The future of Bitcoin ecology: a new paradigm from wallets to cross-chain technology

Written by: BlockBeats

The Bitcoin ecosystem is no longer just about inscriptions.

Although some people are still struggling with whether the value of public chain inscriptions is a "false proposition", in fact, in addition to inscriptions, the Bitcoin ecosystem also includes several BTC L2 projects and DeFi projects under development, which have attracted the attention of a large number of developers and institutional capital. What many people don’t know is that the market value of the tokens of these projects is not low compared to some Bitcoin inscriptions.

The current Bitcoin ecosystem is at a critical moment. Although large-scale financial applications have not yet appeared in the Bitcoin ecosystem, we can already see the trend of inscriptions shifting from the primary market to the secondary market. This trend indicates that the continuous development and improvement of the financial infrastructure of the Bitcoin ecosystem is waiting for a turning point and has the potential to become a focus of continued attention in the future cryptocurrency field.

How can we seize the opportunity and lay out the next wave of ecosystems and projects? In this article, BlockBeats introduces some Bitcoin ecosystem infrastructure projects that are worth paying attention to in the long term.

Stacks

Stacks was originally called Blockstack and was founded by Muneeb Ali in 2013. Its goal is to enable smart contracts and decentralized applications (DApps) to run on the Bitcoin network. Stacks can be regarded as a second layer (L2) solution for Bitcoin.

Stacks introduces a unique consensus mechanism called Proof of Transfer (PoX), which allows Stacks to maintain the security of Bitcoin while bringing new features such as smart contracts, and it does not change Bitcoin itself. Through PoX, Stacks settles transactions on the Bitcoin blockchain while running its own autonomous state machine and consensus mechanism, expanding the scope of Bitcoin's functionality.

While anchored on the Bitcoin blockchain, Stacks is also an independent protocol that introduces the smart contract language Clarity and the virtual machine SVM (Stacks Virtual Machine) to execute these contracts on the Bitcoin blockchain, opening up new possibilities for applications such as Bitcoin DeFi and NFT.

STX is its native token, which has the functions of staking, governance, ticket smart contracts and value transfer. In 2019, Stacks' native token STX became the first token issuance approved by the U.S. Securities and Exchange Commission (SEC). In addition, Stacks also launched sBTC, which is pegged to Bitcoin, allowing Stacks to communicate with the Bitcoin network, enhancing decentralized communication and security. Unlike wBTC, sBTC is completely operated by the community and has no central custodian entity. This is also an important innovation that Stacks brings to Bitcoin.

Alex

Founded in 2021, ALEX, full name Automated Liquidity Exchange, is a Bitcoin DeFi platform based on the Stacks blockchain. ALEX's main goal is to combine the functions of Bitcoin Layer 1 and Layer 2 to provide a smooth DeFi experience. ALEX's native token is used for a variety of functions, including incentives, staking, and voting.

ALEX provides a variety of services, including an IDO (Initial Decentralized Exchange Offering) launchpad, DEX (Decentralized Exchange), staking, and lending services, and all transactions are settled on the finality of the Bitcoin network. The characteristic of ALEX is that it not only provides liquidity support for emerging projects, but also introduces a decentralized trading platform to provide liquidity for traders.

Currently, ALEX is the largest project on Stacks, with twice as many active users as Sovryn. The next phase of the platform focuses on improving the scalability and user experience of the Bitcoin economy. It is reported that the ALEX team is composed of experienced Wall Street quantitative trading experts from Credit Suisse, Goldman Sachs and Morgan Stanley. ALEX Labs has previously received investment from OKX vetures, Stacks foundation, Trust Machines and other institutions.

So far, ALEX has completed audits with CoinFabrik and Lease Authority, and launched its mainnet in January 2022. In addition, ALEX received $5.8 million in new financing led by White Star Capital, with participating investors including Cultur3, GBIC and OK Blockchain Capital. On December 20, 2023, LK Venture, a crypto investment and research institution under Hong Kong-listed company Linekong Interactive, also announced a strategic investment in ALEX Labs (proposed by Wang Feng), aiming to jointly build a broader Bitcoin financial ecosystem.

UniSat

As the main BRC20 wallet, UniSat now plays an important role in the Bitcoin ecosystem. In the early days, when the Bitcoin ecosystem was still a small circle, UniSat began to develop BRC-20 wallets, and it was still seen as an "outlier" in the ecosystem. Over time, BRC-20 has attracted huge attention on the Bitcoin network, and UniSat has become one of the early projects to seize this opportunity.

It can be said that UniSat is the first open source browser extension wallet for Ordinals on Bitcoin. It can not only store and transfer Ordinals, but also view unconfirmed inscriptions, and is completely open source. This greatly enhances its potential in the Bitcoin DeFi ecosystem. UniSat also supports instant minting, allowing users to store and transfer BRC-20 tokens more conveniently.

