When Bitcoin prices rise, it triggers a “rising tide lifts all boats” effect—investors develop a keen interest in various projects and applications within the Bitcoin ecosystem. This positive cycle of improved liquidity and rising Bitcoin prices will lay a solid foundation for the prosperity of the Bitcoin ecosystem.

Looking back at last year’s surge, the excitement around Ordinals and the wealth effect from inscriptions shifted market focus towards the Bitcoin ecosystem. As the market gradually recovers, this article will explore potential new token projects within the Bitcoin ecosystem, helping you seize new opportunities in the bull market.

Project Overview

Layer 2 Mainnets

1. Bitlayer
   • Total Funding: $16 million
   • Investors: Framework Ventures, OKX Ventures, etc.
   • Description: The first Layer 2 network based on BitVM, aiming to become the computational layer for Bitcoin. It offers enhanced scalability while inheriting Bitcoin’s Layer 1 security, providing high throughput and low-cost transactions.
2. BOB (Build on Bitcoin)
   • Total Funding: $11.6 million
   • Investors: Castle Island, Bankless Ventures, etc.
   • Description: A hybrid Layer 2 combining Bitcoin’s security with Ethereum’s smart contract flexibility. It supports Bitcoin ecosystem components like Ordinals, Lightning, and Nostr.
3. B² Network
   • Total Funding: Undisclosed
   • Investors: HashKey Capital, OKX Ventures, etc.
   • Description: A Bitcoin Layer 2 solution based on zero-knowledge proofs, aiming to enhance transaction speed and application diversity while ensuring security. It supports Turing-complete smart contracts.
4. BEVM
   • Total Funding: Undisclosed
   • Investors: Skyland Ventures, Waterdrip Capital, etc.
   • Description: A fully decentralized Bitcoin Layer 2 solution compatible with the Ethereum Virtual Machine (EVM), designed to extend Bitcoin’s smart contract capabilities and use native Bitcoin (BTC) for gas fees.
5. Rollux
   • Total Funding: Undisclosed
   • Investors: Dewhales Capital, etc.
   • Description: An EVM-compatible Optimistic Rollup platform based on Bitcoin, aimed at enhancing Bitcoin’s scalability and smart contract functionality. It provides a secure and low-cost environment for decentralized applications.

Layer 2 Testnets

1. Babylon
   • Total Funding: $96 million
   • Investors: Paradigm, Polychain, Binance Labs, etc.
   • Description: A Bitcoin staking protocol allowing users to lock Bitcoin in the network to secure other POS chains while earning staking rewards.
2. Mezo
   • Total Funding: $28.5 million
   • Investors: Pantera Capital, Ledger Cathay Capital, etc.
   • Description: An EVM-compatible Bitcoin economic layer aimed at fostering a Bitcoin-based economy through applications that promote Bitcoin token usage, beyond just a “savings technology.”
3. Botanix
   • Total Funding: $11.5 million
   • Investors: Polychain, ABCDE Capital, etc.
   • Description: A decentralized, Turing-complete Layer 2 EVM built on Bitcoin, combining Bitcoin’s security with the usability of EVM, featuring Ethereum Virtual Machine (EVM) and Spiderchain as core components.
4. Nubit
   • Total Funding: $11 million
   • Investors: Polychain, OKX Ventures, etc.
   • Description: The first Bitcoin Data Availability (DA) Layer, designed to efficiently expand Bitcoin’s data capacity and support applications like Ordinals, Layer 2 solutions, and oracles, enhancing the Bitcoin ecosystem’s scope and efficiency.
5. Arch Network
   • Total Funding: $7 million
   • Investors: Multicoin Capital, OKX Ventures, etc.
   • Description: A Bitcoin Layer 2 solution using Rust-based zero-knowledge virtual machine ArchVM, combined with a decentralized validator network to provide an efficient and scalable application environment.
6. Bitfinity Network
   • Total Funding: $7 million
   • Investors: Polychain, ParaFi Capital, etc.
   • Description: An EVM-compatible Bitcoin Layer 2 network using Solidity and leveraging IC’s unique architecture and Chain Key technology, offering storage and processing speeds comparable to traditional networks without gas fees.
7. Zulu Network
   • Total Funding: $3 million
   • Investors: Waterdrip Capital, Cryptogram Venture, etc.
   • Description: A Bitcoin Layer 2 network with a unique dual-layer architecture to expand Bitcoin’s functionalities. It achieves EVM compatibility through ZuluPrime (L2) and provides additional security guarantees with ZuluNexus (L3).
8. Citrea
   • Total Funding: $2.7 million
   • Investors: Galaxy, Delphi Digital, etc.
   • Description: The first zero-knowledge proof-based Layer 2 in the Bitcoin ecosystem, featuring a unique bidirectional pegging architecture to create the first general trust-minimized Bitcoin Layer 2 solution, offering enhanced programmability and application scenarios.
9. Fractal Bitcoin
   • Total Funding: Undisclosed
   • Developers: UniSat and Block Space Force
   • Description: A Layer 2 scaling solution based on Bitcoin’s core code, designed to enhance Bitcoin’s transaction processing capacity and speed by recursively creating infinite layers, while maintaining full compatibility with the Bitcoin main chain.

