Coinspeaker Bitfinity Launches Bitcoin Layer 2 Solution with $12M Funding
On November 19, 2024, Bitfinity Network entered the Bitcoin ecosystem with the official introduction of its Bitcoin Layer 2 (L2) solution. Backed by $12 million in funding, the initiative aims to integrate Ethereum-compatible decentralized finance (DeFi) capabilities into Bitcoin, expanding its utility beyond serving as a store of value.
The project has attracted robust institutional backing, with key investors such as Polychain and ParaFi offering substantial support earlier in the year. Furthermore, it secured an additional $5 million through over-the-counter (OTC) token sales, fueled predominantly by grassroots contributions from the Bitcoin community.
Bitfinity’s Bitcoin L2 Boosts Scalability and Versatility
The launch of Bitfinity’s Bitcoin Layer 2 solution represents a pivotal advancement in Bitcoin’s scalability and functionality. Utilizing Internet Computer Protocol’s (ICP) Chain Fusion Technology, Bitfinity enables seamless interaction between Bitcoin-native assets and Ethereum’s ecosystem. As Bitcoin garners increasing attention from institutional investors and recently exceeded $92,000, the push to integrate Bitcoin BTC $92 508 24h volatility: 2.5% Market cap: $1.83 T Vol. 24h: $80.91 B into decentralized applications (DApps) and smart contracts intensifies.
Securing $7 million from institutional investors, including Polychain’s Beacon Fund, ParaFi, Draft Ventures, and the Warburg Serres fund, provides Bitfinity with robust financial backing. This capital injection positions the network to enhance scalability and expand Bitcoin’s use cases.
The platform aims to augment Bitcoin’s scalability while facilitating cross-chain compatibility, broadening the scope of Bitcoin-based applications. Traditionally, such advanced functionalities were confined to platforms like Ethereum. A spokesperson highlighted the impact of institutional ETFs and improved accessibility for financial institutions, signalling a market evolution.
“With institutional ETFs on the horizon and a new regime marking Bitcoin more accessible to institutions […] At Bitfinity, we’re […] pioneering a side-chain infrastructure layer to boost scalability, unlock cross-chain functionality, and broaden Bitcoin’s applications,” a Bitfinity spokesperson said.
Security and Smart Contracts at the Core
Bitfinity’s Layer 2 solution prioritizes security through a proof-of-stake protocol enhanced by Chain-Key technology, ensuring transaction integrity. This approach incorporates large signing committees capable of managing Bitcoin Schnorr and ECDSA transactions, surpassing the security of traditional multi-signature methods commonly employed by other Layer 2 platforms.
The platform aims to expand Bitcoin’s utility by hosting decentralized applications such as Sonic, Chapswap, Lendfinity, and Omnity Bridge. With backing from Liquity’s founder, Bitfinity also plans to introduce advanced decentralized finance solutions, further strengthening its ecosystem.
The influence of ICP’s Chain Fusion technology has gained momentum, which is evident from a 1,230% year-over-year rise in usage reported by the Dfinity Foundation as of November 2024. This growth stems from Bitcoin-native applications like Bitfinity, Rainbow Protocol, and Tap Protocol, which utilize Chain Fusion to enable direct deployment of smart contracts and advanced programming on Bitcoin.
Chain Fusion empowers Bitcoin’s smart contract functionality by enabling direct interaction with the network. This advancement brings Bitcoin closer to Ethereum’s capabilities in supporting decentralized applications and complex contract systems.
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Bitfinity Launches Bitcoin Layer 2 Solution with $12M Funding
