Bitcoin Project Citrea Deploys Bridge to Tackle Collateral Bottleneck of Using BTC in DeFi

April 23, 2025

A project aiming to expand Bitcoin’s utility is tackling the collateral requirements of bridging the blockchain to programmable layer 2s.

Rollup project Citrea deployed its Clementine Bridge on the Bitcoin testnet. The bridge uses the BitVM2 programming language to expand the provision for decentralized finance (DeFi) on Bitcoin, by using it to verify layer 2s and sidechains that are fully programable in the way Bitcoin isn’t.

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“A secure bridge between Bitcoin and a secondary layer has always been a bottleneck for using BTC in a programmable environment,” Citrea said on Monday.

Clementine is designed to solve this by providing a trust-minimized way to bridge bitcoin (BTC) for use in DeFi environments.

The BitVM family of computing paradigms, which could allow Ethereum-style smart contracts on Bitcoin, often lies at the heart of attempts by developers to make the network more programmable and thus allow BTC to power DeFi activities.

However, BitVM is hampered by the requirement to deposit BTC as a security mechanism each time a computation is initiated.

“We reuse the operator’s collateral, allowing them to facilitate multiple peg-outs with a single collateral,” Citrea co-creator Ekrem Bal told CoinDesk in a Telegram message.

Peg-outs refer to the process of moving assets from a sidechain back to Bitcoin, triggering the release of the locked BTC collateral on the main chain.

Citrea deployed Clementine on the original BitVM design last September. Citrea’s latest bridge uses BitVM2, an upgrade that boasts improvements such as allowing any participant to challenge suspicious transactions, not just a fixed set of operators.