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After the inscription craze has temporarily come to an end, Bitcoin Layer 2 people are placed with high hopes of taking over the prosperity of the Bitcoin ecosystem.

At present, Bitcoin Layer 2 is showing a momentum similar to that of Ethereum Layer 2, attracting a large number of entrepreneurs to enter the market. In addition to the well-known Layer 2 protocols such as Lightning network, Liquid Network, and Stacks, the Bitcoin ecosystem has also seen the emergence of a large number of new projects claiming to be Bitcoin Layer 2 such as B² Network, BEVM, Dovi_L2, and Map Protocol.

Du Jun, the co-founder of ABCDE Capital and Huobi, said that he will bring 50 million US dollars to deeply participate in the construction of the Bitcoin ecosystem, and Bitcoin Layer 2 is the preferred track.

Bitcoin Layer 2 has also seen a wave of financing and has been favored by investors.

Recently, Bitcoin Layer 2 network Bitfinity completed $7 million in token financing at a valuation of $130 million, with Polychain Capital and others participating in the investment.

Domo, the founder of Bounce Finance and Brc-20, participated in the angel round of financing for Nubit, the data availability layer of Bitcoin. Some crypto users regard Nubit as the "Celestia" of the Bitcoin ecosystem.

After Inscription created a new way of issuing assets, how will Bitcoin Layer 2 expand more functions and ecosystems beyond payment for the Bitcoin network, and can it replicate the prosperity of Ethereum Layer 2?

20 Early Bitcoin Layer 2 Projects Worth Watching

In mid-2023, Ethereum founder Vitalik suggested in a Twitter Space about the Bitcoin ecosystem that Bitcoin is more than just a payment method, it needs a scaling solution like Plasma or ZK Rollup. Optimism and Arbitrum are two successful Rollups that can serve as case studies for Bitcoin.

Judging from some Bitcoin layer 2 projects that have emerged in the past two years, many projects have indeed adopted expansion solutions such as Rollup. At the same time, many projects also emphasize EVM compatibility. In addition, there are some Bitcoin layer 2 projects that combine AI narrative.

1、Rollup#rollup

B² Network

Founded in 2022, B² Network is a Bitcoin second-layer network developed based on ZK-Rollup. It is compatible with EVM and enables EVM ecosystem developers to seamlessly deploy DApps.

B² Network participated in the roadshow of ABCDE's Bitcoin ecosystem project in November 2023 and eventually received investment. According to ABCDE, the core members of the B² Network technical team are active members of mainstream Web3 open source communities such as Ethereum, Bitcoin, Cosmos, and Sui, and have received multiple Grant support. The team is good at Web3 Infra products such as blockchain Layer 1, Layer 2, cross-chain, and account abstraction, and has mature engineering capabilities.

On December 18, 2023, B² Network announced the launch of the Alpha testnet MYTICA for its partners and publicly recruited ecosystem developers. Partners and developers can deploy DApps on the B² Network testnet.

B² Network’s ecological project cross-chain protocol Meson has deployed the stablecoin USDC on the B² Network Alpha test network. Meson is a cross-chain protocol that focuses on speed, stability, security and low fees. It supports the free circulation of mainstream digital assets such as ETH, BNB, USDC, USDT between B² Network and more than 30 mainstream public chains.

On January 3, B² Network announced a $1 million donation plan to incentivize ecosystem builders.

B L2（B L2 T ）

B L2 is a Bitcoin ZK-Rollup Layer 2, built on the DA layer of the VM general protocol and modular blockchain Celestia. It introduces ZK-Rollup to Bitcoin and implements multi-node ZK verification on the Layer 2 network, and supports inscription chain backup and cross-chain.

B L2 launched the BRC-20 token $B L2 T with a total supply of 21 million, which is used for BTC network L2 governance, and 20% is used for gas fixed destruction. On January 8, B L2 conducted an IDO on Turtsat at a price of 30 Sats (about 0.013 U).

Chainway

Founded in 2022, Chainway is a blockchain infrastructure company focused on Bitcoin, Ethereum, and zero-knowledge technology. Chainway developed Bitcoin's ZK Rollup, browser extension tool OrdinalSafe, and zk tool Proof of Innocence.

Chainway recently stated on its official social media that it plans to launch the Bitcoin ZK Rollup public mainnet in 2024 and establish a Bitcoin ZK Rollup community.

