Top 10 Projects in the Bitcoin Economy

Introduction

The Bitcoin economy is looking strong with several positive indicators, such as the Bitcoin ETF having the most volume of all assets on the NYSE, the Bitcoin halving, an early crypto bull market, and innovative developments like Ordinals. These factors make it hard not to feel optimistic about Bitcoin's future. However, for Bitcoin to truly become a significant global asset, it will need a vibrant ecosystem of financial applications built around it. This includes projects that enhance Bitcoin's functionality, making it more than just an asset to buy and hold.

Ordiswap

Ordiswap is a DEX that operates directly on Bitcoin's native layer, utilizing the BRC-20 standard and Ordinals to facilitate decentralized trading and liquidity provision. This platform represents a significant advancement in decentralized finance (DeFi) for the Bitcoin ecosystem, aiming to overcome limitations like bad user experience, high slippage, illiquidity, and inefficient transactions that have previously overshadowed Bitcoin DeFi initiatives

The core features of Ordiswap include a modular architecture comprising Swap, Liquidity, Indexing, and Oracle modules. These components work together to facilitate token exchanges, allow users to contribute to liquidity pools, optimize data access for faster queries, and provide accurate pricing information. Its Automated Market Making framework, dubbed osAMM, operates on Bitcoin's layer 1, making it the first of its kind. This off-chain server management allows for trustless exchanges of various tokens directly on Bitcoin’s native layer, employing off-chain balance states for scalability, security, and privacy of transactions​​​​​​.

Ordiswap uses a token called ORDS, an interoperable utility token designed to operate on both the Bitcoin base layer and the Ethereum network. The ORDS token is used for voting, governance, fee payments, and liquidity provision on Ordiswap. With a total supply of 1,000,000 ORDS, the token distribution is planned across various stages including initial liquidity pool, team and advisors, community and ecosystem, staking rewards, treasury, public sale, private sale, and a seed round.

Babylon Chain

Babylon Chain is an innovative platform aiming to enhance the DeFi landscape by integrating Bitcoin's robust security framework. It introduces a unique Bitcoin Staking Protocol that enables Bitcoin owners to generate yield on their BTC securely, without relinquishing control or using third-party services. This approach emphasizes user sovereignty and maximizes liquidity, allowing participation in multiple PoS blockchains through a trustless, self-custodial method that avoids the complexities of bridging or wrapping Bitcoin​​.

The platform's shared security protocol is designed to eliminate risks associated with integrating Bitcoin into other chains, maintaining Bitcoin's security and integrity while offering a seamless extension to various PoS chains.

Babylon Chain has garnered notable integrations within its ecosystem, including partnerships with Archway, Osmosis, Akash Network, and more, demonstrating its adaptability and the broad applicability of its security model​​. The protocol's innovative approach utilizes advanced cryptography and consensus mechanisms to lock Bitcoin in contracts on its blockchain, directly slashing for PoS chain violations, which ensures security and liquidity for stakeholders without the need for bridging, thus avoiding security vulnerabilities associated with third-party custodies​​.

Babylon chain has raised an $18 million funding round led by Polychain Capital and Hack VC​​, but have not yet launched token, this could be a great airdrop oppertunity.

Botanix

Botanix is a decentralized Layer 2 solution that builds on the strengths of both Bitcoin and Ethereum. It combines the security of Bitcoin's Proof of Work with the flexibility and functionality of Ethereum's Virtual Machine.

At its core, Botanix uses two primary components to operate. The first is the Ethereum Virtual Machine, which is fortified by a Proof of Stake consensus protocol. This protocol leverages Bitcoin's PoW for enhanced security, with stakes represented by actual Bitcoin stored within multi-signature wallets on the Bitcoin network. The second component is the Spiderchain, a dynamic network of multisigs that secures the actual Bitcoin on Botanix. This network is designed to be permissionless, allowing any participant to join, which contributes to the platform's decentralization​​.

One of the innovative features of Botanix is its approach to security, particularly through the concept of forward security. This concept, originating from encryption, protects users' assets even if a malicious party gains a majority of the stake. Additionally, the Spiderchain introduces decentralized multisigs that use Bitcoin staking to secure the network, safeguarding all Bitcoin on Botanix​​.

Botanix has yet to launch a token, he project is still in development, with a testnet available for those interested in exploring its capabilities further​​​​. This testnet could be a potential to be an early contributor and get rewarded if they launch a token.

Build on Bitcoin

BOB, short for Build on Bitcoin, represents a pioneering initiative in the Bitcoin ecosystem. It is the first Layer 2 (L2) solution with full Ethereum Virtual Machine (EVM) compatibility and native Bitcoin support. This groundbreaking platform empowers developers and innovators to build and innovate directly on Bitcoin, leveraging the robust security and widespread adoption of Bitcoin while utilizing the flexibility and advanced features of the EVM.

