Bitcoin Layer2 is ready to take off, can Ethereum's expansion path be replicated?

In 2023, Bitcoin welcomed a new asset type called "Inscriptions," sparking a market frenzy. However, Bitcoin, as a Layer 1, has its limitations, unable to support smart contracts and with performance constraints. The inscription craze quickly spread to the Bitcoin scaling track, initiating a Layer 2 boom.

As a star project, Merlin Chain saw its TVL reach 3.5 billion dollars after the staking activity began. However, after being listed, both the coin price and TVL plummeted, raising doubts about Bitcoin Layer 2.

Looking back at the Ethereum scalability journey, it has gone through exploration phases such as state channels, Lightning Network, and sidechains. It wasn't until the emergence of Rollup technology that issues like data availability were truly addressed and gained widespread recognition. Projects like Optimism and Arbitrum have flourished, driving the prosperity of the entire Layer 2 ecosystem.

Bitcoin Layer 2 has developed relatively early, but most solutions have issues such as insufficient decentralization. Currently, mainstream solutions include Lightning Network, Liquid Network, RGB, Stacks, etc., but no widely recognized solution has emerged yet.

Emerging projects like BEVM and Mezo bring new technological ideas. BEVM implements trustlessness based on Taproot Consensus, while Mezo utilizes tBTC as its foundation. These innovations are expected to drive breakthroughs in the development bottleneck of Bitcoin Layer 2.

Despite the challenges faced by Bitcoin Layer 2 development, the potential in this sector is enormous. There is a need for more decentralized, native, secure, and reliable projects to emerge, fostering a thriving ecosystem. As long as we move in the right direction, Bitcoin Layer 2 is expected to witness a real explosion, rather than a fleeting hype.