Core Foundation obtains a court injunction to prevent Maple Finance from competing with Bitcoin yield products.

In 2025, the Grand Court of the Cayman Islands officially approved Core Foundation's injunction application against Maple Finance, preventing it from launching the competing Bitcoin yield product syrupBTC. Court documents show that the judge recognized there are “serious issues to be tried” regarding Core's allegations of Maple's suspected abuse of confidential information obtained during cooperation and violation of the 24-month exclusivity clause.

The ban also restricts Maple's trading activities involving CORE tokens until the arbitration process is completed. This dispute stems from the lstBTC product that the two parties collaborated on in early 2025, which brought explosive growth to Maple after its successful launch. However, the partnership broke down in the middle of the year due to allegations of unfair competition. Industry observers point out that this case could reshape the standards for cooperation agreements in the DeFi space and trigger a new round of scrutiny over the transparency of yield products.

Background of the Ban and Core Controversies

The injunction approved by the Grand Court of the Cayman Islands in 2025 marks a new legal practice phase for commercial cooperation disputes in the DeFi sector. Core Foundation issued a statement on its official X account stating that the court has temporarily prohibited Maple Finance from launching the syrupBTC product, which directly competes with lstBTC, while also restricting the platform from processing transactions related to the CORE native token. This injunction is a temporary measure aimed at maintaining the status quo until the parties resolve the dispute through arbitration, reflecting the increasing normalization of judicial intervention in commercial disputes within the cryptocurrency sector.

The core of the controversy revolves around exclusivity clauses and the protection of confidential information. According to accusations from the Core Foundation, both parties officially announced the establishment of a partnership at an event in Hong Kong in February 2025 to jointly develop a Bitcoin revenue product named lstBTC. The product design allows investors to earn income while maintaining the custody of their Bitcoin, innovatively resolving the contradiction between traditional staking and custody. Core emphasized that it made “significant financial and resource-intensive investments” in the technical development, marketing promotion, and user subsidies for this product, and these investments yielded substantial returns after the product's official launch in April, bringing “explosive growth” to Maple Finance.

However, the partnership began to show cracks in mid-2025. Core accused Maple of starting to abuse the confidential information and work results provided, secretly developing a competitive product syrupBTC while still receiving funding and resource support from Core. This behavior directly violated the 24-month exclusivity clause stipulated in the partnership agreement, which was supposed to ensure that both parties did not engage in or support the development of competitive products during the collaboration period. Core specifically emphasized in its statement that Maple's actions not only went against business ethics but could also undermine the trust foundation of cooperation in the entire DeFi ecosystem.

History of Cooperation Between Both Parties and Evolution of Products

The collaboration between Core Foundation and Maple Finance began in early 2025, with the jointly developed lstBTC product representing an important innovation in Bitcoin yield generation strategies. Unlike traditional staking solutions, lstBTC allows users to maintain full control over their Bitcoin assets while participating in various yield strategies through a complex smart contract mechanism. This design is particularly suitable for institutional investors and cautious retail users who wish to earn yields without completely relinquishing asset custody. After its launch in April, the product quickly gained market recognition, with estimates indicating that its assets under management surpassed $100 million in the first month.

From a technical architecture perspective, lstBTC utilizes advanced cross-chain bridging technology and a risk grading mechanism. After users deposit Bitcoin into a specific smart contract, they will receive an equivalent amount of lstBTC tokens, which can then be deployed in various yield strategies, including but not limited to lending, liquidity provision, and structured products. The Core Foundation is responsible for underlying protocol development and security audits, while Maple Finance focuses on user interface optimization and market promotion. This division of labor has operated well in the early stages, allowing the product to cover multiple mainstream CEX and DeFi protocols in a short period.

The success of the product also exposed the vulnerability of the partnership. According to industry insiders, the rapid growth of lstBTC made Maple Finance see the huge market potential of Bitcoin yield products, which led to the idea of independently developing competitive products. syrupBTC is highly similar to lstBTC in product design, but has made slight adjustments in yield distribution mechanisms and risk control parameters. Although these adjustments do not constitute technological innovation, they are enough to create direct competition in the market. More seriously, Core accused Maple of directly using the proprietary code and commercial data it developed for lstBTC in the development of syrupBTC.

Key time nodes of dispute between both parties

• February 2025: Core announces collaboration with Maple in Hong Kong to jointly develop lstBTC
• April 2025: lstBTC product officially launched, quickly gaining market recognition
• June 2025: Core accuses Maple of starting to misuse confidential information to develop syrupBTC.
• August 2025: Core applies for an injunction to the Cayman Islands court
• September 2025: The court approves a temporary injunction prohibiting syrupBTC from launching.
• To be determined: Both parties will enter arbitration proceedings to resolve the dispute.

