StarkWare bolsters Bitcoin strategy with new strategic reserve and L2 integration

StarkWare has established a Strategic Bitcoin Reserve, committing to holding a growing share of its treasury in BTC as part of its broader push to integrate the flagship crypto into its Starknet Layer 2 network.

While it has not disclosed the size of its holdings, CEO Eli Ben-Sasson said the company is leading by example, believing that all blockchain firms will eventually hold Bitcoin.

The blockchain firm, last valued at $8 billion, has recently focused increasingly on Bitcoin research and development.

The move places StarkWare alongside other crypto firms that have adopted Bitcoin as a treasury asset. It also follows President Donald Trump’s executive order to establish a US Strategic Bitcoin Reserve.

As part of its broader Bitcoin strategy, StarkWare is integrating Xverse, a Bitcoin wallet that supports Ordinals and Runes, into Starknet. This will allow Bitcoin assets to be used within the Layer 2 network for the first time.

The company is also launching BTCFi Season, an initiative by the Starknet Foundation to introduce Bitcoin holders to DeFi applications such as lending and yield farming.

Additionally, the Braavos wallet now supports Lightning Network payments, enabling faster and more cost-effective Bitcoin transactions within Starknet.

These developments support StarkWare’s broader vision of making Starknet a key execution layer for Bitcoin, addressing its scalability challenges. The company argued that while Bitcoin is widely seen as digital gold, limited transaction speed and high fees have constrained its broader use.

StarkWare is also advocating for OP_CAT, a proposed Bitcoin soft fork that could enable trustless Bitcoin-to-Starknet bridges by allowing advanced scripting and programmable transactions.

The proposal, originally part of Bitcoin’s early design, remains a topic of debate within the community due to security considerations.

In the meantime, StarkWare is exploring alternative bridge models, including a federated multisig system that relies on a group of co-signers to secure Bitcoin and a BitVM-based solution that minimizes trust by using cryptographic dispute-resolution mechanisms.

StarkWare sees these innovations as part of a larger effort to make Bitcoin more than just a store of value, unlocking new financial applications while maintaining security and decentralization.

With additional Bitcoin integrations, partnerships, and incentives expected in the coming months, StarkWare aims to position Starknet as a bridge between Bitcoin and Ethereum, enabling greater liquidity and user adoption across both ecosystems.

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