Building a Financial System on Bitcoin | WILLEM SCHROE

From Bitcoin Rails | Isabel Foxen Duke by Isabel Foxen Duke

March 17, 2026 · 1h 4m

About this episode

Willem Schroe discusses the necessity of a financial system for Bitcoin and the challenges of scaling solutions.

“People in finance understand the financial system, but not money. People in Bitcoin understand money, but not the financial system.” In a world where financial markets make up 70% of all money flow around the world — we have two choices: come up with technical solutions that enable these use-cases in a decentralized way, or simply accept that Bitcoin will be used in a custodial way whenever more complex use-cases are at play. Botanix CEO Willem Schroe is staunchly rejecting the latter — and attempting to solve some of the toughest challenges faced by the L2 and scaling landscapes (e.g. the “honeypot problem” that nearly all other L2s will ultimately face if not addressed). Willem and I break down the design space of Bitcoin L2s, why DeFi may be necessary for Bitcoin’s financial system to emerge, and how different technologies — like Spiderchains, BitVM, Lightning, and others — could eventually combine into a decentralized Bitcoin-native financial stack. In this episode, we discuss: - Why Bitcoin needs a financial system, not just payments (hint: without it, we'll end up like Gold) - The role of DeFi and stablecoins in Bitcoin adoption - The "honeypot problem" introduced by most…

People in this episode

Host: Isabel Foxen Duke

Guest: Willem Schroe

Topics covered

Bitcoin
financial system
DeFi
scaling solutions
L2 challenges
stablecoins

Keywords

Bitcoin
financial system
DeFi
L2
scaling
Spiderchains
BitVM
stablecoins

Mentioned in this episode

Organizations: Botanix

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