The market's reaction to this dispute is quite complex. Some investors are concerned that the legal dispute may affect the security of their assets, especially those who have already participated in the lstBTC yield strategy. On the other hand, observers in the DeFi space point out that such cooperative disputes are common in traditional finance, but they appear more prominent in the decentralized finance environment because they challenge the original idea of “code is law.”

Key Points of Legal Rulings and Court Reasoning

The Honorable Justice Jalil Asif KC of the Grand Court of the Cayman Islands clearly stated in the ruling that the allegations by the Core Foundation against Maple Finance present “serious issues to be tried.” This legal statement indicates that the court believes the evidence provided by the plaintiff is strong enough to warrant a formal process to thoroughly examine the substance of the dispute. Notably, the court accepted Core's argument that damages would not be sufficient to compensate for the losses, citing the risks associated with Maple's handling or sale of CORE tokens, as well as the “first-mover advantage” that could be gained from launching competitive products.

The court documents detail the core rationale supporting the injunction. First, regarding the allegations of misuse of confidential information, the judge found preliminary evidence suggesting that Maple may have improperly used the technical documents and business data obtained during the collaboration. This information includes the smart contract architecture of lstBTC, risk parameter setting methods, and user acquisition strategies, all of which are considered confidential content with commercial value. Secondly, concerning the violation of exclusivity clauses, the court acknowledged that a 24-month exclusivity period has reasonable commercial significance in the rapidly changing DeFi space, and unilateral violation could cause irreparable harm to Core.

A key business consideration is also involved in the ruling: the injunction balance test. The court needs to find a balance between preventing potential misconduct and not affecting Maple's normal business operations. The final injunction only targets the launch of syrupBTC and specific transactions of the CORE token, and does not comprehensively restrict Maple's other business activities. This precise limitation reflects the court's understanding of the complexity of DeFi business and also avoids systemic risks caused by excessive intervention. At the same time, the court requires Core to provide corresponding collateral to compensate for potential losses to Maple if the allegations are unfounded.

From the perspective of legal precedent, this case may become an important reference for commercial cooperation disputes in the cryptocurrency field. Unlike the Uniswap token distribution case in 2023 and the Curve protocol governance dispute in 2024, this case directly involves the application of traditional commercial law concepts in the smart contract environment. The court's ruling indicates that even DeFi protocols executed entirely on-chain are still bound by conventional legal frameworks regarding their underlying commercial arrangements, providing a clear path for the resolution of similar disputes in the future.

Market Impact and Industry Insights

This legal dispute occurred during a critical period of rapid development in DeFi yield products, and its impact on the industry may far exceed the scope of individual cases. According to DeFiLlama data, by August 2025, the total locked value of Bitcoin yield products in the entire market has exceeded $5 billion, with an annual growth rate of 150%. lstBTC, as one of the leaders in this field, once accounted for 15% of the market share, and its cooperation model with Maple is considered a benchmark by many projects. This dispute will undoubtedly trigger a re-evaluation of similar cooperation structures in the market.

For investors, the most direct concern is the issue of asset security. The Core Foundation specifically mentioned in a statement that Maple announced a “write-down” on deposits of Bitcoin worth millions of dollars after the controversy arose, which should have been protected by a price protection mechanism. Core questioned the legitimacy of Maple's refusal to return Bitcoin to the lenders, believing it reflects its “concerning behavior and business practices.” Although Maple claims its overall business operations are normal, sensitive users have begun to transfer assets to other protocols, resulting in a decrease of approximately 12% in the locked amount of lstBTC within a week.

From the perspective of industry standards, this case highlights the importance of standardizing legal documents for DeFi projects. Many early projects, in pursuit of rapid development, often used simplified collaboration agreements or relied entirely on smart contract code. The dispute between Core and Maple indicates that even in a “trust-minimized” blockchain environment, explicit traditional legal agreements are still indispensable. In the future, mature projects may place greater emphasis on the rigor of collaboration terms, including more detailed definitions of confidential information, clearer scopes of exclusivity, and more完善的 dispute resolution mechanisms.

Analysis of the Competitive Landscape of DeFi Yield Products

The Bitcoin yield product market is undergoing a transition from a blue ocean to a red ocean, and the dispute between Core and Maple is, to some extent, an inevitable result of intensified competition. Currently, the main yield products in the market can be divided into three categories: native staking derivatives such as stBTC, liquidity provision tokens such as LP-BTC, and structured products such as the controversial lstBTC this period. Each product category has its own characteristics in terms of risk-return profile and technical implementation, but all aim to address the fundamental limitation of the Bitcoin network's lack of a native yield mechanism.

