Introduction

As Bitcoin hits new highs, let's explore a key factor driving renewed interest in the asset: Bitcoin L2s. Bitcoin, the oldest and most tested crypto, faces challenges with slow and costly transactions, especially during peak periods. Efforts like the Lightning Network aim to address this, but issues like user experience and liquidity have hindered its widespread adoption.With the recent surge of interest in building on Bitcoin following the Ordinals NFT launch in January 2023, there has been a revival in scaling efforts like Stacks and new initiatives adopting different approaches.

The growing Bitcoin Layer 2 (L2) landscape presents an exciting frontier in the crypto world.

Here are promising Bitcoin L2 projects to watch:

Bison Network - A zero-knowledge rollup solution enhancing transaction throughput and smart contract features around BTC.

Stacks - Unique integration of smart contracts on Bitcoin using Proof of Transfer (PoX) and upcoming Nakamoto upgrade.

BitVM - Introduces smart contracts on Bitcoin without altering its rules via hashlocks, timelocks, and large Taproot trees.

Botanix - Developed the Spiderchain design for two-way pegged sidechains with Bitcoin, interacting with the Ethereum Virtual Machine (EVM).

Chainway - Backed by Galaxy Digital and Delphi Ventures, working on zk-rollup solution Citrea for Bitcoin, leveraging BitVM.

Kasar Labs - Integrating Starknet's zk-rollup capabilities with Bitcoin and anchored rollups using data availability adapter.

Merlin Chain - L2 for scaling different Bitcoin-native protocols, launched mainnet and upcoming governance token $MERL.

Ark - Virtual transaction outputs (VTXO) for anonymous, offchain payments without liquidity management, reducing onchain footprint.

The Big Picture

Bitcoin's market cap exceeds $1.3 trillion, with a substantial amount of capital untapped due to scalability constraints. The rising Bitcoin L2 ecosystem addresses these limitations and gains momentum from projects like Ordinals and Ethereum’s layered architecture inspiration.

Conclusion:

This evolution, combined with institutional interest such as the first spot Bitcoin ETFs in the U.S., signals a potential surge in Bitcoin adoption. As Bitcoin transitions from a passive store of value to an active, programmable asset, it opens new paths for innovation and growth in the cryptoeconomy.