Bitcoin DeFi: Can Taro and RGB tip the scales to usher in mass adoption?

Bitcoin does not easily allow for the creation of a DeFi ecosystem atop its base layer. Even after the 2021 Taproot script update, Bitcoin’s native scripting features are not expressive enough, and the network’s throughput is too slow for developers to create tokens using the same approach they would on Ethereum, Cardano or Solana. Bitcoin-centric developers have been working in the background for years to overcome the limitations of not having fully-fledged smart contract features on the base layer. The resulting approaches for bringing tokens to Bitcoin are radically different but could turn out to be technically superior to traditional DeFi tokens in many respects. With possible mass adoption by the end of the 2020s, investors in smart contracts and DeFi ecosystems should be aware of the developments in alternative Bitcoin-based token layers.