Welcome to The Protocol, where CoinDesk draws weekly stories of the most important cryptocurrency technology development. I’m Margaux Naikerk, a reporter for CoinDesk.
In this issue:
- Big BTCFi Issue: Studies point out that 77% of Bitcoin holders have not even tried it
- Ethereum Fusaka upgrade passes the whole ski test and approaches the mainnet
- DoubleZero Mainnet is now running at a 22% stake in SOL
- Bee Maps raises $32 million to expand its Solana-powered distributed mapping network
Network News
Bitcoin holders hesitate to explore BTC DEFI: Bitcoin Decentralized Finance (DeFi), also known as BTCFi, is touted as the next wave of innovation in the world’s largest cryptocurrency. However, research shows that Bitcoin holders themselves have little involvement. A survey conducted by the BTC mining ecosystem GoMining of over 700 people in North America and Europe shows that around 77% of Bitcoin holders have never tried the BTCFi platform. Just over 10% said they had done one or two experiments, with only 8% saying they were actively using BTCFi services for yields and loans. This study highlights the clear discrepancy between the promises of this field and actual reach. “While there’s a strong aspiration for these opportunities, the industry has built products for cryptocurrency natives rather than for everyday Bitcoin holders,” GoMinning CEO Mark Zaran said in a statement. That drive is evident in the data, with 73% of respondents interested in obtaining BTC yields through loans and staking, while 42% wanted access to liquidity without selling. But hesitancy is dominant. Over 40% of the respondents allocate less than 20% of their assets to BTCFi products, highlighting the reliability and complexity of the sector. — Jamie Crowley read more.
ETHEREUM FUSAKA upgrade begins on HOLESKY testnet: Ethereum’s next upgrade, Fusaka, is just approaching operation on the main blockchain after a successful test run on the Holesky Test Network last week. The Fusaka Hard Fork appears just a few months after Ethereum’s major Pectra upgrade and is designed to lower the fees for agencies using Ethereum. One of the changes introduced is PeerDAS. This helps reduce the costs of both Layer 2 networks and validators, with the ability to allow validators to check only a portion of the data they need, rather than a full chunk (“blob”). Test networks like Holesky act as practice grounds where developers can safely test new code before they reach the real chain. Launched in 2023, Holesky was particularly important as its validator setup closely reflects Ethereum’s mainnet. However, over the past few months, Holesky has begun to show signs of aging and reliability issues. Fusaka is the last upgrade that will be seen two weeks after Fusaka runs on the mainnet before the network shuts down. The next two testnet runs are scheduled for October 14th and 28th. Once they are completed, the Ethereum developers will confirm the start date of Fusaka’s full mainnet. — Margaux Naikerk read more.
DOUBLEZERO Mainnet is now in operation: The new project wants to provide blockchain with its own “fast lanes” over the Internet. The DoubleZero Foundation has announced that the much-anticipated mainnet beta has been released. DoubleZero is a network built to speed up the way blockchain verifiers communicate with each other. Instead of relying on the public internet, which can be slower and unpredictable, Solana validators can now connect via DoubleZero’s fiber route, allowing users to trade faster. Simply put, DoubleZero is like a blockchain driveway system. The usual internet routes are designed to be inexpensive and extensive, but not built with the momentary adjustments that thousands of blockchain nodes require. DoubleZero says its network reduces latency, making it easier for validators to process transactions and maintain synchronization, which could improve both performance and reliability for end users. This project has already been adopted early. Currently, 22% of staked SOLs are connected to the DoubleZero network. Large industry names such as Jump Crypto, Galaxy, RockawayX and Jito are contributing to fiber links and engineering resources, betting that faster internet infrastructure will be effective as blockchain applications grow in scale. — Margaux Naikerk read more.
