Rootstock's Mining Participation Hits 81% Despite 20% TVL Drop
2min read Bitcoin DeFi has experienced a significant surge in mining participation, particularly on the Rootstock platform, which saw merged mining participation reach an all-time high of 81% in the first quarter of 2025. This increase is notable given the concurrent decline in the total value locked (TVL) within the Bitcoin DeFi ecosystem, which dropped by 20% to $179.9 million. The heightened miner interest boosted Rootstock’s hash power to over 740 exahashes per second, surpassing the total Bitcoin network hashrate recorded in October 2024. This surge in mining activity indicates a robust interest in the underlying technology and potential for future growth, despite the cooling market conditions.
The decline in TVL reflects broader market cooling, with Bitcoin (BTC)-denominated TVL dropping 7.2% and US dollar-denominated TVL falling by 20% quarter-over-quarter. Although TVL briefly peaked at $244.6 million in January during a Bitcoin price rally, it trended downward from March. This trend is not unique to Rootstock, as Ethereum-based DeFi TVL also saw a sharp 27% decline in Q1, impacted by macro uncertainty and the $1.4 billion Bybit exploit. The stablecoin market on Rootstock also underwent notable changes, with USDt (USDT) remaining the leading stablecoin by value but seeing its dominance fall significantly from 41.3% in Q4 2024 to 27.5% by the end of Q1. No single stablecoin commanded over 30% of Rootstock’s stablecoin market by the end of the quarter.
Despite the decline in TVL and active addresses, which dropped by 26.5%, and new addresses, which plunged by 54.7%, daily transactions on Rootstock rose slightly by 4.3%, reaching an average of 11,524 per day. This increase in transaction volume, coupled with the surge in mining participation, suggests that the network is in a “mature phase” of merged mining growth. The increased security and reduced transaction fees, which saw a 60% reduction, have improved user experience and positioned Rootstock more competitively within the Bitcoin layer-2 ecosystem. The platform also activated its Lovell 7.0.0 upgrade, enhancing Ethereum Virtual Machine (EVM) compatibility and smart contract performance, and expanded its ecosystem through integrations with LayerZero and Meson Finance. Additionally, Rootstock launched developer-focused initiatives, including a new hackathon and enhancements to its governance platform, RootstockCollective.
The surge in mining participation can be attributed to several factors, including the increasing centralization of asset management within the DeFi space and the launch of new institutional DeFi platforms. As more institutional players enter the market, there is a growing need for secure and efficient mining operations. The merger of these platforms with existing DeFi ecosystems is likely to drive further innovation and adoption. The broader shifts in decentralized finance, including the volatility and uncertainty within the market, have not dampened the mining community's optimism about the long-term prospects of Bitcoin DeFi. The ongoing concerns around security and energy consumption are seen as challenges that can be addressed through technological advancements and regulatory frameworks. The increase in mining participation also reflects the growing confidence in the Bitcoin DeFi ecosystem, with the surge in DeFi tokens serving as a testament to the market's resilience and potential for growth. As more users and institutions enter the market, the demand for mining services is likely to continue to rise, driving further innovation and development within the Bitcoin DeFi ecosystem.
Ask Aime: Rootstock's merged mining surge despite Bitcoin DeFi TVL decline
