July 26, 2024 — UTXO Stack has announced a groundbreaking collaboration with Babylon to launch the first Bitcoin Layer 2 (L2) scalability solution based on the native UTXO model. This initiative will introduce a Proof-of-Stake (PoS) Data Availability (DA) chain to support L2s built on the UTXO Stack. Babylon will provide security for these PoS L2s and DA chains.
The solution features a UTXO model isomorphic with Bitcoin, ensuring security through a dual mechanism: user-staked RGB++ tokens and Babylon's remote BTC staking. It aims to create a high-performance, low-transaction-fee environment that supports Turing-complete smart contracts. This will allow users to pay fees directly using Bitcoin wallets and BTC.
The testnet for the UTXO Stack's Bitcoin L2 scalability solution is set to launch in the third quarter of this year, supporting the staking and restaking of assets such as BTC and CKB. The mainnet is expected to go live by the end of the year. This collaboration is anticipated to deliver an efficient, low-cost, scalable, and secure native L2 solution, further enriching Bitcoin's application scenarios.
In addition, UTXO Stack will launch the first BTC ecosystem appchain, which will primarily serve financial operations within the Bitcoin ecosystem. This financial chain will host assets and applications on the RGB++ Layer, including trading, lending, stablecoins, Initial DEX Offerings (IDOs), and other decentralized applications (dapps), accelerating the arrival of Bitcoin Finance (BTCFi). The appchain testnet will open for testing in Q3.
The appchain adopts the UTXO model and PoS mechanism, allowing for ultra-high transaction processing speeds and extremely low transaction fees due to the inherent parallel processing capability of the UTXO model. Users can interact with the appchain using Bitcoin wallets such as JoyID, OKX Wallet, and Gate Wallet, seamlessly using the RGB++ Layer. They can also use CKB smart contracts to stake CKB, ccbtc, and RGB++ assets.
As the first appchain based on the UTXO model, this financial chain will showcase the advantages of the UTXO model in terms of scalability, security, transaction speed, and fees. UTXO Stack looks forward to more community appchains being built on its platform in the future, including social chains, gaming chains, and more, further expanding the functionality and applications of the Bitcoin ecosystem.
To learn more about this project, please visit its website.