Programmable Bitcoin Is Here: Build DeFi Apps Directly on BTC

Programmable Bitcoin, known for its unparalleled security and adoption, is stepping into the future of decentralized finance (DeFi) with the Runes Exchange Environment (REE). This groundbreaking technology introduces a Turing-complete execution layer for Bitcoin, enabling developers to build DeFi applications directly on Bitcoin without the need for bridges, forks, or new opcodes.

The Evolution of DeFi on Bitcoin

Bitcoin’s architecture, while secure, has traditionally been limited in programmability. Its UTXO (Unspent Transaction Output) model ensures resilience but restricts complex, stateful applications essential for DeFi. Platforms like Ethereum and Solana, with their Turing-complete smart contracts, have dominated the DeFi space—until now.

The Runes Exchange Environment (REE) changes the game by offering a decentralized execution layer for Bitcoin. It enables protocols similar to Ethereum’s EVM or Solana’s DeFi concepts to operate directly on Bitcoin’s blockchain.

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What is REE?

REE is a bridgeless execution layer designed for Bitcoin. It allows builders to create DeFi protocols that interact directly with Bitcoin’s UTXO model through Partially Signed Bitcoin Transactions (PSBT), a system that ensures:

• Security: No cross-chain risks.
• Native Integration: Full compatibility with Bitcoin Layer 1.

How It Works:

1. No Layer 2 Dependency: Unlike traditional approaches, REE operates directly with Bitcoin without introducing new layers.
2. Decentralized Multisig Coordination (DMC): This enables collaborative signing of transactions by multiple parties, making it possible to execute complex DeFi operations securely.
3. PSBT Mechanism: PSBT simplifies multi-signature workflows, ensuring seamless interactions between wallets and protocols.

Key Features of REE

1. The Exchange-Pool Model

REE adapts Bitcoin’s UTXO model for DeFi by standardizing transactions as exchanges of coin pools. This model ensures:

• Compatibility with Bitcoin’s existing structure.
• Easy implementation of protocols like lending, staking, and stablecoins.

2. Runes: Bitcoin’s Custom Tokens

Runes are programmable tokens issued directly on Bitcoin. They can represent:

• Stablecoins: For DeFi transactions.
• Governance Tokens: For protocol management.
• NFTs: Through unique metadata attached to UTXOs.

3. RichSwap: The First BTCFi Protocol

RichSwap, an Automated Market Maker (AMM) DEX, will showcase REE’s capabilities. As an open-source project, it provides a foundation for future BTCFi protocols.

Why Choose REE?

Security and Trust

REE eliminates the need for bridges or external custody, leveraging Bitcoin’s unmatched liquidity and security.

Programmability

REE allows developers to replicate complex DeFi systems using Bitcoin’s native UTXO model. It supports features like:

• Atomic Transactions: All or nothing execution.
• Composability: Seamless integration across protocols.

Cost and Performance

REE optimizes transaction costs using Taproot (BIP 341) and enhances Bitcoin’s throughput by batching transactions. Builders can also minimize operational expenses by utilizing ICP’s scalable infrastructure.

Join the BTCFi Revolution

REE is set to launch in Q1 2025, alongside its flagship protocol, RichSwap. Developers interested in building the next generation of Bitcoin-based DeFi solutions are encouraged to explore the REE whitepaper and collaborate with the Omnity Network team.

Bitcoin is no longer just a store of value. With REE, it’s evolving into a programmable, multi-asset blockchain—ushering in a new era of trustless, permissionless decentralized finance.