Forward the Original Title ‘TVL 突破 2 亿美元：基于比特币再质押构建 AVS 网络，Pell Network 如何释放 BTCFi 万亿市场？’

2024 is shaping up to be a pivotal year for Bitcoin, with not only the approval of BTC ETFs but also the emergence of new applications like inscriptions, memes, and Layer 2 solutions, revealing a new ecological character for Bitcoin. Bitcoin holders are no longer limited to holding; they are increasingly engaging in staking, lending, and other on-chain DeFi activities. BTCFi is widely regarded as the most promising track for growth in this cycle. Consequently, optimizing the underlying infrastructure of the Bitcoin ecosystem and activating the trillion-dollar BTC assets lying dormant within it has become a key focus for BTCFi development.

In this context, Pell Network’s emergence is timely: as the first universal security network built on Bitcoin re-staking, Pell Network aims to help all AVS leverage Bitcoin’s powerful security foundation and drive BTCFi prosperity.

Since its pre-launch announcement, Pell Network has shown remarkable performance, with TVL surpassing $200 million in just three weeks and independent addresses reaching 410,000. The project has reportedly secured millions of dollars in funding.

The impressive growth data confirms the market’s tremendous enthusiasm for BTCFi and fuels deeper exploration by the community into Pell Network. With upcoming BNB Chain Campaigns, Bitlayer Carnival events, and the approaching testnet, Pell Network is expected to attract a broader range of community members in the foreseeable future.

Through data analysis, this article will delve into the tremendous growth prospects of BTCFi, the importance and necessity of AVS sharing Bitcoin’s robust security foundation, and the operational logic of the Pell Network project, providing insights into the future development potential of the project and the Bitcoin ecosystem.

BTC Enhanced EigenLayer: Pell Builds AVS Network Based on Bitcoin Re-staking

In simple terms, if you understand EigenLayer, you’ll easily grasp the basic principles of Pell Network.

We know that Ethereum transitioned from PoW to PoS, marking the beginning of Ethereum staking. EigenLayer, a re-staking protocol built on Ethereum, allows staked ETH on the Ethereum network to be re-staked to enhance network security. Active Verification Services (AVS) can leverage these staked assets to share Ethereum’s security foundation.

AVS aims to provide Web3 trust assurances for any computation. Often, AVS can be simply likened to “middleware,” existing in various forms such as data availability layers, shared sequencers, and oracle networks. EigenLayer enables AVS to better serve dApps like DeFi and gaming, while stakers earn additional contribution rewards. This process not only reduces the startup costs for new blockchain protocols but also enhances the overall network’s resistance to attacks and improves capital utilization efficiency.

In Pell Network: Users stake BTC assets, and these staked assets provide AVS with the strongest Bitcoin-based security. dApps requiring AVS services receive superior services, leading to more innovative and better-experienced products. All participants - AVS, node operators, Pell protocol, and users providing staked BTC - in this process benefit from rewards.

Unlike EigenLayer’s focus on the Ethereum ecosystem, Pell Network aims to build a cross-chain AVS network, extending Bitcoin’s top-notch security across the entire industry ecosystem. The core of this cross-chain vision is to bridge the gap between chains. Pell Network uses cross-chain atomic communication and ZK-Rollups to create a comprehensive cross-chain relay network, consolidating dispersed BTC and its LSD liquidity assets into a unified Pell Network ledger. This approach addresses the issues of BTC liquidity fragmentation and ecosystem isolation, facilitating a decentralized governance AVS service network and allowing Bitcoin to contribute to a broad range of decentralized applications.

As Bitcoin re-staking evolves, BTC also adopts a layered model, but no matter how complex the mechanisms become, users always hold a “voucher” tied to the principal amount. In addition to native BTC, Pell Network is dedicated to providing a “final destination” for all vouchers, integrating fragmented liquidity as much as possible and laying a solid foundation for a universal security layer supported by BTC.

Pell Network supports multiple asset staking options:

• Local Re-staking: Validators can re-stake their BTC by directing their withdrawal vouchers to Pell Network contracts.
• LSD Re-staking: LSD is deposited into Pell Network smart contracts.
• BTC LP Re-staking: Validators stake a pair of LP tokens that include BTC.
• LSD LP Re-staking: Validators stake a pair of LP tokens, including a liquid-staked BTC token.