BEE Maps raises $32 million in funding round: Bee Maps, a decentralized mapping project using Hivemapper, announced this week that it has raised $32 million in new funding to expand its global network of contributors and expand its infrastructure. The round was led by Pantera Capital, LDA Capital, Borderless Capital and Ajna Capital, making it one of the largest funding in the Decentralized Physical Infrastructure (DePin) sector this year. Bee Maps is an application on the Hivemapper network, one of the largest distributed physical infrastructure networks (DePINs) that focus on mapping data on Solana. Hivemapper allows drivers to provide data through AI-enabled dashcams, detect real-time changes on the road (such as new signs, detours, construction areas on the road, etc.) and quickly update digital maps to keep them accurate. Bee Maps leverages this infrastructure by giving the native token $HONEY to contributors who collect street-level images. The procurement highlights investors’ strong willingness to Bee Maps’ vision of real-time AI-powered maps. Over the past few months, Bee Maps has partnered with major companies such as Lyft and Volkswagen’s Robotaxis Program to bring their map data to their platforms. New capital will be used to distribute more devices, strengthen AI models to process and update map features, and increase incentives for contributors related to $HONEY. – Margaux Naikerk read more.
In other news
- KAIO, a tokenization company supported by Brevan Howard and Nomura Bank’s laser digital cryptocurrency specialist specializing in cryptocurrency, is introducing its tokenization funds into the sei network (SEI) amid growing real-world asset demand increases. Formerly known as Libre Capital, the company has issued over $200 million assets, including token versions of Brevan Howard, Hamilton Lane, Laser Digital and BlackRock Fund feeder funds, and plans to expand access to additional strategies. The token available to institutional and accredited investors allows on-chain subscriptions, redemptions and reporting. Sei networks are built for fast financial transactions and provide the underlying rails for execution. KAIO’s expansion follows ARK-backed tokenization company Securitize, introduced the $112 million Apollo Diversified Credit Fund, to sei, a tokenization feeder fund for Apollo’s private credit vehicle. The announcement highlights the growing trend in tokenized real-world assets (RWAs), where traditional investments such as bonds, credits and funds are expressed as digital tokens. — Christian Sander read more.
- Yuma, a subsidiary of Digital Currency Group (DCG), which focuses on distributed artificial intelligence (AI), has appointed veteran crypto founders Greg Shubey and Jeff Shubey as new chief operating officers and chief technology officers, respectively, the company announced. The company said the adoption marks a significant expansion for Yuma, who is preparing to launch an asset management division, including validators, mining and subnet accelerator efforts, as they expand their operations across the Bittensor network. The Schvey brothers are best known as the co-founders of TradeBlock, the institutional crypto data and portfolio management platform acquired by DCG, and Axoni, a blockchain infrastructure company that serves traditional financial markets. Axoni’s largest business unit was acquired in 2024 by the London Stock Exchange Group (LSEG). DCG was an early investor in both businesses. — Will Canney read more.
Regulation and policy
- The Bank of England (BoE) is planning to exempt stablecoin holdings proposals, Bloomberg reported earlier this week. The report said that the central bank will grant exemptions to some companies that need to hold a large number of tokens, including cryptocurrency exchanges. Officials say the UK Central Bank will also allow businesses to use stablecoins for payments in digital securities sandboxes. Last month, central bank officials were reported to plan to set a cap on individuals with £10,000 to £20,000 ($13,400 to $26,800) and stablecoins with £10 million ($13.4 million). Digital asset industry officials criticized the plan as infesible. Central Bank Governor Andrew Bailey expressed skepticism about stablecoins in July, highlighting the potential threat to financial stability and warning global investment banks not to develop their own currency. — Jamie Crowley read more.
- The Securities and Exchange Commission is still considering officially enacting an “innovation waiver” to help businesses leverage digital assets and other innovative technologies in the United States, and could potentially end this quarter as early as the end of the quarter, said the committee’s chairman Paul Atkins. Atkins said at a Futures and Derivatives Law Reporting event hosted by law firm Katten Muchin Rosenman LLP on Tuesday in midtown Manhattan, he acknowledged that the current government closures have “stifled” the SEC’s ability to advance rules, but that working on the exemption towards the end of the year or the first quarter of 2026 will remain a priority. The SEC Chair opened the door with one of the most commonly used cliches: cryptocurrency is the “first job,” and the agency has become an innovation advocate for developers and entrepreneurs to encourage development in the United States. Nikresh De read more.
calendar
- October 13th-15th: Digital Asset Summit, London
- October 16th-17th: European Blockchain Convention, Barcelona
- November 17-22: Devconnect, Buenos Aires
- December 11-13: Solana Breakpoint, Abu Dhabi
- February 10-12, 2026: Consensus, Hong Kong
- February 17-21, 2026: East Denver, Denver
- March 30th – April 2: EthCC, Cannes
- May 5-7, 2026: Consensus, Miami