Bitcoin has long reigned supreme as the king of cryptocurrencies. In fact, it recently broke the key psychological $100,000 mark. 

Altcoins, though, tend to be where life-changing money is made giving incredible returns compared to Bitcoin. But while altcoins often steal the spotlight during bull runs, their meteoric rise is often fueled by a hidden catalyst: DeFi leverage. 

Whales frequently use their Ethereum as collateral to borrow stablecoins and buy altcoins, driving up prices. 

To see which altcoins I am buying along with my entry and exit prices, follow my free telegram for up to date news here! 

Why not Bitcoin? Bitcoin is technically the best asset to use as collateral; it is the least volatile and also the most liquid of all cryptocurrencies. The problem, however, has been that Bitcoin itself doesn’t have smart contracts. 

This is all changing. 

With the rise of wrapped Bitcoin (WBTC), the game is changing. And it’s this shift that could set Bitcoin up for its next explosive move. 

Let me break it down for you.. 

1. DeFi Leverage and the Altcoin Pump 

Altcoin price surges often aren’t organic; they’re driven by leverage. 

Whales use ETH as collateral in DeFi protocols to borrow stablecoins, which they then deploy into altcoins. 

This creates demand for altcoins but also increases risk due to ETH’s higher volatility compared to Bitcoin. 

2. Wrapped Bitcoin: Bridging the Gap 

The problem: Bitcoin doesn’t support smart contracts, which has limited its integration into DeFi. 

Enter wrapped Bitcoin (WBTC), an ERC-20 token pegged 1:1 to Bitcoin, enabling BTC to be used on Ethereum-based DeFi platforms. 

With WBTC, Bitcoin can now be locked into DeFi protocols as collateral, unlocking stablecoins for trading or staking. 

3. The Supply Squeeze: Why This Matters 

As more Bitcoin is wrapped and locked in DeFi, its circulating supply decreases. 

A lower circulating supply combined with growing demand is a recipe for higher prices. 

The trend is clear: as DeFi adoption grows, the amount of Bitcoin being locked up continues to rise. 

Long story short: altseason has started. 

The money from Bitcoin traditionally rotates into altcoins. This is why Bitcoin tends to consolidate, or even retrace, while altcoins take off. 

Eventually the money rotates back into Bitcoin for the next leg and for the cycle to repeat until the bullrun runs its course. 

This time money will not rotate out of Bitcoin into altcoins as it can now be used as collateral. This supply shock means that altcoins pumping is good news for Bitcoin as it will probably not experience the same retrace that it traditionally has. 

So, is Bitcoin done pumping? 

Far from it. 

In fact, its next leg up might just be powered by DeFi leverage itself.