Currently, Pell Network supports networks such as BNB Smart Chain, Bitlayer, MerlinChain, B² Network, BOB, Core DAO, and BEVM, and has established partnerships with protocols including Lorenzo Protocol, Solv Finance, FBTC, and MapProtocol. The full-chain landscape is beginning to take shape.

As aggregated liquidity forms a powerful force, Pell Network is committed to guiding these staked assets to empower the cross-chain AVS network.

Specifically, Pell Network’s ecosystem consists of three main roles: stakers, operators, and developers. Stakers can choose to directly stake their assets with Pell Network and run nodes or delegate to other agents. Delegated agents manage related validation nodes and collect fees, with stakers and agents earning rewards, while non-compliant agents and their stakers face penalties. Operators manage and run the AVS network, using BTC LSD to strengthen network security. Developers focus on designing and adjusting the penalty and reward mechanisms for decentralized systems to ensure secure and orderly network operation.

To ensure that Pell Network’s staked assets can support AVS to the greatest extent while alleviating concerns about whether anticipated revenues can cover operators’ costs and whether operators have sufficient computational resources for AVS validation, Pell Network employs a layered AVS design.

Specifically, Pell Network’s AVS is divided into two types:

Large-Scale AVS: The total computational workload of large-scale AVS is evenly distributed across all participating operator nodes. For example, in large-scale data availability protocols, data is divided into N blocks, with each block being 2/N the size of the original data. This distribution ensures that the total storage cost of the data is comparable to the cost of storing data with just two nodes. Consequently, while each node’s data processing requirements may be low, the entire system can achieve high throughput by aggregating the performance of multiple nodes, thereby enabling a higher degree of decentralization.

Lightweight AVS: Lightweight AVS is designed to address tasks that need to be repeated frequently but have very low costs, such as using lightweight clients to verify certain information or validate zero-knowledge proofs. These tasks have very low computational and infrastructure requirements, making them suitable for operation on Pell Network.

Based on this layered design, AVS can be built according to their capabilities and needs, ensuring that even individually operating validators can gain substantial economic benefits from Pell Network. Greater participation also effectively alleviates concerns about staking centralization. Currently, Pell Network has successfully attracted over seven well-known node operators to sign letters of intent. With the arrival of testnet activities, Pell Network is expected to attract even more node operators and AVS registrations.

In summary, Pell Network’s vision and solutions for building a full-chain ecosystem consensus layer by leveraging Bitcoin’s robust security have become clear. From product architecture design to ecosystem-wide benefits, Pell’s sophisticated design ensures the project holds a unique position in both re-staking and security sharing domains. This series of advantages is closely tied to Pell Network’s deep understanding of the ecosystem landscape.

The Uniqueness and Necessity of Pell: Truly Sharing Bitcoin’s Strongest Security Foundation

It is well known that security is the most fundamental guarantee for the establishment and prosperous development of an ecosystem. However, building a robust security foundation is no easy task for most projects and practitioners:

Some projects opt to build an entirely new trust network, but this method of reconstructing consensus mechanisms not only further fragments consensus but also involves high costs and long timelines to achieve greater decentralization. Other projects choose to build on mature blockchains such as L1 or L2 to share the security of these chains, but this approach also faces a series of issues, such as high development costs and the need to sacrifice some flexibility and autonomy to adhere to the chain’s governance rules.

As the pioneering force in the crypto industry, Bitcoin offers the most powerful security: it features a mature and stable consensus mechanism and enjoys the broadest adoption and recognition worldwide, with over $1.3 trillion in capital. The extensive adoption also increases the cost for attackers to control the network, further enhancing decentralization. If more projects can share Bitcoin’s unbreakable security foundation, developers can focus more on innovation and functional expansion, thereby further driving the prosperity of the on-chain ecosystem.

So, how can we unlock the immense value of this “strongest security”? In addressing this issue, Ethereum, often considered the “second security” in the crypto industry, has successfully provided a reference through its Eigenlayer concept, which empowers AVS (Active Verification Services). However, successful experiences are about learning rather than copying, and this applies to constructing a Bitcoin version of Eigenlayer:

On one hand, Eigenlayer’s approach, based on the Ethereum ecosystem, is more oriented towards serving the Ethereum ecosystem. For systems supporting non-Ethereum ecosystems, Eigenlayer faces challenges such as cross-chain staking, penalties, and governance.

