy sort of one-click, single-click deploy your Bitcoin into SWE and then yield on it without having to sort of get in the weeds in terms of actually sort of doing all these transactions yourself.

richard carthon: Yeah, the user simplicity helps a lot, having a good UI. We just talked about liquidity side, but Jamil, to pass it back to you, the same question, where are some of the qualitative things that have stood out that you think show that now is the moment for this?

Jameel Khalfan: I think it's a couple things. One is on the UI-UX. I went and tried a bunch of these things as they got released and it feels very much like you're using a Web2 product or just going on to a centralized exchange. clicking a few buttons and you're able to deposit it. It doesn't feel so much like DeFi and Web3. And I think that user experience extends not just from what we built for SWE, but also to all the different DeFi protocols of making sure that it's very seamless for users. I think that's one thing. And I think the second thing, given that there's options for users in terms of what they want to do, we've seen kind of a big push from the broader community on making you know, how-to guides on, okay, this new feature is out. Here's how it works. Here's how you do it. Here's how you access it. And so that makes it feel a lot easier, a lot more welcoming for someone wanting to come in for the first time. Maybe they haven't done any of this before. They're not sure exactly what to do. It's nice that there's a large community out there that's willing to sort of help and guide and give pointers on, you know, where can you get the best yield? What are the trade-offs between the different strategies that you want to do? How can you just get started and just do basic lending? And so that's been really nice to see that the community has also stepped up and come and helped each other out.

richard carthon: It helps tremendously. Just being able to have a place you can go and get some of that insight, and also help each other, try to get the best numbers and find other ways that they can utilize utilizing this very synergistic integration between both the SWE and Threshold. So I kind of want to go in another direction. One of the things that Threshold uses is like the wormhole powered seamless bridging. So big headline for some people listening, they might not understand like what that means. So like, how does this bridging work? Why does it matter so much in this context? And how is it helping to expand Bitcoin across ecosystems? And McLean, I'll let you go first.

MacLane Wilkison: Yeah, so when we launched initially on SWE with phase one, that was basically direct native Bitcoin to SWE. So you could mint TBTC on SWE by depositing your native Bitcoin into Threshold Network. With this phase two, if you go to SWE.threshold.network, you can now do easy cross-chain bridging from the other major DeFi ecosystem, which is Ethereum. With TBDC, this is the majority, I don't know the percentage on my head, but the majority of TBDC, TVL currently lives on Ethereum, given it's a very, you know, established and mature DeFi ecosystem. And so we think that there's going to be a large contingent of people who are TBDC users. currently on Ethereum, who now with an easy way to bridge from ETH to SWE, will start to move some of that TPTC over and take advantage of some of these sort of unique and novel opportunities within the SWE ecosystem. So we're excited to see sort of what kind of uptake we get with TPTC, in addition to being able to mint natively from Bitcoin, but now to be able to move your TPDC from existing ecosystems over to Suite. And of course, both directions. So I think that will be a pretty major unlock for additional flow into Suite. And we're excited to see how people deploy that, whether they deploy that directly into some of these ecosystems themselves, or ideally take advantage of some of these new vaults and structured products that we're going to be launching here shortly.

richard carthon: Definitely. And Jamil, as a quick follow up question to that, you know, one of the main important context of that is the ability for interoperability. So how do you think that it's key to mainstream Bitcoin adoption and how is SWE stepping up to help with this?

