COMMUNITY

Q3 2025 Report: Protocol Performance, Market Maturity, and the Road to Native Bitcoin Lending

Shaun Janse van Vuuren

Oct 7, 2025 • 6 min read

1. Executive Summary

Q3 2025 marked another record-setting quarter for Chainflip, defined by sustained growth in network activity, continued integration momentum, and meaningful advances in product maturity. The protocol processed over $1.24 billion in total swap volume, a 42% increase quarter-over-quarter, reinforcing Chainflip’s position as the leading infrastructure for native cross-chain swaps, particularly for Bitcoin.

Operational progress this quarter was substantial. The introduction of Delegated Staking, improvements to Stablecoin Strategies, and the rollout of Live Price Protection and Internal Swaps significantly enhanced liquidity efficiency, execution reliability, and yield opportunities for participants. Together, these developments mark a shift toward a more sophisticated and complete cross-chain market structure.

Strategically, the announcement of Chainflip’s entry into native Bitcoin lending signalled the next phase of expansion. This new vertical will open up Chainflip to form the first truly accessible, decentralised, and flexible lending markets that will allow holders of native BTC to unlock the underlying asset value in a cost-effective and permisionless manner.

The size of crypto lending markets continue breaching all-time highs, and this new product line up looks upon a Greenfield sector of that market which could easily multiply protocol revenues with a moderate level of adoption within the first year.

At the protocol level, Chainflip achieved its strongest fundamentals to date. Network fees reached $734,865, and 1.21 million FLIP were permanently removed from supply through swap activity, the highest quarterly burn since mainnet launch. These metrics underline the growing connection between protocol usage, fee generation, and long-term token value creation and usability.

2. Headline Metrics

*Core network metrics for Q3 2025 show continued growth across all key areas, from swap volume and user activity to protocol revenue and token burns.*

*Q3 2025 recorded Chainflip’s highest swap volume to date at $1.24B.*

*Protocol fees climbed to $734K, reflecting continued activity growth.*

3. FLIP Burn and Token Dynamics

Q3 2025 marked the strongest quarter of deflationary activity on the Chainflip network to date. A total of 1.21 million FLIP were permanently burnt through a combination of swap fees and Boost Fee splits, bringing the cumulative burn above 4.05 million FLIP at the time of writing since mainnet launch.

*Over 1.21M FLIP burnt: The strongest quarter since mainnet launch.*

At current market prices of $0.60 per FLIP, this equates to approximately $720,000 in value removed from supply during the quarter. Based on current burn rates, the protocol’s mechanisms are on track to remove the equivalent of 6.58% of total supply annually, driven entirely by organic network usage and product participation, with no monetary incentive-driven campaigns or inflated metrics.

*Annualized FLIP burn rate continues to rise in line with protocol activity, reaching the equivalent of 6.58% of total supply burned per year.*

This model strengthens the link between usage, liquidity activity, and token value creation. As swap volume and Boost participation grow, so too does the magnitude of FLIP removal, reinforcing its position as one of the few DeFi assets with organic, usage-based deflation built directly into its core design.

4. Product and Protocol Progress

Q3 delivered several key improvements to the Chainflip protocol, strengthening performance, reliability, and competitiveness across core systems.

Delegated Staking: Launched successfully, with over 2.43 million FLIP now staked in less than a week of launch, a major step toward deeper decentralization and network security.
Swap Performance: Enhancements to routing and confirmation logic reduced average swap times, particularly for Bitcoin, making Chainflip more competitive with centralized exchanges on speed.
Bitcoin Fee Handling: Updates to fee estimation and batching logic ensured smoother swaps during BTC network congestion, improving reliability and cost efficiency.
Stablecoin Strategies, Live Price Protection, and Internal Swaps: Delivered greater liquidity efficiency, better execution, and higher reliability across supported assets.

These developments enhanced Chainflip’s technical maturity and solidified its position as the most efficient venue for native cross-chain swaps.

5. Ecosystem Expansion

Q3 marked an important step forward for Chainflip’s ecosystem reach and liquidity depth, highlighted by new integrations and a maturing network of participants.

