Bitlayer is about to issue coin: the reaper's scythe or the dawn of BTCFi?

Written by: Oliver, Mars Finance

When a star project with the dazzling halo of being the "first Layer 2 based on BitVM" and having received investments from Wall Street giant Franklin Templeton—Bitlayer—officially announces that its token $BTR is about to have its TGE, the market sentiment is complex and divided. On one hand, there is the anticipation brought by top-tier capital endorsement and grand technological narratives; on the other hand, after experiencing the peak and subsequent fall from the inscription frenzy, along with countless "meme dog L2" projects in disarray, the entire market is permeated with fatigue and skepticism.

This raises a sharp question that everyone wants to know the answer to: Is Bitlayer issuing tokens at this moment to take advantage of the lingering warmth of the Bitcoin ecosystem to complete a beautiful "harvest", or does it really have the capability and capital to sound the charge for a new bull market in this seemingly dormant ecosystem?

To answer this question, we must go beyond the superficial noise, delve into its technical core, strategic blueprint, and even the thoughts of its co-founder Kevin He—a serial entrepreneur who has experienced multiple market cycles and created a hundred billion TVL ecosystem. His insights may provide us with crucial clues.

Bitlayer's three trump cards - technology, economic model, and execution capability.

Bitlayer is not a reckless speculative project; its core competitiveness is composed of three closely interconnected trump cards: solid technology, a clear economic model, and reliable execution.

Technical Ace: The Secure Narrative Based on BitVM Its core lies in the groundbreaking application of the BitVM paradigm, returning to the essence of security. Co-founder Kevin He pointed out that the essence of BitVM is based on Bitcoin's Optimistic Rollup (Optimistic Rollup), whose brilliance lies in the gradual shift of community consensus from the arduous attempts to build complex virtual machines on Bitcoin to a viable path of directly validating zero-knowledge proofs (ZK Proof). This means that challengers only need to validate a deterministic ZK proof on the Bitcoin mainnet to adjudicate fraudulent behavior. This shift significantly reduces the difficulty of implementation and brings two fundamental advantages: it can be realized based on existing technologies like Taproot without any upgrades to the Bitcoin protocol; at the same time, through on-chain verification, it firmly anchors the security of Layer 2 on top of the Bitcoin mainnet, breaking through the traditional dilemma between security and programmability in scaling solutions. As the industry's first team to explicitly develop bridges and Layer 2 based on BitVM, Bitlayer has reached strategic cooperation with mainstream mining pools such as AntPool and F2Pool, securing nearly 40% of Bitcoin's computing power support, which ensures that in the event of a fraudulent challenge, the challenged transaction can be prioritized for on-chain packaging—this is a core advantage that is difficult for other teams to achieve and is crucial for survival.

Economic Model Ace: Meticulously Designed $BTR Token Economics This not only reflects its strategic intent but also represents a clear path from "Market Dream Rate" to "Price-to-Earnings Ratio". The total supply of $BTR is fixed at 1 billion tokens, and its distribution strategy clearly focuses on the long-term construction and incentives of the ecosystem.

Massive ecological incentives: Up to 40% of the tokens are designated for ecological incentives. This is a huge "war fund" that indicates Bitlayer plans to invest substantial resources to guide and nurture its ecosystem in order to attract developers and users in the highly competitive L2 market.

Clear token utility: $BTR is endowed with multiple core functions, including staking to maintain network security, participating in on-chain governance decisions about the protocol's future, and a crucial fee switch mechanism. This mechanism may allocate a portion of the protocol's revenue in the future to reward stakers or buy back and burn, directly linking the token's value to the network's economic activity.

Execution Ace: An Experienced Team with Top Capital A grand vision ultimately requires a capable team to realize it. Kevin He's resume itself is a powerful letter of recommendation: he led a team to create a peak moment with a daily trading volume of four million transactions on the HECO ecosystem and a TVL surpassing ten billion dollars. This mature team of nearly sixty people, led by him, combined with endorsements from top capital such as Framework Ventures, ABCDE Capital, and Franklin Templeton, forms a solid foundation for Bitlayer to turn its blueprint into reality.