Jameel Khalfan: Yeah, as McLean said, I think that the wormhole integration is a big unlock. I think initially you'll probably see a lot of the liquidity flow from Ethereum over to SWE. I think that's going to be natural since there's more TBTC over there to start. But we also want to make sure that all of this does end up being interoperable. And that's why you know, we're working closely with Wormhole to make sure that assets can flow in either direction. And so I think that that just makes it easier for users to feel comfortable coming in. They can try different things. If they decide they want to deploy liquidity back to Ethereum or somewhere else, it'll be very easy for them to move around. And I think that gives people more comfort that, you know, they're more willing to go and try something new and see if they like it, knowing that, you know, it's a two-way door.

richard carthon: That's awesome. And I think as you continue to both focus on simplicity and usability and just a very easy product line for people to come in, both of you, both Threshold and Sui have different initiatives in line. So, for example, Threshold's protocol design and Sui's foundation ecosystem growth, both organizations are working together in a very seamless way to attract builders and strengthen community engagements. So, you know, are you starting to see more builders design Bitcoin-first DeFi products or are they building things more native? But because things are interoperable, they're building things natively on different protocols. Like, what are you kind of seeing here? And McLean, I'll pass it to you first.

MacLane Wilkison: Yes, I mean, I think what we've seen at Threshold is over the last few months, our TVL has grown pretty significantly as people start to look for ways to deploy their Bitcoin into SWE and into other DeFi ecosystems. So I think it's up around 30-ish percent over the last several months. So we're seeing quite nice growth and uptake there. Obviously, we want to accelerate that as much as possible by leading into this easy UX so people can easily move from Bitcoin or from Ethereum to SWE or whatever ecosystem that they want to deploy into. So just continuing to polish that UX and making it really seamless and easy for people to understand. And then also, once they're in their target ecosystem, easy for them to just deploy into a voluntary structured product to actually get the end goal of what they likely want, which is to earn yield. I think what we've seen, I think, as part of that success on SWE and other places, we've seen definitely a lot of demand within the existing ecosystems like SWE from other projects and protocols and other DeFi platforms that want to onboard BTC as collateral via tBTC, and then also from other either existing ecosystems, existing L2s, other chains, or upcoming ecosystems that want to also onboard Bitcoin liquidity. So I think what you'll see over the next several months is definitely like leaning into our existing ecosystems and partnerships with partners like SWE and growing the TVL there very aggressively, but also expanding TBDC to other either existing ecosystems that don't have a ton of Bitcoin liquidity yet or new ecosystems that want to have Bitcoin liquidity from day one. And fundamentally, like the reason for TBDC is we want to give people the rails to deploy their Bitcoin where they want to deploy it. And that means wherever there's a thriving DeFi ecosystem with appetite for Bitcoin, we want TBDC to be the rails that gives people access to that.

richard carthon: That's awesome. Jamil, I'll kind of ask you the same question with a follow on, which is, you know, are you also seeing more builders building Bitcoin first DeFi products over on Suite? And then also, what do you think the roles of like campaigns and quest play in adoption versus traditional initiatives that we've seen on DeFi products before?

Jameel Khalfan: The one thing that I think is really interesting in, you know, this job specifically versus, you know, a lot of the other things that I've done in the past is that, you know, we as a foundation, we don't run any DeFi protocols ourselves. You know, we don't operate any of this. And so, you know, what we can do is bring everyone together. And so what we've tried to do over the last year is we've thrown up the bat signal. We've said BTC-Fi is something that is very important to us. It's something that we want to support. We're making investments in companies that are building up these types of products. And we've seen an incredible demand both for DeFi protocols on SWE, as well as some others from other ecosystems. You know, those that work with TBTC and others, you know, on Ethereum or in other ecosystems have now approached us and said, hey, we want to come to SWE because we're doing BTC-Fi elsewhere. And we think that this is going to be a really exciting way for us to expand and offer new products and services to our users. And so that's been pretty incredible to see. We ran an accelerator program last year called Hydropower. And some of the feedback we got from the companies is that they were kind of looking at what moves we're making, what direction we're trying to go in. And we've had a couple of the companies there decide to pivot and now focusing on trying to build Bitcoin vaults, as an example. So we've seen existing projects focus their time and effort on Bitcoin. We see new projects that are building and still trying to find that product market fit, decide to pivot to Bitcoin. And we've also seen projects from other ecosystems approach us. And so you'll see over the coming months, more established DeFi protocols from Ethereum and elsewhere starting to add support for SWE specifically for BTC-Fi. And so that's been really exciting for us to see all of those things happen. And especially with our role as a foundation, we can tell people, this is what we'd like to see. Here's some connections that we can make, introductions that we can make. We'll host events and get people together. But ultimately, it's going to be up to the different companies and the different protocols to collaborate in order to make this happen. And so, you know, we've seen Threshold collaborate with Bluefin and AlphaPhi and others on doing this. And that's been really nice to see that, you know, all of this collaboration can happen, you know, amongst the different protocols. And then to answer your other question around, you know, quests and all of that, you know, I think that, you know, there's certainly some exciting opportunities to earn, you know, boosted yield within the ecosystem. And so that's been something that I think, you know, we've had some protocols really think hard about, you know, what activities they want users to do. Do they want people to deposit and lend? Do they want people to borrow? Do they want people to try the new vaults out? And so what you're going to be seeing here is that, you know, a lot of these different protocols are going to be offering, you know, different types of promotions to incentivize different types of user behavior. And that's the way to get everything bootstrapped, get the Bitcoin liquidity over, get people comfortable with the different things that you can do with it. And then hopefully that starts this flywheel effect. And then you'll get more and more people coming over and trying things out and hopefully staying here, you know, keeping the Bitcoin in the ecosystem and finding more ways for it to be productive.

