Founders Fund and Galaxy Ventures-backed Bitcoin zero-knowledge rollup (ZK-rollup) Citrea launched its mainnet on Tuesday with BTC collateral lending, BTC-structured products and a new US dollar stablecoin, ctUSD.
The launch is aimed at turning what Citrea calls “economically idle” Bitcoin (BTC) into base collateral for decentralized finance (DeFi) and payments, while anchoring more of that activity to Bitcoin’s base layer.
The team expects active DeFi liquidity to reach $50 million in the first few weeks, with BTC lending, BTC-structured products, and decentralized trading already live from day one.
The mainnet debut immediately dropped Citrea into a familiar Bitcoin argument: What should scarce BTC block space actually be used for?
With block rewards declining over time, many developers see non‑payment use cases like Citrea as essential to sustaining miner fee revenue.
However, purists argue Bitcoin’s limited capacity should be reserved for simple, censorship‑resistant payments rather than complex financial systems built on top.
CtUSD aims to fix Bitcoin stablecoin liquidity
CtUSD is issued by MoonPay, a regulated crypto payments and infrastructure company that provides fiat on- and off‑ramps for digital assets.
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It is backed 1:1 by cash and short‑term US Treasurys, and marketed as a compliance‑forward alternative to wrapped Tether (USDT) and wrapped USDC (USDC) that circulate on Bitcoin‑adjacent stacks.
Orkun Mahir Kılıç, the co‑founder and CEO of Chainway Labs, the company behind Citrea, told Cointelegraph that ctUSD was “natively issued” on its rollup rather than bridged from another chain, and wired into MoonPay’s Iron banking infrastructure.
That setup includes banking‑grade rails such as virtual International Bank Account Numbers (vIBANs), allowing users to wire in fiat that is automatically converted into ctUSD and settled onchain.
Why ctUSD’s ‘native’ design matters
Because Citrea is “the Bitcoin application layer anchored to Bitcoin’s security model,” ctUSD “inherits the security properties of the Citrea network itself.”
That reduces some of the risks inherent in other DeFi protocols, since bridged assets “inherit the security risks of their weakest link,” Kılıç said.
He added that ctUSD, by being natively issued, was safe from external bridge hacks, and “not dependent on the solvency of a third-party wrapping protocol.”
Unlike other ecosystems where “liquidity is split across multiple bridged versions of the same asset,” ctUSD is “the single, preferred stablecoin for Citrea,” eliminating the “liquidity fragmentation that typically traps capital and increases slippage for lenders and traders.”
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Kılıç argued that combining a Bitcoin‑anchored rollup with a regulated stablecoin and banking integrations was designed to “systematically boost supply” and evolve ctUSD “from a launch asset into the standard liquidity layer for the Bitcoin economy” over the next six to 12 months.
On the testnet, Citrea says its data availability usage alone accounted for almost 10% of Bitcoin’s monthly data bandwidth at one point, a sign that even pre‑launch rollup activity can consume a meaningful slice of Bitcoin block space.
Citrea launch reignites block space wars
Bitcoin core developer and Casa chief security officer Jameson Lopp called the rollout “the next grand experiment in generating sustainable demand for block space.”
Still, one follower pointed out that Citrea users are not literally lending, trading and settling on the Bitcoin network as described, but on Citrea’s Ethereum Virtual Machine, with Bitcoin only storing the proofs, effectively turning Bitcoin into a “filing cabinet” for rollup receipts.
He pointed to Citrea’s “single sequencer,” offchain treasury, and “10‑party federation,” as trust assumptions that move, rather than remove, risk. “You know the difference. You’re pretending you don’t,” he jibed at Lopp.
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