Function FBTC (FBTC) is a synthetic asset designed as an omnichain, yield-bearing token fully backed on a 1:1 basis by Bitcoin (BTC). The project, developed by the firm Function, aims to provide financial infrastructure that allows BTC holders to earn yield on their assets by participating in structured, programmatic, and risk-managed strategies within decentralized finance (DeFi). The asset combines the security of verifiable Bitcoin reserves with the programmability of smart contracts to bridge Bitcoin liquidity to multiple blockchain networks. ^{[1] [2] [7]}​

Overview

Function FBTC was created to address the issue of idle capital within the Bitcoin ecosystem, transforming BTC from a passive store of value into a productive financial instrument. The core purpose of FBTC is to enable Bitcoin to be used in DeFi protocols for lending, staking, and liquidity provision without requiring holders to sell their underlying BTC. The project is primarily targeted at institutional investors, corporate treasuries, and sophisticated DeFi users seeking to generate returns on their Bitcoin holdings. ^{[3] [4]}​

The project was initially launched under the name Ignition before rebranding to Function in early 2025 to better reflect its mission of establishing an institutional standard for Bitcoin yield. In July 2025, the firm announced it had raised 1.5 billion in Total Value Locked (TVL). ^{[3] [5] [7]}​

System Components

The FBTC system is composed of three main architectural parts:

1. Custodial Addresses (Bitcoin Mainnet): Each qualified user who mints FBTC is assigned a unique Bitcoin deposit address controlled by the MPC nodes. The total amount of BTC locked across these addresses collateralizes the circulating supply of FBTC. ^[2]
2. Smart Contracts (Destination Chains): A suite of smart contracts is deployed on supported blockchains (e.g., Ethereum, Mantle) to manage the FBTC token's lifecycle. This includes a Bridge Contract for minting, burning, and cross-chain transfers, and the standard FBTC Contract (e.g., ERC-20) that governs the token's fungibility and supply. ^[2]
3. Off-Chain Modules: A set of services that monitor and coordinate protocol activities. These include a Bridge Monitor that observes on-chain events, a TSS Gateway that coordinates signing requests among nodes, and a Risk Control Module that vets transactions against security rules. ^[2]

Tokenomics

FBTC is a synthetic, yield-bearing asset backed by Bitcoin and issued across multiple networks, including Ethereum, BNB Smart Chain, Arbitrum, Base, Mantle, Bob Network, Plume Network, and Sonic. The token has no fixed maximum supply, as issuance expands or contracts based on BTC deposits used to mint FBTC or tokens burned during redemption. As of November 23, 2025, the token’s market capitalization and fully diluted valuation were approximately $1.01 billion, supported by a circulating supply of 11,736 FBTC. ^[1]​

Security and Governance

Asset Security and Transparency

Security of the underlying Bitcoin collateral is maintained through the use of MPC and TSS technology to eliminate single points of failure in asset custody. Transparency is enforced through a publicly available Bitcoin Reserve Address List, allowing anyone to verify the 1:1 backing on-chain. This is further supplemented by an integration with Chainlink Proof of Reserve (PoR), which automates the verification process and delivers the data on-chain for smart contracts to use. ^{[2] [5]}​

Governance and Key Roles

A Decentralized Autonomous Organization (DAO) governs the protocol, with major decisions executed via a multi-signature contract requiring a majority of member signatures. The system defines several key roles:

• Qualified Users: KYC/KYB-verified institutions or individuals authorized to mint and burn FBTC directly with the protocol.
• Security Council: A core group of trusted institutions responsible for managing the MPC multi-signature system and operating the bridge's TSS nodes. Initial members include Mantle, Antalpha Prime, and Cobo. ^[2]

Partnerships

Funding and Investors

On July 15, 2025, Function announced it had closed a $10 million seed funding round. The round was led by Galaxy Digital (GLXY), with participation from Antalpha (ANTA) and Mantle. ^[3]​

Partners and Integrations

• Galaxy Digital
• Mantle
• Antalpha
• Cobo
• Bybit
• Uniswap
• Curve
• Agni Finance
• Merchant Moe
• Oku Trade
• Babylon
• Solv Finance
• Pendle ^{[1] [2]}