richard carthon: Yeah, just to speak to that for a second. It's really awesome to be able to have all these different incentives to bring in new users, but to also keep them there for a while. And in that squeeze leaning into that, McLean, before moving forward, want to give you an opportunity. Are there things that Threshold's doing right now, whether it's quests or campaigns that you guys have going on that have helped with bringing in some of these new users?

MacLane Wilkison: Yeah, so I think for phase two, we'll definitely be doing some more requests and campaigns just to activate both new and existing users in the suite ecosystem. I think the way that we think about it is we want to bring Bitcoin users to SWE, we want to bring TBDC users from other ecosystems to SWE and vice versa. And then we also want to activate for new TBDC users on SWE that, you know, maybe our existing SWE users use the existing DeFi ecosystem there, but don't already have Bitcoin exposure. And we think, you know, Bitcoin is the best digital asset, the premier digital asset, and more people should have access to it and should own it, particularly if they're active, you know, in crypto. And so I think we'll be targeting basically a variety of those different types of users and target users in phase two as part of the quests and different activation campaigns.

richard carthon: That's awesome. Really exciting. Jamil, I want to go back to you for a moment, because, you know, as we know, in the previous DeFi summers, a lot of DeFi had been built on top of Ethereum and a lot of liquidity has been over there. However, I think the next big phase of DeFi is coming over into Bitcoin. So how do you see SWE carving its own lane in that? And how do you think Bitcoin FI is going to be defining pillar for SWE into the future?

Jameel Khalfan: Yeah, I'm really excited about this piece, just, you know, even as just a user of these different protocols, you know, I don't want to say anything bad about Ethereum, you know, because they certainly paved the way for us to be able to get here. But, you know, the user experience is going to be, you know, night and day, you know, doing something in the DeFi ecosystem there versus on Sui. And so I do see, I see that being a big driving factor in terms of why people are... are deciding to try SWE and once they come, why they decide to. And so we're starting to see more and more Bitcoin flowing into SWE. We're starting to see more and more stable coins flowing into SWE and other assets as well. And so once you have everything here, that's when the magic starts to sort of happen. That's when you can do things like deposit your Bitcoin, you can borrow stables against it at low rates. You can do a whole bunch of looping strategies and other things as well. And so the more assets that come over to SWE, the more liquidity that comes, the more users that come, because of that fast user experience, I think it all is going to end up building upon itself. And so once more people discover how seamless it is to use SWE and to use the DeFi protocols, the one-click swaps, one-click deposits, having your transactions finalized instantly, It's going to be great as more people come and discover this. And so, yeah, my hope is that we get the same level of excitement for BTC-Fi and generally for DeFi on SWE that we saw in previous DeFi summers. But I think it just makes total sense with all the traction that Bitcoin is getting and how easy it is to use DeFi on SWE to combine those two things together. It's going to be great.