Bison

Founded in 2023, Bison is a Bitcoin-native zk-rollup that increases transaction speeds while enabling advanced functionality on native Bitcoin. Developers can use zk-rollups to build innovative DeFi solutions such as trading platforms, lending services, and automated market makers.

Bison also participated in the ABCDE Bitcoin Ecosystem Project Roadshow. According to the introduction, the Bison solution uses zero-knowledge proofs and Ordinals for fast and secure transactions. All data is anchored back to Bitcoin for enhanced security. Bison can achieve 2,200 transactions per second, and its fee is 1/36 of Bitcoin.

The Bison team includes Starknet’s own code contributors.

Rollux

Founded in 2023 and developed by Layer 1 blockchain Syscoin (SYS), Rollux is an EVM-equivalent optimistic rollup that inherits the security of Bitcoin's mining network and Syscoin's Layer 1 data availability.

It is reported that Syscoin announced in June 2022 that it had obtained a US$20 million ecological development fund from the cryptocurrency exchange MEXC.

Rollux will be launched on the mainnet in June 2023 and has stated that it plans to switch from Optimistic Rollup to ZK-based Rollup. Rollux has not yet launched a new token, but instead uses Syscoin as a Gas token.

BOB#BOB

Founded in 2020, BOB (Build On Bitcoin) is an EVM rollup stack with native Bitcoin support. It allows developers to build decentralized applications on top of Ordinals, Lightning, and Nostr.

Currently, BOB has launched a public testnet, which is running in real time on the Sepolia Ethereum testnet. According to the roadmap of BOB's official website, BOB will first integrate Bitcoin's security through PoW re-staking and upgrade Optimistic Rollup to ZK proof.

Hacash

Hacash.com was founded in 2022. Compared with side chains and simple OP/ZK Roll-ups, the solution proposed by Hacash.com looks like an "ultimate patchwork" (no derogatory meaning) because it not only establishes a state channel but also performs multi-layer expansion. Unlike the side chain with two-way transmission, the Hacash principle is to realize the one-way transfer of Bitcoin at Layer 1, that is, without changing the user's private key, Bitcoin is transferred to the Hacash chain, and the payment operation is completed on the state channel deployed through Layer 2. At the same time, the Hacash team also proposed the Layer 3 concept on this basis to achieve ecological expansion.

The Hacash Layer 1 network has been running since 2019, and still uses PoW as the underlying consensus mechanism. Through the three PoW currencies HACD, ​​BTC and HAC, the self-regulating supply system realizes coin issuance, distribution and settlement to solve the problem that Bitcoin lacks currency attributes. Layer 2 is a channel chain for building payment settlements, which is mainly used for large-scale payments and is also the infrastructure of L3. Layer 3 is an ecosystem for multi-chain interaction and application construction to support asset issuance, smart contract operation, and face data interaction and cross-chain.

Ken You, co-founder of Hacash.com, once published an article titled "ZK-Rollups Top Three Possibilities for Scaling Bitcoin", in which he took the application of ZK roll-up to a new chain as an example. It seems that the team already has the intention to apply ZK Roll-up to build a new chain.

Be L2

Be L2 is a Bitcoin Layer 2 launched by layer 1 blockchain Elastos (ELA). It is a BTC Rollup that will allow Bitcoin to include smart contracts and irreversible digital agreements. These smart contracts can be fully defined, managed, tracked, and modified on Bitcoin without the need for intermediaries.

The network will also allow users to stake their Bitcoin holdings and earn returns when they interact with applications built on Be L2.

Elasto plans to announce Be L2-enabled partnerships and use cases in areas such as financial services, entertainment, and real-world assets (RWA) in the coming months.

2. Bitcoin Sidechain

Free（FREE）

Founded in 2022, Libre is a Bitcoin L2 sidechain dedicated to scaling Bitcoin's performance by increasing its speed and usability.

The Libre mainnet was launched on July 4, 2022. Shortly after the mainnet was launched, Libre released an airdrop of 10 million LIBRE, but only 277,000 LIBRE were claimed. In addition to the layer 2 blockchain, Libre also launched a beta version of BRC 20 Dex and a mobile APP to facilitate users to trade inscriptions.

3. Bitcoin Data Availability Layer

He is getting married

Nubit was founded in 2023 and is the data availability layer of the Bitcoin ecosystem, used to change the way transactions are processed on the Bitcoin network. Its development team, the Riema team, proposed BRC-1310, a specialized Bitcoin native data availability standard that is implemented by adopting multiple advanced technologies. These include Bitcoin native staking, data availability sampling technology, data proof directly on the Bitcoin network, and decentralized bridges.

