Bitcoin's story used to be simple: you buy it, you hold it, you wait. It is digital gold on the sidelines. But that is now changing. New infrastructure is letting Bitcoin holders put their assets to work as collateral and staking assets — without wrapping, bridging, or giving up custody. Nowhere is that appetite growing faster than in the Middle East. Joining me to discuss this is Tristan Dickinson, Chief Marketing Officer at Babylon Labs. Tristan, welcome to Capital Markets.
Thank you, Johnny. Very happy to be here.
Bitcoin has always been something you hold, not something you use. Walk us through how Babylon Labs is changing that.
Babylon is building infrastructure that allows Bitcoin to be used — built with the properties that Bitcoiners find most valuable: sovereignty, verifiability, and trust in code rather than intermediaries. We launched a staking protocol to prove the thesis that if you build infrastructure for Bitcoiners with those properties, Bitcoin will come. At its peak, that protocol held 60,000 Bitcoin with a TVL of approximately $7.2 billion. We have now extended those same properties to another protocol called Bitcoin Bolts, which has a much larger variety of use cases — using Bitcoin as collateral for lending, cover protection, reinsurance, derivatives, and more. From conversations with capital allocators and Bitcoin holders, the properties that make this appealing are the same: you maintain title, it is verifiable, and there is no trust required in intermediaries. Babylon has pioneered native Bitcoin infrastructure that is trustless — and that is increasingly gaining widespread institutional adoption and awareness.
For the institutional audience — how does your infrastructure let them use Bitcoin as collateral without giving up security or self custody?
Bitcoin Bolts is chain and application agnostic with a large variety of use cases. To bring the value to life, we focused on one of the biggest use cases first: bringing Bitcoin liquidity to Ethereum. We partnered with Aave. When you post Bitcoin as collateral, it is locked on the Bitcoin network. Aave recognises that collateral and allows you to borrow supported assets on Ethereum. The collateral stays native — you never give it up. From what we hear from capital allocators, this is very interesting to them. Because it is capital efficient and trustless, they can tap into liquidity and use it as another way to earn yield. If you borrow at 3% and earn yield on stablecoin vaults at 6%, you have a 3% carry trade.
Why is the Middle East moving so fast on Bitcoin and digital asset infrastructure?
The Middle East has taken a clear step forward globally in having regulatory clarity. VARA has got this right — when regulation is done right, it breeds innovation, entrepreneurship, and institutional adoption. Because there is a clear regulatory framework, institutions understand how they can gain exposure, and then they can start to mature in the market. It is not just about gaining exposure to digital assets anymore. It is about using that infrastructure to improve or benefit traditional financial systems. When it comes to Bitcoin specifically, the next step off the back of having a clear regulatory framework and a strong innovation ecosystem is wanting to do something with that Bitcoin — to make it productive. All of this comes back to the fact that MENA took a stance on clear regulation early, and what they are seeing now are the benefits of that.
How much of that momentum comes down to regulatory clarity specifically?
A lot of it. With that clarity, institutions have a very clear understanding of what they can do with digital assets, how to price them, and how to use blockchain infrastructure to improve everyday processes. But it is not only regulation. Just because you have a framework does not necessarily mean that end users — whether retail or institutional — will actually use it. What you also see in MENA is that businesses, corporations, institutions, and retail users genuinely want to integrate digital assets. Some banks in the region already have digital assets integrated into their applications. It is a push and pull — you need a framework that is not stifling, but you also need the institutions, retail, and companies that are willing to use it. MENA has both.
Tristan, thank you so much for joining us today.
Thank you for having me, Johnny.
