Bitcoin is the most secure and decentralized blockchain network, but there are performance limitations such as not supporting smart contracts, only processing about 7 transactions per second, and transaction confirmation may be as high as tens of minutes. On January 30, the NFT protocol "Ordinals" was launched on the Bitcoin mainnet, and as of March 2,Number of NFTs on OrdinalsAlready more than 250,000.

Although this move has caused a lot of controversy, "Bitcoin fundamentalism" believes that the Bitcoin network should be kept as simple and stable as possible, but "Bitcoin extenders" hope to bring more financial use cases to Bitcoin. Either way, the advent of Ordinals sparked another wave of app development on top of Bitcoin. In this article, PANews will take stock of the recent development of common Bitcoin scaling solutions.

Stacks

Stacks adopts a pyramid-shaped stack. The bottom layer is the basic settlement layer of Bitcoin, then Stacks that adds smart contracts and programmability, and the top layer is Hiro that increases scalability and speed. It uses its own smart contract language, Clarity, and writes historical transaction records into the Bitcoin network, so Stacks is a Layer 2 of Bitcoin (Stacks also called itself Layer 1 before). Stacks issues its own token $STX. As a representative of Bitcoin smart contracts, $STX is also one of the best-performing assets recently.

Since the current applications built on Stacks are still mainly Arkadiko Protocol, ALEX, Stackswap, CityCoins, and STX NFT, there is no change from PANews’ statistics a year ago, so I won’t repeat them here.

According to the data of Defi Llama, the funds on Stacks have indeed increased significantly recently. In the past 30 days (February 1st to March 2nd), TVL rose from US$7.56 million to US$26.8 million, an increase of 254%. Among them, DEX ALEX has seen the most growth. Its TVL has increased by 316% in the past month, and the price of $ALEX has also risen from $0.015 on February 1 to $0.098 now.

Rootstock/RIF

Rootstock (RSK) is an EVM-compatible sidechain on Bitcoin. It uses the same SHA-256 algorithm as Bitcoin. Bitcoin miners can perform "Merged Mining" when mining. Additional resource consumption is required, and at the same time, the transaction fee income in Rootstock can be obtained. The native token in Rootstock is Smart BTC (RBTC), a bitcoin-pegged coin, which is also used to pay transaction fees.

RIF (Rootstock Infrastructure, RIF) is a platform built on Rootstock, which aims to provide developers with blockchain infrastructure and services, including domain names, storage, authentication, etc., to support the development and deployment of dApps. Although Rootstock does not issue other tokens other than RBTC, Rootstock and RIF are developed by the same company, IOV Labs, and RIF issues its own token $RIF.

As can be seen from Defi Llama, Rootstock’s TVL is $56.51 million, but the recent growth is not obvious, up 3% in the past 30 days. There are projects in the ecology including DEX, loan agreement, stable currency, etc., and cross-chain assets from other chains such as Ethereum can also be used. But even if Rootstock supports EVM, the funds in the ecological projects have not increased significantly in the past 30 days. The most increased is DEX Sovryn. The current TVL is 20.24 million US dollars, an increase of 18.31% in the past month.

Liquid Network

Liquid NetworkIt is a side chain technology (also known as Layer 2) launched by Blockstream in September 2018, which aims to provide Bitcoin users with a faster and more convenient transaction experience while ensuring transaction security and privacy. It is maintained and governed by the Liquid Joint Council, which includes exchanges, financial institutions, and other Bitcoin-focused companies.

In addition to fast, cheap, and private transfer functions, Liquid Network can also implement various types of smart contract functions, such as building DeFi applications (DEX Sideswap, lending platform Hodl Hodl, etc.), issuing stable coins, issuing security tokens, and minting NFTs , Multi-signature transactions, etc.

L-BTC issued on the Liquid Network is still anchored by Bitcoin 1: 1. The official website of Liquid shows that the circulation of L-BTC on the network has remained stable recently, currently at 3,551 pieces. The data for January and February are respectively 3567 and 3562 pieces.

Lightning Network

Bitcoin Lightning Network(Lightning Network) is a Bitcoin Layer 2 protocol that improves Bitcoin transaction speed and privacy by establishing payment channels between transaction parties.

according to

according to1 MLAccording to the data, the current funds in the lightning network are 5424 BTC, an increase of 2.2% in the past 30 days, the number of nodes is 16291, and the number of channels is 76297.

Statechains

Statechains, a scaling technology for off-chain transfers of BTC, are similar to, but not identical to, the Lightning Network. In the Lightning Network, the transfer of assets is through the ownership of the channel, but in Statechains the transfer of assets is through the ownership of the BTC deposit (UTXO) private key (ephemeral key).

Statechains will first create a multi-signature wallet between depositors and statechain entities with multiple private keys holding the bitcoins associated with it. The holder of the private key can create transaction records on Statechain and transfer the private key to others, thereby realizing the transfer of Bitcoin assets. Transactions in Statechain also do not require every confirmation, thereby increasing transaction speed and reducing handling fees.

One solution to Statechains technology is throughCommerceblockcreatedMercury walletAchieved.

Currently the total deposit in Mercury wallet is 23 BTC and the total withdrawal is 19.8 BTC, the application is still less. The liquidity of BTC must be a specific amount, such as 0.001 BTC, 0.01 BTC, 0.1 BTC, etc., so when recharging or transferring, only a specific amount can be used.

Drivechain

Drivechain is an open sidechain protocol for Bitcoin, which can customize different sidechains according to different needs.its designFrom two Bitcoin improvement proposals, BIP 300 "Hashrate Escrows" compresses 3-6 months of transaction data into 32 bytes through "Container UTXOs", and BIP 301 "Blind Mining" (Blind Mining) Merged Mining). Like RSK, the security of the network is maintained by existing Bitcoin miners through joint mining.

The emergence of Drivechain is to compete with Ethereum, Zcash, Bitcoin forked chains, etc., while maintaining the security and decentralization of Bitcoin, and introduce more functions to Bitcoin. These side chains also use Bitcoin's The anchor currency is used for transfer and other functions.

December 2022, the development company of DrivechainLayer 2 Labssummary

summary

Among the above Bitcoin expansion solutions, Stacks and RSK are more common. RSK supports EVM, and there are more funds in chain applications, but recently only Stacks has seen rapid data growth.

Among the several schemes mainly used for BTC payment, Lightning Network has the most BTC. Liquid Network is actively preparing for DeFi, NFT and other use cases. Statechains has limited applications. Although Drivechain can customize various side chains, it has not yet seen large Scale application.