On the other hand, if the goal is to share Bitcoin’s strongest security, using Bitcoin as the staking asset is undoubtedly the most natural choice. This choice enhances Bitcoin supporters’ recognition of the mechanism and avoids some of the risks associated with PoS chains, where the sudden drop in asset value can create opportunities for attackers. Bitcoin’s lower volatility compared to most PoS assets makes it a more attractive option for shared security solutions.

However, an important issue is that Bitcoin’s PoW consensus mechanism does not inherently have PoS yield capabilities. Previous yield solutions based on BTC, such as wrapping, CeDeFi, and cross-chain bridges, often involve trust assumptions. For instance, WBTC relies on a single trusted entity, and sidechains’ BTC often depend on multi-sig committees, which do not genuinely share Bitcoin’s security foundation.

The breakthrough came with the advent of Babylon: Babylon uses staked BTC to help secure PoS chains and validate transactions on those chains, while PoS chains provide security rewards to Babylon and BTC holders. This innovation achieves risk-free yields from native Bitcoin PoS, providing a solid foundation for Bitcoin-based shared security solutions. However, Babylon has limitations for building large-scale AVS and cannot be fully utilized for security by large-scale lightweight AVS, making it unsuitable as a universal AVS solution.

Babylon has transformed non-stakable BTC into stakable BTC, marking a significant shift from 0 to 1. But how can we enable the entire industry to share Bitcoin’s powerful security foundation and achieve explosive growth in BTCFi from 1 to 10, or even 100? Pell Network aims to create the first general-purpose security network based on Bitcoin re-staking, empowering industry-wide AVS with Bitcoin’s robust security foundation. With this solid base, users, AVS, the Bitcoin ecosystem, and the broader industry ecosystem will all benefit.

AVS Builds the Ecological Infrastructure, Accumulating Power to Unleash Potential in BTCFi Summer

The value of a healthy ecosystem lies in its ability to benefit all participants and, from a long-term perspective, to accumulate momentum for the industry’s development. Pell Network’s general-purpose security network, built on Bitcoin re-staking, is a prime example of this.

For users, the appeal of participating in Pell Network lies not only in earning rewards but also in actively contributing to the construction of the industry’s security foundation, which reveals more potential for benefits.

On one hand, by participating in Pell Network’s staking, users will receive reward points. These points not only recognize user participation but will also be closely linked to Pell Network’s future token airdrops, providing additional value to users.

On the other hand, stakers who contribute to building a strong security foundation enable AVS to offer higher-quality services, thereby driving safer and more efficient dApp operations. In this process, earnings from higher-level applications will be fed back to stakers through a certain mechanism. The success of a dApp will bring hidden substantial returns to users, and as dApp users and transactions grow, stakers’ earnings will increase accordingly.

For AVS, Pell Network offers a low-barrier and solid security foundation, allowing developers to focus more on business logic implementation without worrying about underlying security infrastructure.

More importantly, Pell Network implements cross-chain interoperability through its underlying design and technology. AVS can be deployed across multiple chains with a single development effort, making Pell Network a fertile ground for the emergence of various new AVS and enhancing the overall infrastructure of the entire chain ecosystem.

For example, Pell Network can rapidly build economically secure oracle networks. Developers do not need to invest considerable effort in creating a separate AVS layer but can focus on data processing and feeding. With Pell Network’s security infrastructure, oracle networks can operate more efficiently and reliably, ensuring data accuracy and timeliness.

Another example is utilizing Pell Network’s re-staking mechanism and community power to build a high-efficiency, low-cost large-scale data availability layer, providing robust data support for various dApps and ensuring data accessibility and integrity.

Furthermore, Pell Network’s messaging mechanism simplifies the creation of lightweight cross-chain bridges. Stakers can validate cross-chain signatures off-chain, and if a challenge event proves to be a real discrepancy, validators in Pell Network will be penalized in a slow mode (as opposed to optimistic mode). This mechanism effectively ensures the security and reliability of cross-chain operations.

Other potential AVS scenarios include ultra-low-latency application chains, privacy-focused DeFi protocols, blockchain games, Web3 AI applications, and RWA (Real-World Asset) tracks. Through these application scenarios, Pell Network aims to provide a more diverse and efficient range of services to the blockchain ecosystem, fostering industry development and innovation.