richard carthon: I think there's a lot of excitement to be looking at, and I think there's been a lot of interest in Bitcoin owners being able to finally be able to participate in these fun things like decentralized finance. But one of the things that is very true to a lot of Bitcoin holders and is generally for people that are looking in the space is security. And I want to spend a little bit of time on that. So with any cross-chain yield product with risk that comes with it, McClay, I'm gonna point this to you first. How are you ensuring that TPTC on SWE remains secure, decentralized, and users can trust as the adoption continues to scale up the product?

MacLane Wilkison: Yeah, I mean, security is by far the most important thing for Threshold. Like, we are giving people a way to move their Bitcoin, which is probably almost certainly their most important digital asset, and to deploy that. And obviously, if there's not a way for them to do that safely and securely, like, what's the point? So we think very hard and spend a lot of time about how can we minimize the risk surface and minimize the amount of trust that users have to basically give to us or give to the network in order to access these rails and to deploy their Bitcoin into different DeFi ecosystems. So right now, threshold relies on what's called an honest majority assumption. So basically, we split the custody of the Bitcoin across, currently it's over 20 different independent signers, most of which are very like They're custodians or professional staking companies that all together basically custody this Bitcoin. So no single one of those entities can move the Bitcoin themselves. They basically have to come to consensus that, hey, this is like a valid mint request or a valid redemption request. Otherwise, you know, that Bitcoin stays where it is, it stays safe, it stays secure and it stays protected. I think in the future, I think there's a lot of interesting stuff happening in the Bitcoin design space around improving like the, what's possible in terms of the trust assumptions and the custody assumptions. There's been this sort of new set of basically new design space broadly referred to as BitVM, which could allow bridges to improve from a honest majority assumption to a one of N trust assumption. So as long as one of the signers on a custody wallet is honest and rational. There's no way for the signers to collude and try to steal the Bitcoin. So I think ultimately, that's probably where we'd like to move towards. That said, BitVM is very much a moving target, and it's kind of unclear what the best possible design on that side of things will end up being. It's also very new. So TPTC has been live in production with a significant amount of TVL, a significant amount of bridge volume for almost five years now. The code base is very Lindy. I think it's like, like, in my opinion, like, by far, like the most trust minimized proven battle tested Lindy decentralized Bitcoin bridge in the market. So we're not going to sort of rush into, you know, embracing like, a very sort of novel piece of technology until it's mature and sufficiently proven for us to feel comfortable migrating some of our custody vaults to that. But ultimately, I think that's where the direction we'll take. But really, like we are very focused on when just basically keeping making sure TBTC is the most trust minimized and secure way to deploy your Bitcoin and Rails to access different DeFi ecosystems, both now and in the future.

richard carthon: Definitely. The security piece is very essential. And, you know, making sure that things are staying secure. I'm sure Jamil is important to SWE as well. So how are you continuing to look at security partnerships as you work with Threshold and even within SWE itself?

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Jameel Khalfan: Yeah, there's a lot that we're doing and I think it starts from the foundation. So SWE's built from the ground up. It uses a move programming language, which is designed to be more secure and eliminate a lot of the sort of security pitfalls that developers might run into previously with other blockchain languages. We start from, I think, a very good place. But of course, on top of that, there's more things that you need to do. And so we built partnerships with various auditing companies and companies that do formal verification. And so we're putting together a consortium of companies that can help across auditing, bond bounties, and everything else. So you'll see a lot of these protocols will go through multiple audits. Some of them will go through formal verification very early on. a lot of the code ends up being peer-reviewed, and there's bump bounties and other things. So there's a lot that we're doing to maintain the security of the ecosystem and of all the protocols that are participating. I'd say the other thing is in terms of the trust for the users. There's some users that might want to trust something that's completely decentralized and permissionless. There's others that might prefer you know, an option that's like totally the opposite. And so, you know, for us, you know, we want to make sure that everyone has choice in terms of what they want to do. And so, as McLean alluded to earlier, we also have XPTC from OKEx, which is a wrapped product from an exchange, and there's pools, liquidity pools that you can you know, participate in between the two. So we want to make sure that we offer, you know, different types of choices for users that have, you know, different types of trust assumptions and be able to come in in one way that they feel comfortable and then discover everything else that's available in the ecosystem. And so that's kind of the approach that we're taking here. It starts from the ground up with the way that the blockchain was built and then extends to all the different programs and partners that we have, you know, on top of it to maintain security of the chain.

