🧙‍♂️Last ​​night, @BitmapTech jeff attended the space and shared his views on @MerlinLayer2's recent situation and the Bitcoin ecosystem with you all. It was very inspiring. For example, the narrative logic of babylon actually needs to be based on ordinals, inscriptions, and runes.

1. The original intention of MerlinChain

Our team has been very focused on user needs since the beginning. We joined the Ordinals ecosystem by accident, just wanting to make something fun, so we created Recursive Ordinals, where people can make various Ordinals for free and use them on Bitcoin Layer 1. We also created the bitmap game, a metaverse for bitmap holders. Later we built the BRC420 protocol. In short, we have been building things for fun, for ourselves, and for me, because I have always been a big fan of Ordinals.

Last year when we were building these DApps, we found that if you wanted to add some features like the Metaverse on Layer 1, it was almost impossible. The only thing you could do on Layer 1 was walk around, play music, talk to each other, and while that was cool, if we couldn't add token economics, if we couldn't add utility to the token, most users would lose interest in the long run. So when you tried to build something for these DApps, you found that you needed smart contracts, but you couldn't build it in Lightning Network, RGB, Bitcoin Layer 1, BSV or BCH. You had to adopt the EVM, and at the time I'm sure you probably had the same problem, which was that using the EVM was politically incorrect in the ecosystem because the Bitcoin OGs would say, "Oh, we don't need the EVM, the EVM is not good." But we didn't care, we just wanted to build things for users, and it would be easier for developers to build things here because they have a lot of experience in the EVM world.

So that’s where the idea for Merlin came from. We actually picked the name two weeks before the launch, so we didn’t plan it, we just took it one step at a time and then the Merlin chain came naturally.

2. Differences in User Experience in the Bitcoin Ecosystem

I think last year you would have found it very difficult for other users to join the Bitcoin ecosystem. You had to open a Unisat X wallet first, you had to understand how Bitcoin transactions work. And when you talk to other people about that, they just don't want to do it. I think the reason the price of Ordinals skyrocketed during that time was simply because people could buy them from Binance and OKEx. So if we continue to work in that way to educate the market and get these users to come to Bitcoin, who are willing to buy, I think it's going to be very, very difficult, especially with gas fees being super high. So I think that's why all of us are trying another approach, to get users from other ecosystems.

For example, on Merlin, you can use MetaMask to buy things, and there are a lot of Ordinals and BRC20 tokens here. You don't have to understand how Bitcoin works, but you can still buy their tokens before they are listed on centralized exchanges. We are also trying to make this easier, such as cross-chain DEX. So basically, if you are on BNB Chain, if you are on Solana, you don't even need to bridge your funds to Merlin. You can buy these Bitcoin assets on Merlin directly with BNB, Solana, Arbitrum on that chain because we have liquidity for these assets. Then, when the price goes up or they are listed on centralized exchanges, you can sell them. I think we should try to reduce the barriers for users, and we are also trying to do some different things in the Telegram ecosystem to get mass adoption outside the crypto world. So, I think it's a long battle, you have to wait, you have to build for a longer time, but I believe it will pay off in the long run.

3. How to attract more users into the Bitcoin ecosystem

I think getting millions, billions of external users to understand the Bitcoin narrative is the hardest part. Look at the NFT conference in New York City, a lot of people came to New York City to attend this event to try to understand the concept of Bitcoin NFTs. This year, I think the first thing that went viral was Bitcoin NFTs. A lot of people came to buy Bitcoin NFTs, bought node monkeys, bought Bitcoin frogs, bought all these NFTs.

So, I think trying to educate the market with the Bitcoin narrative is that Bitcoin is special. Everybody knows about Bitcoin, my real life friends may not know about Solana or TON network, but they know about Bitcoin, my grandma knows about Bitcoin. So, we have to spread the word and tell people why these assets are special. It's going to take a long time, but when that happens, I think people, users are going to find ways to buy these things, whether it's on Merlin, on BitLayer, on BVM, using MPC wallets, unisat wallets, OKEx wallets, they don't care. When that happens, they're going to flock to buy all of these things.

4. MerlinChain’s Liquidity Strategy

I think this basically fits into the two approaches that I mentioned at the beginning, one for retail users and one for DeFi users.

