Sui launches Hashi testnet for Bitcoin-backed finance with 25+ partners

Sui and Mysten Labs have launched the Hashi testnet, moving the Bitcoin-backed finance project beyond its earlier devnet stage and opening it to more than 25 institutional partners testing lending, borrowing and credit applications ahead of mainnet. The system is designed to let native Bitcoin serve as collateral while remaining on the Bitcoin network, avoiding wrapped-token and cross-chain bridge structures that have repeatedly been linked to losses across DeFi. More than 25 institutions, including BitGo, Cumberland, FalconX, Ledger, Blockdaemon and Bullish, are now conducting stress tests for BTC lending and credit services on the Hashi testnet. The current phase is intended to let developers and institutions integrate and validate products before real capital is deployed, and Hashi has not disclosed a mainnet launch schedule. Hashi uses a 2-of-2 multisig arrangement requiring signatures from both Hashi’s multi-party computation validators and a separate Guardian Layer that is intended to slow or block suspicious withdrawals. Loan terms and collateral positions are tracked onchain, giving lenders visibility into the Bitcoin backing each position. Sui said legal analysis indicates deposits and redemptions are structured to avoid taxable events under U.S. tax law. Mysten Labs Co-Founder and Chief Product Officer Adeniyi Abiodun said the protocol is meant to help build onchain credit markets around Bitcoin, which Sui pegged at roughly a $1.4 trillion market. Wave Digital Assets also said it plans to prioritize the tokenization of yield-bearing Bitcoin bonds on Sui over the next three years once Hashi launches on mainnet. If testing is completed successfully, Bitcoin holders would be able to generate yield while keeping their assets in native BTC form.