richard carthon: I think it's great that you're trying to meet your end user where they are depending on the risk tolerance and also like how they view wanting to deal with something more decentralized versus something that's a little bit more centralized, etc. And continue to make this a priority for both. Uh, sweet and for threshold. Um, but now I kind of, as we, as we wrap up here, uh, I want to kind of like eye in the sky, look out into the future and we're looking out, you know, two to three years from now. Um, what do you think, and what is your vision for where Bitcoin fi is going to be? And do you think we're going to get at an inflection point where Bitcoin truly becomes digital gold? Um, and it's really used as a global financial asset. And I'll give this to McLean first.

MacLane Wilkison: Yeah, I mean, I think like in many ways, Bitcoin already is digital. I mean, I think that's sort of it's it's proven its product market fit on that front. It's in my opinion, it's not only digital gold, it's just a strictly superior version of gold that, you know, you can carry in your pocket. You can send halfway across the world more or less instantly. You can't do that with gold. It's heavy. It's it attracts a lot of attention. I think where we're going to be a couple of years from now with BitcoinFi is I would like to see BitcoinFi TVL in DeFi be equal or greater than Bitcoin's dominance in terms of market cap. So I think that's like roughly 55, 60 percent right now. And I think the most likely landscape for the way that works is there'll just be an explosion of ecosystems that have thriving Bitcoin 5 ecosystems. I think SWE will be one. I think ETH will be one. I think there's a lot of other interesting new chains, a lot of interesting new L2s, even Bitcoin L2s. I think that's a very nascent but emergent space. And TPDC exists basically to be the rails between all of them and as well between those different ecosystems and between native Bitcoin. So wherever people want to deploy their Bitcoin, we'll give them the easiest way to do that. And I think that's the way it's going to look. I mean, I think there'll be multiple successful ecosystems with very significant TVL and DeFi activity. I don't think it's going to be, you know, all the Bitcoin ends up on one chain necessarily. But I think there's going to be a variety of different use cases and different, you know, risk appetites and basically like a spectrum that people can choose from what they're looking for in terms of yield, what they're looking for in terms of being able to borrow. And different ecosystems will be able to cater better or worse towards different use cases and towards different target users. I think increasingly we're going to see a lot of the TVL and a lot of the activity be institution driven. So I think there's gonna see a lot of larger depositors start to move into the space pretty aggressively. I think we already see a lot of institutions holding Bitcoin, native Bitcoin on their balance sheets. I think they're gonna start looking to deploy that in order to earn additional yield on top of that and differentiate themselves from competitors. So I think it's gonna become a very competitive and very robust space over the next couple of years.

richard carthon: I like it, a lot of good takes in there. Jamil, how about yourself?