The various new types of Active Validation Services (AVS) emerging from Pell Network can further address the long-standing gaps in the Bitcoin ecosystem’s infrastructure, significantly advancing BTCFi’s development.

For the Bitcoin ecosystem, Pell Network’s cross-chain interoperability represents a major breakthrough. By seamlessly connecting with other blockchain networks, Bitcoin can flow more efficiently across different chains. BTC is no longer confined to a single chain’s application scenarios but can play a role in a broader blockchain ecosystem, achieving efficient asset allocation and utilization.

Additionally, Pell Network’s AVS network genuinely shares Bitcoin’s security foundation. This security enhancement not only increases users’ trust in the Bitcoin ecosystem but also creates a conducive environment for the development of Layer 2 solutions and dApps. Developers can focus on product innovation and further improvements in user experience, while higher-quality products and services will attract more new users. This positive feedback loop further drives the growth of the Bitcoin ecosystem.

Beyond the Bitcoin ecosystem, the full-chain nature of AVS offers significant benefits to developers in various other ecosystems. The security layer based on Bitcoin is stronger than any other security foundation. Pell Network’s implementation of full-chain sharing of Bitcoin’s security foundation creates a more reliable and efficient environment for industry developers. Developers can concentrate more on product innovation and user experience, enabling them to launch high-quality products more quickly and thus accelerate market responsiveness.

With the widespread adoption of AVS services, on-chain ecosystems will experience unprecedented prosperity. Developers can leverage a robust security foundation to build various innovative applications, which not only diversify the blockchain ecosystem but also attract more users and capital, accelerating the rapid development and maturation of the entire ecosystem.

How to Participate in the Pell Network, Presenting $300 Billion Growth Potential?

As an enhanced version of EigenLayer for BTC, Pell Network has immense development space and potential. Firstly, in terms of funding volume, Ethereum has about $400 billion, while Bitcoin’s funding volume reaches up to $1.5 trillion. Bitcoin’s long-standing dominance in the market indicates its greater potential for ecosystem expansion.

Further analysis shows that ETHFi is currently around $80 billion. If we extrapolate this proportionally, the BTCFi scale could potentially reach $300 billion. This massive anticipated market size not only highlights BTCFi’s enormous potential but also signals that Pell Network, as a significant force driving BTCFi’s prosperity, has rich opportunities and a vast market space.

It’s worth noting that while EigenLayer primarily focuses on the Ethereum ecosystem, Pell Network offers versatility and full-chain advantages. This means Pell Network can support a broader range of application scenarios from a full-chain perspective, giving it stronger potential for future development. Consequently, many community members believe that holding Pell Network tokens is expected to yield good returns.

So, how can you effectively accumulate Pell Network tokens?

Firstly, the most crucial aspect to seize is the points system.

At present, before the token launch, Pell Network’s ecosystem rewards are presented in the form of points. The Pell Points Program targets a TVL of $1 billion. During this period, users can earn basic points by completing tasks such as following Pell on Twitter, joining Discord and Telegram, making a first deposit exceeding 0.001 BTC, and staking more than 0.01 BTC for 14 consecutive days. Additionally, participating in the Bitlayer Mining Festival, staking in ecological partnership projects, and inviting friends can earn more points.

In the previous Bitlayer Mining Festival, Pell Network, as a collaborating project, offered rewards worth $3.75 million to users who participated and staked, including 30,000 Pell Points and 1.5x permanent points cards, attracting extensive community enthusiasm.

As part of the project’s regular marketing activities, points will not only be linked to future airdrops but also represent various ecological benefits. At this stage, acquiring more points is equivalent to holding more token stakes.

Moreover, two major incentive activities are currently underway in the Pell ecosystem, offering users substantial rewards.

One such activity is the “TRAIN LIKE A CHAMPION” event, organized by Pell Network in collaboration with BNB Chain and over 15 high-quality projects within its ecosystem:

This event celebrates the opening of the 2024 Summer Olympics and runs from July 24 to August 14, 2024. Participants can earn points by connecting their wallets, minting AI NFTs, and completing project tasks. The top 5,000 participants in the points ranking will have a chance to share a $250,000 prize pool. Additionally, users with over 500 points can enter a $100,000 lucky draw. The event has already attracted over 10,000 participants.