L2 Pre-Testnets

1. Lorenzo Protocol

• Total Funding: Undisclosed
• Investors: Binance Labs, etc.
• Description: A decentralized liquidity staking platform based on Babylon, aimed at providing secure and convenient Bitcoin staking services. The protocol allows users to stake Bitcoin and receive liquidity-staking tokens through a liquidity financial layer.

1. QED Protocol

• Total Funding: $9 million
• Investors: Blockchain Capital, Arrington Capital, etc.
• Description: A zk-native execution layer for Bitcoin, focusing on zero-knowledge proof verification technology. It supports decentralized exchanges, DeFi, and other applications on Bitcoin through Taproot upgrades, promising high-speed transactions and global state access.

1. GOAT Network

• Total Funding: $5 million
• Investors: Metis Foundation, etc.
• Description: The first Bitcoin Layer 2 solution that shares ownership and mining rewards through a decentralized sequencer. It introduces unique OP technology to expand the Bitcoin network via Bitcoin Rollup.

1. Nexio

• Total Funding: $2.2 million
• Investors: Lattice Capital, HTX Ventures, etc.
• Description: An innovative Bitcoin scaling solution utilizing parallelized Rollup technology, aiming to support over 30,000 transactions per second while keeping fees below $0.01.

DeFi Mainnets

SolvProtocol

• Total Funding: $10 million
• Investors: Binance Labs, The Spartan Group, etc.
• Description: An omnichain yield protocol providing coin-based asset income services. Users can deposit BTC into Solv Protocol to receive Solvbtc.

DeFi Testnets

1. BitSmiley

• Total Funding: Undisclosed
• Investors: ABCDE Capital, OKX Ventures, etc.
• Description: A stablecoin lending protocol based on the Bitcoin ecosystem, combining over-collateralized stablecoin protocols, trustless lending protocols, and derivatives protocols to meet the need for stablecoins and lending infrastructure in the Bitcoin ecosystem.

1. Chakra

• Total Funding: Undisclosed
• Investors: ABCDE Capital, Bixin Ventures, etc.
• Description: A Bitcoin re-staking protocol driven by zero-knowledge proofs, utilizing ZK-STARKs technology and middleware chains to address trust issues with intermediaries. It collaborates with the data availability layer Nubit to modularly enhance the Bitcoin ecosystem.

DeFi Pre-Testnets

Lombard

• Total Funding: $16 million
• Investors: Polychain, OKX Ventures, etc.
• Description: A Bitcoin re-staking protocol that facilitates cross-chain movement of yield-generating Bitcoin without dispersing liquidity, advancing the Bitcoin staking ecosystem.

RGB + Lightning Network Mainnets

BiHelix

• Total Funding: Undisclosed
• Investors: Waterdrip Capital, LK Venture, UTXO, Satoshi Labs, etc.
• Description: A Bitcoin ecosystem infrastructure based on the native Bitcoin blockchain, combining RGB protocol and Lightning Network to optimize nodes. The project aims to lower development barriers and extend Bitcoin’s use cases.

RGB++ Pre-Testnets

UTXO Stack

• Total Funding: Undisclosed
• Investors: ABCDE Capital, OKX Ventures, etc.
• Description: A Bitcoin Layer 2 issuance platform based on the UTXO model, natively integrating RGB++ protocol capabilities, aimed at helping developers quickly deploy applications based on the UTXO architecture.

L3 Mainnets

U Protocol

• Total Funding: Undisclosed
• Investors: Alfa DAO, YAM DAO, etc.
• Description: The first BitcoinFi modular Layer 3 infrastructure, providing functions like uBTC and U Bitcoin Thunder Network, dedicated to enhancing Bitcoin’s liquidity and application scenarios.

Summary

Looking at the bigger picture, Bitcoin’s (BTC) value proposition has matured over the past decade, and its role as a store of value is now widely acknowledged. Regulatory changes, the introduction of ETFs, and macroeconomic factors like interest rate cuts have significantly influenced its market performance, suggesting that Bitcoin is increasingly becoming a key asset in institutional portfolios.

As Bitcoin’s value-storage function gains broader societal acceptance, we can expect a growing array of financial products and innovations built around it. While Layer 2 scalability issues and challenges with the UTXO model remain, the Bitcoin sector is set to continue evolving and improving. This progress is both an industry imperative and a sign of broader societal advancement.

Risk Warning: Cryptocurrency investments are highly speculative. The information provided is for informational purposes only and does not constitute investment advice.

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