Bitcoin News Today: Maestro CEO Warns of 540 Million Dollar Security Risks in Cross-Chain Solutions

Marvin Bertin, co-founder and CEO at Maestro, has raised concerns about the security risks associated with cross-chain solutions such as bridges and wrapped assets. These tools, while enhancing interoperability between blockchains, introduce vulnerabilities that compromise Bitcoin’s security model. Bertin’s warning underscores the fundamental security issues that these solutions present, which he believes undermine the core principles of Bitcoin’s security.

Bertin’s primary concern is the centralized key control and the creation of single points of failure in these systems. He cited incidents like the Ronin Network hack, which resulted in the theft of over $540 million, and the Wormhole bridge exploit, which led to a loss of $320 million. These incidents highlight the risks associated with bridges that rely on a limited set of signatories or custodians who control the underlying assets. When these keys are compromised, the entire system can collapse, leading to massive financial losses. This contrasts sharply with Bitcoin’s design, where control is distributed among a vast network of miners and nodes, making a single point of attack virtually impossible. Wrapped Bitcoin (wBTC), for example, relies on custodians who hold the native BTC, reintroducing a layer of trust that Bitcoin was designed to eliminate.

Beyond centralized control, Bertin points out that these solutions “drastically expand attack surfaces through complex smart-contract logic.” Bridges and wrappers are often powered by intricate smart contracts that manage the locking, minting, and burning of tokens across different chains. The more complex the code, the higher the likelihood of unforeseen bugs, vulnerabilities, or logical flaws that can be exploited by malicious actors. While Bitcoin’s scripting language is minimalist and highly battle-tested, cross-chain smart contracts often operate in less mature environments, increasing their susceptibility to sophisticated attacks. Each line of complex code represents a potential entry point for hackers, directly eroding the security posture that users might assume they inherit from the Bitcoin network.

According to Bertin, the introduction of centralized key control and complex smart-contract logic exposes wrapped BTC “to external consensus and contract risks,” thereby undermining Bitcoin’s minimal-assumption security model. As a fundamental alternative to these risky cross-chain methods, Bertin proposes “UTXO DeFi” as the solution for “on-chain, trustless and secure” Bitcoin decentralized finance. This approach leverages Bitcoin’s native unspent transaction output (UTXO) model, partially signed bitcoin transactions (PSBTs), and innovative metaprotocols like Runes and Ordinals. This enables projects to build secure, permissionless decentralized applications (dApps) directly on Bitcoin’s Layer 1 without resorting to bridges or wrappers.

Bertin shares examples such as Magic Eden, which utilizes PSBTs to facilitate secure trading of Runes and Ordinals, and Liquidium, which employs Discreet Log Contracts for non-custodial lending. These projects demonstrate how on-chain solutions can preserve Bitcoin’s inherent security and trustlessness while enabling advanced financial functionalities. However, Bertin acknowledges that there are challenges to broader adoption of UTXO DeFi. These include a steep developer learning curve for UTXO scripting, limited tooling available for developers, and potential UX friction for users navigating the complexities of crafting multi-party PSBT workflows, which are essential for many UTXO DeFi applications.

When questioned about the industry’s reliance on wrapped assets and cross-chain bridges for liquidity, Bertin insisted that the industry does not fully comprehend the systemic risks involved. He identified innovative solutions like intent-based solvers (e.g., Across, Uniswap X) that enable cross-chain swaps without bridging assets, eliminating much of the complexity that traditionally makes bridges vulnerable. Bertin’s vision for a trust-minimized DeFi future is built on native, secure primitives.

Regarding challenges faced by custodians, banks, or traditional finance (TradFi) institutions working with BTC or looking to add the crypto asset to their treasury, Bertin identified three key hurdles: regulatory uncertainty, operational and security complexity, and custody integration. Bertin’s company, Maestro, offers a specialized platform that helps these institutions overcome these challenges while staying compliant. “Maestro takes a partner-led approach to empower institutions to safely integrate Bitcoin into treasury and investment operations, while building internal expertise and confidence,” Bertin said.