Specifically, participants are required to join Pell Network Discord#bnb-code Channel, enter the command “!bnb” to get the activity code, and then enter the activity code in the Pell page to complete the binding.

After binding the recommendation code, participants can earn event points and mint Pell Champion NFT by completing the task of staking at least 0.0001 BTCB (BounceBit), 0.0001 solvBTC (SolvBTC) and 0.0001 stBTC (Lorenzo) on Pell.

Click here to learn more about BNB Chain Campaigns

The second major event is the Yield Carnival, co-hosted by Pell Networkf, Bitlayer, and Bedrock. The event will run from July 25 to August 25, and users have two ways to participate:

First Option: Visit the Minting page on Bedrock, select the Bitlayer chain, and use WBTC/BTC to mint uniBTC. Then stake the uniBTC to Pell Network.

Second Option: Go to Pell’s Stake page, select the Bitlayer chain, and stake WBTC/BTC to Pell Network. Pell will collaborate with Bedrock to mint an equivalent amount of uniBTC and deposit it into Pell’s restaking Vault. After Babylon launches, Bedrock will stake BTC on Babylon for you, earning Babylon staking rewards.

Participants in this event will receive multiple rewards, including Bitlayer points, Bedrock diamonds, Pell points, and future Babylon staking rewards. Additionally, there will be a Giveaway on social media during the event, so interested users can follow Pell’s official Twitter for more information.

Click here to learn more about the Earnings Carnival event

The simultaneous execution of multiple activities aims to provide users with diverse rewards through a vibrant ecosystem and guide them to explore specific ecosystem features. Notably, according to the Pell Network’s official roadmap, the Pell testnet will launch in early August. At that time, Pell Network will open registration for AVS and introduce a series of incentive measures to encourage large-scale participation. Pell Network will also use this opportunity to test its applications and services, continuously improving and optimizing the project.

Beyond the testnet, Pell Network is steadily advancing towards more milestones:

In August, Pell Network will launch an ecosystem builder incentive program to encourage more developers to join and contribute. Additionally, it will establish an AVS Technical Committee and a Node Operator Management Committee to further develop the AVS network.

In September, the focus will shift to the mainnet launch and the release of the token economic model. This will also expand AVS coverage to areas such as AI, DePIN, and RWA.

In Q4 2024, Pell Network will work on enhancing the decentralization and modularity of Pell, integrating with Babylon’s timestamp service and native BTC staking functions.

Conclusion

For a long time, BTCFi users have held large amounts of Bitcoin, but due to a lack of efficient utilization channels like those in Ethereum, much of the Bitcoin remains in cold wallets. This has meant that the BTCFi sector has yet to be fully developed into a widely accepted consensus.

Given this, if Bitcoin’s underlying infrastructure can be better utilized to provide yields while ensuring the security of the underlying assets, BTCFi is poised for explosive growth, potentially surpassing the historic highs of the Ethereum ecosystem.

Positioned in this trillion-dollar market, Pell Network’s solution is not limited to building a specific product but aims to establish a decentralized trustless market. On one hand, it offers diverse rights options and restaking mechanisms, enhancing the economic and security utility of the Bitcoin network. On the other hand, it supports the development of both lightweight and large-scale decentralized components, providing cost-effective solutions for infrastructure and application security in the Bitcoin ecosystem. This drives exponential growth in the Bitcoin ecosystem while allowing the entire industry to share Bitcoin’s security foundation through Pell Network’s AVS network, further unlocking the potential for on-chain innovation.

Although Pell Network’s mainnet has not yet launched and its future performance remains to be fully validated, the pre-launch achievements—such as a TVL surpassing $190 million and 360,000 unique addresses in just three weeks—demonstrate a significant market presence. With ongoing testnet activities, multi-chain expansion, and BNB Chain campaigns, we look forward to seeing more impressive developments from Pell Network in the future.

Disclaimer：

1. This article is reprinted from TechFlow]. Forward the Original Title ‘TVL 突破 2 亿美元：基于比特币再质押构建 AVS 网络，Pell Network 如何释放 BTCFi 万亿市场？’. All copyrights belong to the original author [TechFlow*]. If there are objections to this reprint, please contact the Gate Learn team, and they will handle it promptly.
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