On January 4, Bitcoin Layer 2 protocol Nubit announced that it had received angel round financing from domo, the founder of Bounce Finance and Brc-20.

4. Integration with AI

x. THIS

x.TAI is a Bitcoin Layer 2 network based on AI encryption algorithm. In December 2023, x.TAI announced that it will release the second-layer inscription chain xTAI Network based on its XRC 20 protocol, and its BRC 20 inscription xtai will be used as the ecological governance token.

According to x.TAI’s official Twitter account, the details of xTAI Networkx were originally scheduled to be announced on January 1, but x.TAI did not release it on time and there is currently no specific new release schedule.

AiPTP（ATMT）

AIPTP was established in 2023 and is a decentralized AI network based on blockchain. AIPTP will build a dual L2 network for Bitcoin. Including Bitcoin L2 with POS mechanism (tentatively designated as AIS) supports AIPTP's training model; Bitcoin L2 with PoW mechanism (tentatively designated as AIW) supports AIPTP's reasoning model. Bitcoin and ATMT can be circulated across three chains, among which ATMT adopts burn+mint cross-chain circulation method, and Bitcoin adopts pledge A chain to release to B chain for cross-chain exchange.

5. Others

BEVM

Founded in 2023, BEVM is a decentralized Bitcoin L2 compatible with EVM. Based on technologies such as the Schnorr signature algorithm brought by the Taproot upgrade, BEVM allows BTC to cross-chain from the Bitcoin mainnet to Layer 2 in a decentralized manner. Since BEVM is compatible with EVM, all DApps running in the Ethereum ecosystem can run on BTC Layer 2 and use BTC as Gas.

On November 29, 2023, BEVM released its white paper.

BEVM has now launched the pioneer network ChainX. The 2023 BEVM pioneer network annual data released by BEVM shows that its total transaction volume is 2.77 million, the total number of active addresses is 55,000; TVL reaches 119.56 BTC (about 5.09 million US dollars); the total bridge capacity to and from Ethereum L2 is 11.53 million US dollars. Recently, the BEVM pioneer network launched the first inscription protocol Bevscriptions, which processed 3 million transactions in 6 hours, with a tps of about 150.

In December 2023, the first Odyssey event was launched and has now ended. Gavin (@gguoss), founder of BEVM, said that the second phase is expected to start on January 15, and 10-20 ecological projects will be invited to participate. The name of the second phase of the event will not use "Odyssey". Instead, it will be named "Helsinki", the place name of the first BTC block mined by Satoshi Nakamoto.

Currently, the BEVM ecosystem has more than 20 ecological projects, including BTC full-chain DEX OmniSwap, decentralized signature protocol Bool Network, etc.

Dovi（DOVI）

Dovi was founded in 2023 and is a Bitcoin Layer 2 compatible with EVM smart contracts. In November 2023, Dovi officially released its white paper. The white paper introduces that Dovi integrates Schnorr signatures and MAST structures to improve transaction privacy, optimize data size and verification process; a flexible framework for issuing various asset types other than Bitcoin, and realizes cross-chain asset transfer.

KuCoin Labs announced a strategic investment in Dovi in ​​December 2023, and its native token DOVI was launched on the KuCoin trading platform on December 12 of that year. The distribution of the Dovi protocol's token DOVI follows a fair release model. Within 4 hours of the launch, all 15 million tokens were claimed. As of January 15, DOVI's fully diluted market value was approximately US$9.4 million. Currently, users can stake DOVI on the official website to receive rewards.

According to Dovi’s official website, the next step will be to release a test network, establish developer community and ecosystem support, and launch Dovi V1.

ZeroSync

ZeroSync was founded in 2022 to scale Bitcoin through zero-knowledge proofs (ZK-Proofs, ZKP). Its main application is to enable almost instant synchronization and verification of blockchains by all nodes on Earth through Blockstream satellites. At the end of 2023, ZeroSync team member @lucidLucky released the first chain status proof in space via @Blockstream satellite.

