What is Bitlayer (BTR)?

Deep Dive

1. Purpose & Value Proposition

Bitlayer aims to unlock Bitcoin’s $1.3 trillion market cap for DeFi by solving its programmability limitations. It transforms BTC from a passive asset into a productive one through:
- BitVM Bridge: Converts BTC into YBTC, a yield-bearing asset usable in DeFi protocols.
- Cross-Chain Composability: Integrates with Ethereum, Solana, and others via partnerships (e.g., Sui, Arbitrum).
- Institutional Backing: Supported by Franklin Templeton, Polychain Capital, and major Bitcoin mining pools (Antpool, F2Pool).

2. Technology & Architecture

• BitVM Framework: Allows Turing-complete smart contracts via optimistic rollups, verified on Bitcoin’s base layer.
• Bitcoin Rollup: Processes transactions off-chain, anchored to Bitcoin for security.
• Trust-Minimized Bridging: Users lock BTC to mint YBTC, redeemable via cryptographic proofs (no centralized custody).

3. Tokenomics & Governance

• Supply: 1 billion BTR total, with 26.16% circulating at launch.
• Key Allocations:
  
  • 40% to ecosystem incentives (grants, liquidity mining).
  • 20.25% to investors (6-month cliff, 24-month vesting).
  • 12% to core team (24-month cliff, 48-month vesting).
• Utility: Staking for network security, governance voting, and fee redistribution via the “Fee Switch” mechanism.

Conclusion

Bitlayer positions itself as Bitcoin’s DeFi execution layer, combining Bitcoin’s security with Ethereum-like flexibility through BitVM. Its success hinges on adoption of YBTC and developer activity via initiatives like the $50M Ready Player One grants program. Can Bitlayer overcome Bitcoin’s historical scalability constraints to become the go-to L2 for BTCFi?