For retail users, the liquidity they need is for trading. So, I think if you look at DeFi Llama, look at all these DEXs, all these BRC20 and Ordinals tokens are trading heavily on Merlin. If you look at bitmap, on Layer 1, on Magic Eden, they have 300 to 400 bitmaps traded per day. But on Merlin, there are 500 to 800 bitmaps traded per transaction, not every day. So, thousands of bits are traded every day on DEXs, on Merlin Swap. So, I think users will eventually find that it is easier, cheaper, and a better experience to trade these Bitcoin native assets on Layer 2. We have a half-year report coming out next week, and we got $2 billion in trading volume in spot trading and another $2 billion in on-chain volume in perpetual contracts on Merlin. So, I think we will do this part for a long time because I think users will have demand for a longer period of time. Just like yesterday, we had another event with Casey's zero token called Uncommon Goods. So, we ask users to mint these assets on Layer 1, bridge to Layer 2, and we give users 10% of Uncommon Goods. We have liquidity pools on Merlin Swap and staking pools on Bitgenie. So, basically, we keep building and keep bringing these assets from Layer 1 to Layer 2. I think users will bring liquidity themselves.

I think the other part is for DeFi users, you know Babylon has a cap of 1,000 bitcoins for the first Babylon staking attempt. Basically like that, we were busy last night, we helped mint Babylon, we staked Babylon with Solv, I think we've reached 250 bitcoins, I think that's the cap. It's the number one Bitcoin liquidity token in the entire ecosystem. We also hold Bedrock, which is RockX, they have 298 bitcoins. These parts, for professional traders, professional DeFi users, they are very interested. So, we help them get liquidity, to Babylon, to other chains. In fact, now Merlin Bitcoin can go to Linea, can go to Scroll, ZKLink, Mode, all these other EVM chains. So, these users can form all kinds of new views, tokens, yields, etc. on all these other chains.

I think they have huge potential both for DeFi and retail user trading. Looking at Ethereum, I think Bitcoin is now like Ethereum in 2017, I mean in the DeFi space. So, it's still early.

5. Future Outlook for the Bitcoin Ecosystem

For me, honestly, I think the only ones that I'm personally excited about are Ordinals and Inscriptions. I mean, we help DeFi users, Babylon staking, we do all these things for DeFi users, but I'm not a DeFi user, I don't really like doing DeFi, but I am a Meme coin user.

I think the reason we're here is because Casey started Ordinals in 2022, and BRC20 started to become popular last year. That's why we're here. Before Ordinals, before this year, Merlin Chain, all these Bitcoin Layer 2s, very few people understood the world of BTCFi, they didn't believe in it. Think about what happened when we launched Layer 2 in February, most people were saying, "Oh, Bitcoin doesn't need Layer 2, Bitcoin doesn't have DeFi." Now, you can see all these teams from all over the world coming to Bitcoin to build things, you know stablecoins, DeFi, lending.

So I think it all started with Ordinals, and I still believe in Ordinals and Inscriptions. When I meet people and ask them what they think about Ordinals and Inscriptions, a lot of people say Ordinals is dead, Inscriptions is dead. That's exactly what they said in June, July, and August of last year. But ultimately, they were wrong because the real users are here. It's not like Ethereum or other chains where those fake user bots, you know, they're just clogging up the chain. In Bitcoin, most people are real users because if you want to do a transaction on Bitcoin, you have to pay a very, very high gas fee.

So, we have the narrative here, we have real users here, we have confidence in all of you, all these newcomers, VCs, exchanges. I think we can attract more users, and this activity can bring real yield. Now, we all talk about things like BTCFi, but where does the yield come from? Yield comes from network fees, yield comes from DeFi income, it comes from DEXs, it comes from being an LP in perpetual contracts, it comes from being an LP in lending protocols. So, we need users, most real-life people, they don’t even understand TradFi, how can they understand DeFi? But they understand buying collectibles, they understand buying memes and NFTs.

So, I'm pretty confident about that, to be honest.

6. Predictions for Bitcoin Ecosystem Innovation

There are always new innovations coming out. Last year it was Ordinals NFT, first the Bitcoin frog, then we had BRC20 from Domo, and before BRC20, no one knew about Domo. Then we had Bitmap, we had BRC420, we had Atomicals, this year we had Runes, and later we will have Fractals. So, I think there will be more builders innovating, and we can't predict what will happen, but I think I can confidently say that I can predict that it will happen, it's just a matter of time, and if that happens, I think we should be there to support them and bring more users to the ecosystem. Because if no one is talking about Runes and Ordinals, I think the yields in the Bitcoin ecosystem or DeFi will be very, very low because you can't create yields out of thin air, in my understanding.

The above is a personal note, for sharing only, and does not constitute investment advice. If there are any errors, please correct them. #merlin# #梅林# #BTC# #Ordinals#