The Battlefield Under the Grand Narrative - The Real Temperature of the Bitcoin Ecosystem

Bitlayer's ambition needs to be tested on a real battlefield. This battlefield—the Bitcoin ecosystem—is currently in a "time of reflection" after a carnival, but it is far from silent. It presents a complex, multi-layered picture with ice and fire coexisting.

As Kevin He observed, there is a significant temperature difference in the perception of the ecological status between Eastern and Western markets. The Chinese community feels generally pessimistic after the tide receded due to their early high expectations for the inscription craze; meanwhile, the European and American markets remain relatively active. He believes that judging the temperature of BTC cannot simply apply the standards of Ethereum. The uniqueness of the BTC ecosystem lies in its massive financial activities, such as lending and derivatives trading, which have long existed off-chain. The real opportunity is to safely and efficiently migrate these trillions of dollars of off-chain activities on-chain. This is the vast ocean of BTCFi, and the current bottleneck is insufficient infrastructure.

Although the craze for inscriptions and runes has cooled down, it has left behind two valuable legacies as a successful "stress test": it validated the demand with real money, proving the market's immense desire to issue and trade assets on Bitcoin; at the same time, it exposed bottlenecks, making everyone realize that Layer 2 is a necessity for ecological development.

Therefore, during the market calm period, true builders have not stopped, and an intense "infrastructure competition" is quietly unfolding on multiple fronts.

At the protocol layer, innovation continues to deepen. After two years of waiting, the RGB protocol has finally launched on the mainnet, representing an exploratory direction for native smart contracts. The BRC 2.0 upgrade attempts to integrate EVM compatibility for the massive BRC-20 assets. In addition, native protocols like SAT 20, which have insisted on building for two years, have finally launched on the SatoshiNet mainnet.

The competition is equally fierce at the application and infrastructure layers. Various Layer 2 solutions are accelerating their delivery. In addition to Bitlayer, the Bitcoin bridge Fiamma, built on BitVM 2, has also gone live on the mainnet, joining the competition for trust-minimized cross-chain solutions. Meanwhile, native L2 solutions like Spark, which focus on payments and settlements, are also making continuous progress.

In terms of assets and markets, the ecosystem has not completely frozen. The established Bitcoin NFT series "NodeMonkes" has recently shown a strong recovery momentum. In the runes sector, although the leading $DOG has performed modestly, several runes have excelled over a longer time frame, and $DOG has successfully been listed on mainstream exchanges like Kraken, marking a gradual recognition of rune assets.

In conclusion, the current Bitcoin ecosystem is not in a state of silence, but has entered a stage of distilling the essence and honing internal skills. Bitlayer has entered the scene with its unique technical route and strong capital against the backdrop of this competitive era among builders.

Is it harvesting or dawn? The answer lies in the details of execution.

Now, we can answer the initial question more clearly. Is Bitlayer here to "harvest"? This risk is real. BitVM is a cutting-edge and extremely complex technology that faces huge technical execution risks. At the same time, with competitors like Merlin Chain aggressively seizing a large TVL through radical airdrops, market competition is exceptionally fierce.

However, the possibility of Bitlayer becoming the "new hope" is becoming increasingly clear. This hope is no longer based on a vague dream, but is built on a series of solid pillars:

Clear roadmap: It has a clear plan from market validation to secure implementation and then to building a high-frequency trading environment.

Pragmatic business model: It chooses to start from the essential needs of service agencies and users for income, rather than creating demand out of thin air.

Reliable leadership: It is steered by a seasoned leader, providing assurance for the project's execution.

The security philosophy that aligns with the spirit of Bitcoin: Its ultimate pursuit of minimal trust is most likely to earn the final trust of the Bitcoin core community and long-term holders.

The issuance of $BTR is not the end of the story, but the starting gun. That massive 40% ecological incentive fund will be the fuel for Bitlayer to achieve its three-phase roadmap. The final answer does not lie in the price of the coin at the moment of TGE, but in whether Bitlayer can steadily deliver on its technological promises and effectively use this "war fund" to cultivate a truly prosperous ecosystem that can transfer the off-chain value of Bitcoin onto the chain.

For us observers, Bitlayer's journey will be the best sample to measure whether the Bitcoin ecosystem can make the thrilling leap from "digital gold" to "programmable financial infrastructure."