Bitcoin's DeFi Revolution Gains Speed with Native DEX Breakthrough

Bitfinex Ventures has made a strategic investment in KaleidoSwap, a decentralized exchange (DEX) built on the Bitcoin and Lightning Network ecosystems, to support the development of the first native Bitcoin-based DEX using RGB technology. The funding, announced in a press release, is intended to accelerate the deployment of a decentralized, trustless trading platform that leverages the scalability and efficiency of the Lightning Network and the smart contract capabilities of RGB [1].

KaleidoSwap aims to enable direct BTC-USDT trading without the need for wrapped tokens or reliance on Ethereum-based infrastructure. The platform’s approach combines Bitcoin’s native asset with Lightning’s high-throughput capabilities and RGB’s smart contract functionality, positioning it as a scalable solution for Bitcoin’s DeFi ecosystem. According to Walter Maffione, CTO of KaleidoSwap, the platform will serve as a liquidity hub for the broader Bitcoin economy by facilitating a diverse range of financial applications and asset types [1].

The announcement comes after Tether’s recent commitment to bring its stablecoin, USD₮, onto the RGB protocol by August 28, 2025. This integration is expected to enhance the utility of RGB-based assets and further solidify the role of Bitcoin as a foundation for decentralized finance. Bitfinex, as a longtime supporter of RGB and Lightning technologies, sees KaleidoSwap as a key player in advancing Bitcoin’s role in decentralized trading. Paolo Ardoino, CTO of Bitfinex, emphasized that the project aligns with the firm’s vision of making Bitcoin the most efficient transaction solution globally [1].

Separately, another Bitcoin-native DEX, NightTrader.exchange, launched officially after over two years of beta testing. Unlike traditional DEXs that rely on wrapped tokens or EVM-based platforms, NightTrader enables direct trading of native UTXO-based coins such as Bitcoin, Litecoin, and Bitcoin Cash. The platform employs a threshold signature technique to enhance security and privacy, ensuring that users retain full control of their private keys [2]. This mechanism allows for high-speed trading at competitive fees—starting at 0.25%—making it an attractive option for both large-scale traders and liquidity providers [2].

NightTrader’s architecture is designed with privacy and decentralization as core principles. The platform does not collect unnecessary user data and generates keys client-side, ensuring that no third party holds user funds. Additionally, the system is open source, allowing for maximum transparency and community-driven development [2]. The platform also introduces an affiliate system, enabling users to earn passive income by referring others. This model fosters a decentralized and community-driven ecosystem [2].

Taken together, these developments highlight a growing trend of Bitcoin-native DeFi solutions that aim to enhance scalability, privacy, and trustlessness in decentralized trading. As both KaleidoSwap and NightTrader continue to evolve, they represent significant steps toward a more robust and diverse Bitcoin ecosystem, leveraging the strengths of RGB, Lightning, and native UTXO protocols.

Source:

[1] Bitfinex invests in KaleidoSwap to establish the first Bitcoin-native DEX (https://cryptobriefing.com/bitcoin-native-dex-kaleidoswap-launch/)

[2] Bitcoin's First True High-Speed DEX NightTrader Launches (https://www.marketwatch.com/press-release/bitcoin-s-first-true-high-speed-dex-nighttrader-launches-dd45cf66)