Another highlight is that UniSat introduced the innovative on-chain BRC20-Swap function, which allows users to swap BRC-20 tokens within the Bitcoin blockchain, opening a new chapter in Bitcoin decentralized transactions. UniSat also opened an API interface, which is developer-friendly and provides a rich set of function calls. It is worth mentioning that in the BRC20-Swap function, UniSat chose SATS as the transaction fee to empower SATS.

Recently, UniSat has also announced a series of major updates, including the launch of the UniSat Ordinals Marketplace and the integration of Atomicals, which further enhance the platform's functionality and user experience. With these technological advances, UniSat's position in the Bitcoin DeFi and NFT ecosystem is becoming increasingly important, and it is a project worth paying attention to in the long term.

ZetaChain

Founded in 2021, ZetaChain is a Layer 1 smart contract blockchain that focuses on solving the challenges of cross-chain interoperability. Its goal is to build a seamless framework that handles messaging, state synchronization, and free asset exchange between heterogeneous chains, connecting not only EVM chains such as Ethereum, Ethereum L2 rollups, Solana, Terra, and Algorand, but also non-EVM chains such as Bitcoin and Dogecoin.

Currently, some DeFi projects use the "wrap BTC" method to wrap Bitcoin into another token for use. But ZetaChain is different. When ZetaChain transfers value, it does not need to wrap assets, but instead completes the "native BTC swap" based on omnichain technology. Since wrapping/locking has no interdependency, all static funds of users are risk-free. All transactions and activities, including cross-chain transactions, are completely transparent, verifiable, and run with minimal trust.

The team is led by former Coinbase and Brave employees, as well as co-founders of 0x and BAT, and has extensive experience. ZetaChain has received support and endorsement from many top investment institutions, including Blockchain.com, Jane Street Capital, VY Capital, Smrti Lab, Sky9 Capital, Lingfeng Capital, Vistalabs, and Foundation Capital.

On November 17, ZetaChain and Sushi reached a cooperation, and Sushi will expand to ZetaChain and add native support for BTC. This new feature introduces the first native Bitcoin transaction to DeFi. As a major public blockchain that supports full chain, universal smart contracts and communication between all blockchains, ZetaChain cleverly solves the problems of "cross-chain" and "multi-chain" with the help of omnichain full-chain technology. This releases greater application potential of Bitcoin.

Recently, ZetaChain's testnet has attracted a lot of attention, with more than 1.3M wallet addresses participating. This number reflects the wide appeal of ZetaChain and the market demand for its solutions. 1.3M wallet addresses participating is a fairly impressive number for an emerging blockchain project, demonstrating its strong influence and potential growth in the blockchain community.

As an incentive for these early participants, ZetaChain announced its token distribution strategy. It is expected that 22% of the total, or 462,000,000 ZETA, will be awarded to ZetaChain contributors. Among them, 10%, or 210,000,000 ZETA, will be allocated to end users as the User Growth Pool to incentivize and reward community members for their participation and contribution. In addition, 12%, or 252,000,000 ZETA, will be allocated to developers as the Ecosystem Growth Fund to support the developer community and promote the growth of the ecosystem.

In addition, ZetaChain will also launch various wallet cooperation activities and social tasks on the mainnet as part of its mainnet promotion. With the vigorous development of the Bitcoin ecosystem, the demand for cross-Bitcoin chains has surged. At the same time, the maturity and widespread application of the Zetachain platform will be a great benefit to users and the entire crypto ecosystem. Therefore, it is also a project worthy of long-term attention.

Bounce Finance

Bounce Finance, founded in September 2020, is a decentralized auction protocol. Founded by NGC Ventures partner Jack Lu, Bounce Finance offers a diverse range of auction products, including tokens, NFTs, physical collectibles auctions, as well as tools such as SDKs and plugins.

At that time, Bounce Finance was not outstanding, and as the crypto market went downhill, it gradually faded out of the crypto users’ sight. Fortunately, the Bitcoin ecosystem became popular, and Bounce Finance can support multi-chain functions, and can create and participate in various types of auctions on different blockchain networks.

In November, Bounce Finance successfully completed the IDO auction of MUBI tokens on the Ethereum chain and achieved more than 80 times the return in a short period of time. In addition, Bounce also completed the public sale of the Bitstable project, a cross-chain DeFi protocol based on Bitcoin. On December 1, Bounce Finance launched BounceBit, a DeFi solution designed for the Bitcoin ecosystem, which will be based on Binance Bitcoin (BTCB) and powered by AUCTION. BTCB is a BEP2/BEP20 asset that is pegged 1:1 to Bitcoin and locked on the Bitcoin blockchain, enabling Bitcoin holders to participate in the DeFi ecosystem while maintaining their Bitcoin investment.

With the development of the crypto market, Bounce Finance has become an important IDO platform within the Bitcoin ecosystem. By successfully issuing multiple Bitcoin ecological project tokens in a row, Bounce Finance not only proves its ability as an asset issuance platform, but also brings significant wealth effects to users. These successful IDO projects make Bounce Finance a presence worth watching in the crypto market.

