New Trends in Bitcoin Ecosystem Development: Layer 2 Projects Become the Focus of Attention

Recently, the Bitcoin ecosystem has witnessed a surge in inscription enthusiasm, which not only led to a significant increase in the prices of related tokens but also sparked thoughts on the future development direction of the Bitcoin network. As the issue of network congestion due to the surge in inscription transaction volume becomes increasingly prominent, "L2" development for Bitcoin has become a highly关注 trend. Layer 2 solutions can not only alleviate the pressure on the main network but also bring more programmability to the Bitcoin ecosystem, opening up possibilities for applications such as DeFi. So, what does the current development trend of the Bitcoin L2 track look like? What early projects are worth关注?

Challenges Facing the Bitcoin Network

The rise of inscription trading has put immense pressure on the Bitcoin network. Data shows that since February of this year, inscriptions have become the main consumers of Bitcoin block space, leading to the memory pool of the network being consistently full. A large number of small transactions are piling up, causing not only network congestion but also potentially generating a significant amount of "junk UTXO," which poses a long-term burden on the network.

This phenomenon has sparked intense discussions within the Bitcoin community. Some developers believe that inscription transactions are actually exploiting vulnerabilities in the Bitcoin protocol to send junk information to the blockchain. This viewpoint has raised concerns in the market about the prospects of inscription projects and has prompted people to think about how to achieve prosperous development of the ecosystem while maintaining the health of the Bitcoin network.

Advantages of Layer2 Solutions

In this context, the advantages of Layer2 solutions are gradually becoming apparent:

1. Alleviate mainnet pressure: By transferring transactions to the L2 network, the burden on the Bitcoin mainnet can be effectively reduced.

2. Improve trading efficiency: L2 networks usually have faster transaction speeds and lower fees.

3. Enhanced programmability: Some L2 solutions have introduced smart contract functionality, bringing more application possibilities to the Bitcoin ecosystem.

4. Maintain Security: Many L2 solutions still rely on the Bitcoin network for security.

Overview of Major Bitcoin L2 Projects

Stacks

Stacks, as an independent protocol layer, introduces Ethereum-like smart contract functionality while anchoring to the Bitcoin blockchain. It achieves cross-chain interoperability with Bitcoin through sBTC, but this centralized mapping approach carries certain risks. In addition, Stacks uses its own STX token as Gas, which may affect miners' participation enthusiasm.

RSK (Rootstock)

RSK is a smart contract platform compatible with Bitcoin, supporting the migration of Ethereum applications to the Bitcoin ecosystem. Its uniqueness lies in the adoption of a merged mining mechanism, allowing miners to provide computing power for both the Bitcoin and RSK networks, thereby increasing miners' profits. However, RSK uses smartBTC (RBTC) as a cross-chain token and still faces security risks associated with smart contracts.

BitVM

BitVM proposes a solution for implementing Turing-complete contracts without modifying the Bitcoin protocol. It minimizes on-chain activity through an innovative verification mechanism. However, BitVM is still in the conceptual stage, and its practical applications are limited. Its smart contracts run off-chain, and different contracts do not share state, which may limit its application scenarios.

BEVM

BEVM is an EVM-compatible Bitcoin L2 solution that uses BTC as the Gas fee. It achieves a 1:1 mapping of Bitcoin on the L2 network through an innovative cross-chain mechanism, while maintaining decentralization characteristics. The advantage of BEVM lies in its full compatibility with EVM, allowing for easy porting of DApps from the Ethereum ecosystem, bringing rich application scenarios to Bitcoin.

MAP Protocol

MAP Protocol is a Bitcoin L2 network focused on cross-chain interoperability. It not only offers lower transaction fees but also achieves cross-chain capabilities for BRC20 tokens. Users can conduct low-cost, high-efficiency inscription transactions on MAP Protocol and conveniently interoperate with the Bitcoin mainnet.

Outlook

With the growing recognition of the importance of Layer 2 solutions in the cryptocurrency community, the Bitcoin L2 track is expected to usher in new development opportunities. This field is still in its early stages and is likely to produce a batch of projects with enormous market value potential. For investors and developers, the Bitcoin L2 ecosystem is undoubtedly a blue ocean worth long-term follow.