The integration of Avalon Labs’ lending infrastructure into Rootstock marks a significant milestone in the Bitcoin lending market. Rootstock, currently the fourth largest Bitcoin sidechain measured by total value locked (TVL), is set to benefit from this collaboration, as announced in a recent press release.
Avalon’s foray into Rootstock aims to elevate its position within the burgeoning decentralized finance (DeFi) landscape, specifically targeting Bitcoin-collateralized lending for various digital assets, including Rootstock’s native RBTC and RIF tokens, as well as popular stablecoins like USDC.E and USDT0, a protocol from Tether. This move is part of a broader strategy to enhance Rootstock’s reputation in the Bitcoin DeFi sector, often referred to as BTCFi.
With this partnership, Avalon joins other major players already integrated into the Rootstock network, including USDT0, LayerZero, and Solv Protocol. The objective is clear: to solidify Rootstock’s capabilities and influence within the DeFi ecosystem, while striving to scale operations to unprecedented heights.
Jason Twu, Avalon’s head of ecosystem, articulated the significance of this partnership, viewing it as a collaboration between two leading entities in BTCFi. He emphasized the shared commitment to deliver top-tier financial products not only for retail users but also for an increasing number of institutional players looking to engage more deeply with their Bitcoin assets.
Avalon’s current TVL stands at approximately $752 million, reflecting a remarkable 113% growth over the past year. However, it is crucial to note that this figure remains 62% lower than its all-time peak of $2 billion recorded in January 2025. Twu expressed optimism about the future, suggesting that the collaboration with Rootstock could help Avalon recapture the growth trajectories witnessed in late 2024.
Rootstock itself has demonstrated a consistent upward trend over the last two years, currently commanding a TVL of $255 million, significantly up from just $42 million at the start of 2023. However, despite the network’s growth, the RIF token’s market performance has not mirrored this success. Currently trading at a market capitalization of $56 million, RIF has declined nearly 25% in value over the past year. This marks an 82% decrease from its all-time high of $313 million in 2021, raising questions about how well the token aligns with the overall performance of the Rootstock network.
As the integration progresses, all eyes will be on both Avalon and Rootstock to see how their collaboration influences the lending market and the overall DeFi landscape within the Bitcoin ecosystem.