ZeroSync is based on STARK proofs and will use the Cairo language created by StarkWare. ZeroSync will be launched in three consecutive phases, namely header chain proof, assumed valid chain proof and full chain proof. The first two prototypes have been completed. ZeroSync Toolkit will also provide tools for Bitcoin developers to apply zero-knowledge proofs to their own products and services. It is reported that the development of ZeroSync has been sponsored and supported by StarkWare, OpenSats, Spiral, and geometry.

On October 9, 2023, Robin Linus, head of the ZeroSync project, published a white paper titled "BitVM: Compute Anything On Bitcoin", which sparked widespread discussion on improving Bitcoin's programmability. BitVM stands for "Bitcoin Virtual Machine", which is designed to allow developers to run complex contracts on Bitcoin.

Map Protocol

Founded in 2019, MAP Protocol is a Bitcoin Layer 2 for peer-to-peer cross-chain interoperability. By leveraging Bitcoin's security mechanisms, MAP Protocol allows assets and users from other public chains to interact seamlessly with the Bitcoin network. It not only enhances network security, but also enables BRC 20 cross-chain capabilities.

MAP Protocol recently announced that it has received strategic investments from DWF Labs and Waterdrip Capital.

It is reported that MAP and MAPO are both native tokens of MAP Protocol, which are the same tokens but use different code symbols to distinguish the chains they are on. On December 18, MAP Protocol announced the launch of a large-scale token destruction, with a total of 133,886,020 MAP/MAPO, accounting for 5.9% of the circulating supply. As of January 15, the fully diluted market value of MAP is approximately US$260 million.

The roof

Founded in 2017, Tectum is a distributed ledger protocol management platform whose ecosystem includes Tectum Blockchain, Tectum Wallet, Tectum Token (TET), Tectum SoftNote and 3 FA authentication application.

Among them, Tectum SoftNote is a non-custodial Bitcoin Layer 2 that can expand the transaction volume on Bitcoin to hundreds of thousands or even more than one million transactions per second.

Tectum’s native token is TFT, which can be used to mint SoftNote, pay reduced merchant fees, mint T 12-20 standard project tokens, and access other Tectum/CrispMind products. Currently, TET has opened the mainnet staking. As of January 15, TFT’s fully diluted market value is $275 million.

Bitfinity

Bitfinity (formerly InfinitySwap) was founded in 2021 and is based on the Internet Computer, EVM-compatible Bitcoin Layer 2 network. Previously, the InfinitySwap business was to make BTC collateral mainstream through AMM and was called the "Uniswap" of the Internet Computer (ICP) blockchain network.

Recently, Bitfinity completed a $7 million token financing with a valuation of $130 million, with participation from Polychain Capital, ParaFi Capital, Dokia Capital and Draft Ventures. In 2021, Bitfinity also received $1.5 million in seed round financing from Polychain, a16z Crypto, Internet Computer, Dfinity, and Draft Ventures.

Currently, Bitfinity is in the testnet stage and the mainnet launch time has not yet been announced.

BitBolt

BitBolt Network is a Bitcoin Layer 2 network that leverages technologies such as account abstraction and threshold ECDSA, dedicated to Bitcoin payments and the Ordinals ecosystem. BitBolt enables users to conduct Bitcoin transactions at lightning speeds while ensuring low transaction fees and the utilization of smart contract functions. BitBolt Network has launched the Thunder test network.

In July 2023, BitBolt Network conducted an IDO, but the subsequent team stated that the IDO did not achieve the goal of raising 3 bitcoins, so it decided to refund the addresses participating in this IDO.

DFS

DFS Network is a Bitcoin Layer 2. It announced the launch of its mainnet on January 1 and started mining its mainnet token DFS on January 3. It is reported that the functions of the initial version of the DFS Network mainnet are very simple, including only Swap, liquidity mining, on-chain friend circle, node voting, mainstream BRC 20 inscription cross-chain deposit and withdrawal transactions, etc.

According to official information, DFS is the mainnet token of DFS Network. In addition to mainnet governance, it will also be used to repurchase and destroy part of the dex fees. The total amount of DFS is 10 million. Currently, 1 million DFSNs have been fairly distributed on the BTC chain, and 2.5 million DFSs have been fairly distributed on the EOS chain. They will be mapped 1:1 and airdropped to the DFS Network, and the remaining 6.5 million will be fairly released through liquidity mining. The relationship between DFSN and DFS: 1 DFS = 1 DFS, 1 DFSN = 1 DFS + 1 meme (BRC-20). 0.05% of the swap fee will be used to destroy DFS.

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