At its core, BOB integrates the Ethereum Virtual Machine, enabling the creation and execution of smart contracts on the Bitcoin network. This ensures compatibility with a wide range of developer tools, wallets, block explorers, and data analytics infrastructure. By leveraging the EVM, BOB facilitates DeFi applications and a variety of innovations across Bitcoin use cases.

One of the key features of BOB is its rollup functionality, which is secured by the Bitcoin network yet natively connected to Ethereum. This unique combination offers best-in-class security and accessibility, making it easy for Ethereum users, applications, and exchanges to interact with Bitcoin-based projects.

BOB's roadmap indicates a strong commitment to building and action, with future phases including enhancements like optimistic and ZK rollups. There currently is no token live for BOB but interacting with the chain could yield one in the future.

Runes Protocol

The Runes Protocol is a novel addition to the Bitcoin ecosystem, offering a fresh approach to fungible tokens. Unlike traditional protocols like BRC-20 and ORC-20, Runes utilizes a UTXO (Unspent Transaction Output)-based model, making it distinctive within the Bitcoin network. This model is fundamental to Bitcoin, tracking ownership and transactions in a decentralized manner. Runes simplifies the creation and management of tokens by allowing multiple tokens to be stored in a single UTXO, which could enhance efficiency compared to address-based or off-chain protocols.

Runes works with Bitcoin's existing system, where each transaction can include a certain amount of runes, fitting perfectly into Bitcoin's way of recording transactions. It uses a special kind of transaction, marked by a specific code (OP_RETURN), followed by details unique to Runes. This setup keeps rune transactions clear and correct on the Bitcoin network. When you want to move runes from one place to another, the transaction includes a set of instructions. These instructions detail which rune you're moving, where it's going, and how much of it you're sending. This approach makes sure runes are distributed clearly and efficiently. To create new runes, there's a special transaction that sets out the rune's name and how it can be divided, giving it a unique ID if it's a new name.

To learn more about participating in the Runes Protocol and future airdrop read all about it here and here.

Merlin chain

Merlin Chain is presented as a Layer 2solution built on Bitcoin, aiming to unleash Bitcoin's potential by integrating native Layer 1 assets, users, and protocols. This platform is designed to bridge the gap between Bitcoin's robust security and the need for more scalable and flexible blockchain solutions.

Merlin Chain stands out by offering low fees and high scalability, thanks to its compatibility with the Ethereum Virtual Machine (EVM). This ensures swift transaction processing and enhances liquidity, making it an attractive platform for developers and users alike. It supports a wide range of Bitcoin protocols, including BRC20, BRC420, Bitmap, Atomicals, Pipe, Stamp, and more, significantly expanding the possibilities for user interaction on Bitcoin's Layer 2.

A key feature of Merlin Chain is its implementation of ZK-Rollup technology. This enhances the efficiency and scalability of transactions by allowing sequencer nodes to manage data transmission through decentralized oracles. This setup ensures both transparency and security, maintaining the integrity of the Bitcoin network while enabling higher throughput.

Merlin Chain emphasizes community-driven innovation and fair launches, promising unique solutions tailored for the Bitcoin network and its users. Merlin chain have yet to launch a token, but as a layer 2 solution they most likely will in the future. Interact and use the chain and u might get rewarded in the future.

Dovi

Dovi is a community-driven Layer 2 solution on Bitcoin, designed to enhance the scalability, reduce fees, and foster a more secure and decentralized financial ecosystem. It is an EVM-compatible smart contract platform, aiming to bring the flexibility and innovation of Ethereum's smart contracts to the Bitcoin network.

Dovi focuses on several key advantages to improve the Bitcoin ecosystem:

• Efficient Transaction Processing: It aims to significantly reduce network fees and enhance transaction speeds.
• Safer Consensus Mechanism: By implementing a scalable second-layer network, Dovi enhances the security and efficiency of transactions.
• Privacy and Efficiency: Integration of Schnorr Signatures enhances Bitcoin's security with decentralized multi-signature transactions, making them more efficient and discreet.
• Multi-Asset Support: Dovi supports various asset types, including BRC20 and ARC20 tokens, enabling fast and secure cross-chain asset transfers.
• Smart Contracts and DeFi: With EVM compatibility, Dovi allows the deployment of Ethereum-designed smart contracts on the Bitcoin network, supporting a wide range of DeFi applications.
• Client-Side Verification and Off-Chain Scalability: Enhances transaction privacy through client-side verification and improves scalability by reducing the load on the main chain.

Dovi's immediate plans include releasing a testnet, establishing a developer community, and providing ecosystem support. Currently, Dovi have setup a points program for the launch of their token. The launch of Dovi V1 will mark a significant milestone in its development, signaling the platform's readiness for broader use and application in the DeFi space.