Jameel Khalfan: Yeah, I think that I agree. I think Bitcoin has already proven itself to be digital gold, but it's still very early. And so, you know, what can you do when you have a bunch of gold? You know, it's difficult to transfer it to someone else. There's not a whole lot that you can do financially. So people have built a bunch of products on top of it. There's Gold ETS. There's a whole bunch of other products that you can buy that are backed by gold or derivatives of gold. And I think the advantage with Bitcoin is that You can do all of those things and we're starting to see ETFs and other traditional products that you see for gold are now coming to Bitcoin. But because Bitcoin is already digital and already permissionless, there's going to be a lot more that you can do with it. So I agree with McLean. I think you're going to start to see those folks that hold a lot of Bitcoin institutions and miners and others will want to do more with it. They're going to want to put it to work. And it's going to be much easier to do that than it would have been with gold because you'll be able to do a lot of this stuff digitally. You'll be able to issue bonds in the future. You'll be able to borrow against it. You can do this all with one or two clicks. And so you're going to start to see more Bitcoin put to work and injected into the DeFi ecosystem, you know, across all the different DeFi ecosystems. And so I think that's one thing that you're going to start to see, you know, probably next year and certainly into the future is that rather than having all this Bitcoin just sitting idle, you're going to start to see it become more productive.

richard carthon: I agree with that take. I personally think, I kind of describe it to others is, you know, the majority of Bitcoin sitting out there is idle, isn't really being used. Let's say that we get somewhere between five to 10% of that idle money starting to get put to work. And even with just that, how quickly that can multiply into more and more. And then as people get more trust in that and see how that works, that number could start to increase even more. So I think, McLean, pulling in from a little bit of what you said, and Jamil, a little bit of what you said, I do think we meet in a lot of those takes and have a lot of alignment of where these things are headed. So I really want to thank both of you for a really awesome conversation, learning more about what you both have going on. But we like to wrap with a segment called shout outs. And in this, we give you both a moment to shout out whoever you want, whether that's someone on your team, whether that is a significant other, whomever, on, you know, just as you're working through all this stuff that don't necessarily always get their flowers, this is an opportunity for you to do that for them. So, McLean, I'll pass it to you first. Who would you like to shout out?

MacLane Wilkison: Yeah, I mean, I'll start with some of our partners on SWE. I think certainly the SWE Foundation, but also Bluefin and Alphafly and Alphaland, I think have been great initial sort of partners to help us enter the SWE ecosystem. I think we're very excited to continue to work with them, both on their existing platforms that they have for TPTC, but also future potential vaults or structured products. and help us sort of get even more deeply embedded in the SWE ecosystem. And then also a shout out to the Threshold Labs team who's worked very hard on improving the UX and the rails between SWE and Bitcoin and everywhere else where TBDC exists. And so shout out to them for the hard work of making everything work smoothly and seamlessly and securely. Awesome.

Jameel Khalfan: How about you, Jamil? Yeah, I'd probably echo a lot of the same folks. My job is to come here and talk about how great everything is, but if you look at who's doing all the work behind this and building the protocols and making sure everything is secure and getting launched, obviously the team at Threshold, but then the folks at Bluefin, AlphaPhi, AlphaLend, have done just a tremendous job of getting all this shipped with an amazing UI. and getting it out the door in a way that the users I think will love. And so definitely want to give a shout out to them. And then to all of the users that are going to come in and try this thing. So, you know, thank you for coming in early and please continue to give us feedback.

richard carthon: Awesome. Well, definitely appreciate both your shout outs. Jamil, for people who want to learn more about what's happening at SWE, where can they go?

Jameel Khalfan: So for people that want to learn more about BTC-PHY and SWE, you can go to swe.io slash BTC-PHY. So sui.io slash BTC-PHY. And we have a list of all the different ways to get started, to test out, and you can give TBTC a try.

richard carthon: Awesome. And McLean, for people that want to learn more about Threshold?

MacLane Wilkison: This is the main place would just be Threshold.network. You can also go directly to the TBDC minting dashboard, which is dashboard.threshold.network. And you can bridge your native Bitcoin over to SWE and other supported ecosystems. We also now have SWE.threshold.network, where you can move if you have TBDC on another ecosystem like ETH, you can move that over or back and forth between that ecosystem and SWE.

richard carthon: Awesome. Well, McLean, Jamil, really appreciate your time today. And for everyone listening, be sure you tap into our next episode. Thanks.

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