From the perspective of participant backgrounds, the field has formed a tripartite situation with traditional financial institutions, native crypto projects, and hybrid teams. Products launched by traditional institutions like Morgan Creek Digital emphasize compliance and risk control, while DeFi veterans like Aave and Compound focus on code security and decentralization. Meanwhile, collaborative projects like Core and Maple attempt to balance innovation and user experience. This diversified competition not only drives product progress but also increases the probability of business disputes, especially when parties have inconsistent understandings of market boundaries and intellectual property.

In terms of technological development trends, Bitcoin yield products are evolving from simple single-chain staking to cross-chain composite strategies. The latest products can achieve seamless flow of Bitcoin across Ethereum, Solana, and multi-chain ecosystems, while participating in yield generation across multiple protocols. This complexity, while enhancing capital efficiency, also brings new risk points, including bridge security, oracle manipulation, and protocol dependence. In the coming months, with the further development of the ecosystem after the Bitcoin halving, the yield products market is likely to undergo a new round of reshuffling.

Investor Risk Warning and Response Strategies

In the face of the increasingly complex legal and technical risks in the DeFi space, investors need to adopt a more systematic risk management approach. First, it is essential to distinguish between protocol risk and business risk. The former includes smart contract vulnerabilities and flaws in economic models, while the latter involves cooperation disputes between project parties, as demonstrated in this case. For users investing in Bitcoin yield products, it is advisable to regularly review several key indicators: whether the actual yield of the product aligns with the promised yield, whether the custody solution is truly non-custodial, and whether the legal relationships between project parties are clear.

Diversification of assets is an effective strategy to reduce single risk. Considering the potential impact of the Core and Maple dispute, investors may consider allocating assets to multiple unrelated yield protocols, such as using Lido's stBTC, MakerDAO's savings module, and other independent projects simultaneously. At the same time, it is also important to pay attention to the governance token holding structure of the projects; overly concentrated token distribution may increase the risk of opaque business decisions. For institutional investors, directly participating in governance or requesting project parties to disclose more cooperation details may be a more proactive risk management approach.

From a regulatory compliance perspective, this case also provides important insights. The ruling of the Cayman Islands court indicates that even within decentralized protocols, traditional laws can still find applicable space. Investors should prefer projects with clear jurisdictional statements and understand the consumer protection laws of the relevant regions. At the same time, as regulatory bodies such as the U.S. SEC deepen their focus on the DeFi sector, yield products that meet regulatory requirements may gain long-term advantages, even though they may sacrifice some profitability in the short term.

When the injunction from the Cayman Islands court meets the immutable code of smart contracts, and when traditional business ethics collide with the idealism of decentralized finance, the dispute between Core and Maple has transcended individual cases, becoming a landmark event in the maturation process of DeFi. In the emerging market of Bitcoin yield products worth hundreds of billions of dollars, law and code, cooperation and competition, innovation and compliance are all seeking a new balance. Perhaps the greatest insight from this dispute is that, no matter how technology evolves, trust and responsibility inherent in the nature of business are always the cornerstone of ecological prosperity, and how to use decentralized tools to uphold these values will be a long-term issue facing the entire industry.

FAQ

What is the core of the dispute between Core Foundation and Maple Finance?

The core of the controversy is that Maple is accused of abusing Core's confidential information during the collaborative development of lstBTC, violating a 24-month exclusivity clause to develop a competing product syrupBTC. Currently, the court has issued a temporary injunction to prevent the launch of that product.

What impact does the ban have on the normal operations of Maple Finance?

The ban only restricts Maple from launching syrupBTC and processing specific transactions of CORE tokens, while its other operations can continue normally. However, legal disputes may affect user confidence and partnerships.

How should investors assess the legal risks of Bitcoin yield products?

Attention should be paid to the transparency of the project party's cooperation agreements, jurisdictional statements, and dispute resolution mechanisms. Prioritize products with clear legal frameworks and insurance protections, and appropriately diversify investments.

Are such disputes common in the DeFi space?

With the development of the industry, commercial cooperation disputes are gradually increasing, but those resolved through formal legal procedures are still a minority; this case may set an important precedent for similar disputes in the future.

When is the arbitration result expected to be released?

Arbitration procedures in the cryptocurrency field typically take 3-6 months, but complex cases may extend this duration, and the results will directly affect the lifting or continuation of injunctions and potential damages.