RGB

The idea of ​​issuing assets on the Bitcoin network has actually been on people’s minds for a long time. The origins of the RGB protocol can be traced back to 2016, and although the evolution of RGB can be attributed to the entire community, it was inspired by Peter Todd’s early work on client-side verification and one-time sealing.

The RGB protocol is designed to leverage the security and decentralization of Bitcoin while supporting complex functions such as asset issuance and smart contracts. RGB implements smart contract execution through client-side verification combined with the Bitcoin UTXO model, while maintaining off-chain processing of data and code, improving scalability and privacy protection.

RGB's core features include enhanced transaction security using single-use seals, support for various applications such as tokenized assets and digital identities, as well as protecting transaction privacy and reducing fees. RGB's digital assets support both homogeneous and non-homogeneous tokens, bringing new application potential and functional expansion to the Bitcoin network.

The RGB protocol is a promising development for Bitcoin that may enable a wide range of smart contract applications and digital asset functionality. It represents a new way to execute smart contracts off-chain while using Bitcoin's secure settlement layer, enhancing Bitcoin's scalability and functionality, and is a project worth paying attention to in the long term.

BitStable

BitStable is a decentralized asset protocol based on the Bitcoin network. It is embedded in the Bitcoin blockchain and provides a unique framework for the creation, trading, and management of synthetic assets. This platform enhances asset liquidity on the Bitcoin chain through a dual token system and a cross-chain compatible structure. The important components of BitStable include two tokens: DAII and BSSB.

DAII is a USD stablecoin issued by BitStable, with a total supply of 1 billion. Users can obtain it by staking ORDI or MUBI on the BitStable official website. The project has also issued some DAII on Ethereum, which can be purchased directly.

With the great success of BitStable's Launchpad on Bounce, DAII has also been more involved in more related projects on Bounce. Staking DAII is one of the options for participating in Bdid (BDID) Launchpad on Bounce, and Launchpad on Bounce can also choose to stake DAII to obtain participation qualifications.

BSSB is the governance token of the platform. The community uses it to maintain the system and manage DAII. BitStable will also incentivize BSSB holders through dividends and other measures. The total supply of BSSB is 21 million. In addition to the 50% publicly sold on Bounce Finance, the team will hold 5% of BSSB (6-month lockup and 15-month linear unlocking), the airdrop will account for 3.5%, the staking reward will account for 36.5%, and the LP will account for 5% (indefinitely locked).

TurtSat

TurtSat, which can be simply compared to Bounce Finance, plays a very similar role to Bounce Brand. It is a newly born asset issuance platform based on the community-led Ordinals open platform. Its mission is to become the Gitcoin of the Ordinals world. Anyone can build and donate to the Ordinals ecological protocol through Turtsat, participate in the Ordinals ecological construction and benefit from it. Its native token is TURT.

TurtSat will build three core business modules: Donation Protocol, indexing service and Ordinals open source tool platform. Since its launch, the TurtSat platform has launched a number of projects (BRC 20 asset protocol CHAX, BRC 20 cross-chain bridge MUBI, Ordinals aggregation platform NHUB, Ordinals lending platform DOVA, Bitcoin ecosystem game platform RAIT, etc.). These projects are early BRC 20 infrastructure construction platforms, and they have performed well after the launch of the projects.

It is worth noting that on December 21, TurtSat announced a strategic partnership with DWF Labs. Both parties will provide comprehensive support to Ordinals open source projects and ecosystem builders in the development of Ordinals infrastructure, so it is also worthy of long-term attention.

Multibit

Multibit is a bridge protocol that connects BRC20 assets to the EVM network that appeared in May this year, allowing users to seamlessly transfer tokens between the ETH chain, BNB chain, and BTC network. It aims to facilitate seamless transfer of tokens between the Bitcoin blockchain and other EVM networks, and enhance liquidity and interoperability.

Multibit completed an IDO auction on the auction platform Bounce Finance on November 12, raising 88 ETH. On November 4, it completed an IDO again on the Bitcoin network donation platform TurtSat at the same price, raising 4.64 BTC. The total amount raised in the two auctions was approximately US$350,000.

On November 14, MUBI opened with a 1140% increase, and the increase in the past week exceeded 300%. The current market value is close to 70 million US dollars. There are more than 6,000 holders. The total supply of MUBI is 901,224,547 pieces, all of which are currently in circulation.

MultiBit simplifies the process of transferring tokens between Bitcoin's BRC20 and EVM networks. First, the user transfers the BRC20 token to a dedicated BRC20 address. Once confirmed, the Multibit protocol begins to work and mints an equal amount of tokens on the Ethereum or BNB chain. The Multibit Protocol collects the tokens from all the distributed unique addresses. These tokens are securely transferred to a unified cold wallet. When the user needs to withdraw the tokens, the Multibit Protocol destroys the corresponding number of tokens from the EVM chain. The equivalent value of tokens is then transferred to the user from the secure cold wallet.