Bioniq

Bioniq is a novel marketplace for Bitcoin Ordinals, uniquely operating on the Internet Computer (ICP) blockchain, rather than directly on Bitcoin. This innovative approach positions ICP as a layer-2 network for Bitcoin, aiming to offer a faster, less costly, and the "world's fastest" trading experience for Bitcoin Ordinals without imposing network transaction or gas fees on traders. Bioniq facilitates the trading of Bitcoin-based Ordinals inscriptions by leveraging ICP's native Bitcoin integration.

The platform introduces a token wrapping process where users transfer their Bitcoin and Ordinals assets to Bioniq's wallet, then "wrap" these assets, creating a corresponding NFT on the ICP network. This process aims to alleviate network congestion and reduce fees associated with the burgeoning market of Bitcoin Ordinals and BRC-20 tokens. Bioniq has been highlighted for its potential to alleviate Bitcoin network congestion by tapping into the ICP, leveraging its smart contract capabilities and optimized storage costs.

Bioniq's smart wallet allows users to manage their private keys using Web3Auth, enabling logins via conventional Web2 Google accounts while maintaining non-custodial control of wallets and assets. The platform's architecture is designed to claim transaction finality times below two seconds and zero gas or network fees, providing a cost-effective and speedy trading environment.

Despite the advantages Bioniq claims, the process of transferring and wrapping assets on a different blockchain might introduce complexity and potential risks related to the stability and security of the ICP network. Future plans for Bioniq include developing a launchpad for new collections, a crypto borrowing system using Ordinals assets as collateral.

StackingDAO

StackingDAO is a relatively new project that brings capital efficiency to $STX stakers. It does this through a relatively new innovation in crypto called Liquid Staking. Through this, stakers can enjoy both the staking rewards while also being able to continue using their assets in DeFi instead of having the assets locked inside a staking contract. With StackingDAO, this means that you stake your STX tokens in their protocol, receive stSTX in return that keeps earning that sweet Bitcoin yield while you can still use the stSTX in other Stacks DeFi dapps.

The platform operates by charging a 5% commission on Stacking yields, which are used in the short term to build liquidity for stSTX-STX on Automated Market Makers (AMMs). In the long term, StackingDAO aims to invest in strengthening the Stacks blockchain infrastructure. This approach positions StackingDAO as a non-custodial, tokenized, and autocompounding solution in contrast to existing custodial and community Stacking pools, which do not offer tokenized representations or auto-compounding features. The approach and technologies behind StackingDAO have been made possible recently, thanks to updates that enable continuous Stacking through Stacks smart contracts. This development is timely, especially considering the anticipated increase in demand for delegated Stacking solutions with the 2024 Stacks Nakamoto upgrade.

So far, there's no information yet on whether the project will have its own token, but have launched their own points program. However, most liquid staking protocols on other blockchains like Lido, Stride, and Benqi do have a native token that comes with governance and in some cases even a revenue-sharing mechanism.

ZeroSync

ZeroSync is at the forefront of integrating proof systems into the Bitcoin ecosystem, leveraging advanced cryptography to pioneer improvements in Bitcoin's privacy, interoperability, and scalability. It focuses on applying succinct zero-knowledge proofs (ZKPs), a technology promising significant advancements in blockchain scalability and privacy. While Ethereum has seen considerable efforts in this direction, Bitcoin has lagged behind, prompting ZeroSync's initiative to bridge this gap.

ZeroSync introduces a = compression technique through succinct zero-knowledge proofs. These proofs allow for the compression of hundreds of gigabytes of blockchain history into a compact proof. Once generated, this proof enables any number of nodes in the network to instantly sync with the blockchain, regardless of its growing size. This system not only enhances scalability and privacy but also maintains Bitcoin's hallmark of immutability by allowing the blockchain to be compressed and augmented with additional data structures, such as a UTXO set commitment, without necessitating consensus changes.

ZeroSync's mission is to catalyze the adoption of proof systems within the Bitcoin ecosystem, aiming to improve scalability, accessibility, and privacy. Its main activities include:

• Creating a proof system for instant Bitcoin chain state synchronization.
• Developing a toolkit for developers to incorporate ZKPs into existing protocols, applications, and services.
• Building a community around Bitcoin proofs and working towards integrating a ZKP verifier into Bitcoin's main layer.

Conclusion

The landscape of Bitcoin's ecosystem is rapidly evolving, marked by the emergence of projects that extend its utility beyond a mere store of value. These initiatives, ranging from decentralized exchanges and staking protocols to Layer 2 solutions and innovative proof systems, are laying the groundwork for a more accessible, secure, and versatile Bitcoin network. As these projects continue to develop and mature, they not only promise to enhance the functionality of Bitcoin but also to solidify its position as a foundational asset in the broader digital economy. The future of Bitcoin looks promising, with its ecosystem expanding to include a rich tapestry of applications that cater to a wide array of financial activities and services.