Li.Fi Integration: Chainflip integrated with Li.Fi, one of the industry’s leading aggregation platforms, bringing native Bitcoin, Ethereum, Arbitrum and Solana routes to hundreds of applications via Li.Fi’s routing infrastructure, expanding access to Chainflip liquidity.
Polkadot Asset Hub: Chainflip completed integration with Polkadot Asset Hub, establishing itself as the de facto route to and from the Polkadot ecosystem. SubWallet was the first to support this functionality, offering direct access to native DOT and hub assets.
Growing Liquidity Provider Base: As the protocol matures, prominent and professional market makers have begun supplying liquidity, leading to deeper pools, tighter spreads, and increased protocol revenue.
Expansion into Native Bitcoin Lending: The announcement of Chainflip’s native Bitcoin lending product marks a major new vertical for the protocol, unlocking Native Bitcoin backed loans, built to get access to liquidity, powered by Chainflip’s proven technical foundation.
New product vertical expansion: Chainflip’s cross-chain lending product, announced in Q3 and set for a Q4 launch, targets the EVM-centric dominance in DeFi lending. It enables users to deploy assets productively across chains, seamlessly and permissionlessly, without the high costs of moving or wrapping assets.

6. Network and Market Performance

Chainflip’s on-chain activity and liquidity metrics continued to strengthen throughout Q3, reflecting steady organic growth across all major indicators.

Swap Volume and Activity: The protocol processed $1.24 billion in swap volume, a new record. 163,356 swaps were executed, a sharp rise in user activity and routing efficiency.
Network Fees: Total network fees reached $734,865, translating into higher protocol revenue and continued FLIP deflation.
Liquidity Efficiency: Improvements to routing, confirmation handling, and vault management contributed to tighter spreads and lower slippage across pairs.
Market Maker Participation: An expanding base of professional liquidity providers has strengthened market depth and execution reliability.
Protocol Reliability: Despite increased volume and load, uptime and execution performance remained stable, reflecting the robustness of Chainflip’s infrastructure.

With liquidity deepening, execution speeds improving, and professional market makers now active at scale, Chainflip has entered a new phase of maturity. One defined by consistent throughput, efficient pricing, and sustainable growth. This foundation positions the network strongly heading into Q4.

7. Outlook for Q4 2025

With solid foundations in place, Chainflip enters Q4 poised for continued expansion. The focus will shift toward deepening capital efficiency, enhancing liquidity products, and scaling access to new markets.

Native Bitcoin Lending: Development of Chainflip’s native BTC lending system will continue toward launch, enabling native BTC backed loans, and active LPs to borrow assets to facilitate large swaps, opening new revenue pathways for users and the protocol alike.
Enhanced Liquidity Products: Ongoing refinements to Boost and Stablecoin Strategies will improve yield performance and flexibility for liquidity providers.
Ecosystem Partnerships: Chainflip will strengthen relationships with aggregators, wallets, and infrastructure partners to expand its presence across Ethereum, Solana, and major L2s.
Operational Maturity: Focus remains on maintaining low latency, high uptime, and optimized swap routing as network volumes scale further.

Q4 represents a key transition, from protocol growth to full product diversification. With lending on the horizon and liquidity products maturing, Chainflip is set to reinforce its position as the core infrastructure layer for native, cross-chain liquidity.

8. Closing Statement

Q3 2025 was a defining quarter for Chainflip, one that underscored the protocol’s maturity, resilience, and real-world traction. Growth was driven not by incentives, but by genuine usage, deepening liquidity, and expanding integrations across the ecosystem.

With core systems now operating at scale, Chainflip enters Q4 from a position of strength. The focus ahead is clear: continue refining the product, explore new verticals, and maintain the reliability and transparency that have defined every phase of the network’s progress so far.

What began as a vision for seamless cross-chain swaps has evolved into a foundation for true multichain liquidity, built on engineering discipline, sustainable economics, and a growing community of aligned participants.

Chainflip’s vision is now expanding beyond just being the most effective protocol to move funds between chains - we now aim for Chainflip to become the primary liquidity hub for assets across chains. We stand to become the defining BTC DeFi product on the market in the coming year.

— The Chainflip Labs Team