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According to Cointelegraph, a new Bitcoin finance protocol called Hashi has been announced on the Sui blockchain. The platform received early participation commitments from crypto institutions BitGo, Bullish, and FalconX ahead of its planned mainnet launch later in 2026. Ledger and Cubist have also joined as infrastructure partners.

Hashi is developed by Mysten Labs, the core contributor behind the Sui blockchain. Adeniyi Abiodun, co-founder and CPO at Mysten Labs, told Cointelegraph the protocol replaces intermediary-based trust with onchain verification and programmatic collateral management. The system is designed for institutional use rather than retail participation.

The protocol will allow Bitcoin holders to borrow stablecoins against their BTC holdings without converting or wrapping the underlying asset. Institutions are expected to supply the lending liquidity at launch. Additional features include insurance on BTC collateral and plans for issuing Bitcoin-backed bonds. A devnet is expected soon.

Bitcoin remains largely inactive in decentralized finance. Only about 0.22% of its total supply — roughly $3.07 billion — is currently deployed across DeFi protocols, according to onchain data cited in the Cointelegraph report. Hashi aims to address this gap by letting BTC serve as productive collateral without leaving the Bitcoin network.

For institutions, the protocol's design responds to a specific problem. The 2022 collapse of crypto lenders BlockFi and Celsius exposed the risks of rehypothecated collateral and opaque risk management. Hashi uses multi-party computation custody and Sui smart contracts with formal audits planned before launch.

As we previously analyzed in our coverage of 100 reasons for Bitcoin national reserves, the strategic case for treating Bitcoin as a productive financial asset — rather than a passive store of value — continues to gain institutional attention. Hashi's model fits directly within that broader narrative.

The timing of Hashi's announcement fits a recovering market. According to Galaxy Research via Yahoo Finance, crypto-collateralized lending reached an all-time high of $73.59 billion at the end of Q3 2025, surpassing the previous 2021 peak by 6.09%. Onchain lending now holds 66.9% of that total market, up from 48.6% four years ago.

Bitcoin-backed lending specifically has drawn renewed attention after the post-FTX contraction. Blockworks reports that as of mid-2024, the Bitcoin-backed lending market stood at approximately $8.6 billion, with projections estimating growth to $45.6 billion by 2030. Ledn alone originated $2.4 billion in loans during 2024. Coinbase re-entered the space in January 2025 with USDC loans up to $100,000 against BTC collateral.

Hashi enters this space at a point where institutional demand for transparent collateral management is at its highest since the sector's collapse. Critics note that DeFi lending protocols still carry risks from smart contract vulnerabilities and uncertain regulatory treatment. The protocol's launch also extends Sui's own institutional push: the chain's total value locked grew 220% year-over-year through 2025, driven partly by Bitcoin Finance use cases. Whether Hashi can attract sufficient liquidity from BitGo, Bullish, and FalconX to build a sustainable order book will determine whether the protocol becomes a reference point for institutional BTCFi or remains a smaller niche offering.