Bitcoin developer sees ‘Bitcoin’s L2 era’ as key to mass adoption
Punk 3700, one of the developers behind Bitcoin Virtual Machine, assesses the potential of layer-two blockchains on top of Bitcoin as an important narrative in crypto's landscape for 2024.
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Projects built on top of Bitcoin, powered by Ordinals, are seen as a powerful narrative in crypto for 2024. Brazilian asset manager Hashdex classified Ordinals as ‘the industrial era of Bitcoin’ in its ‘Crypto Investment Outlook 2024’ report, while Nansen analysts made the ‘high-conviction bet’ that the blockchain of the biggest crypto by market cap will be used to secure other use cases than simple transactions.
In an interview with Crypto Briefing, the developer who identifies himself as ‘Punk 3700’ and is also a member of the team building ‘Bitcoin Virtual Machine’, discusses how projects built on Bitcoin’s blockchain could be a narrative investors should look out for this year.
Crypto Briefing: In layman’s terms, can you explain what the Bitcoin Virtual Machine (BVM) is?
Punk 3700 – BVM is the first modular blockchain metaprotocol that lets you customize and launch your own Bitcoin L2 blockchain protocol in a few clicks.
To explain it in layman’s terms, BVM is a tool that makes building on Bitcoin easy, where any developers can create custom blockchains tailored to their specific needs in just a few clicks.
Think of BVM as the decentralized Amazon Web Services that powers crypto consumer apps on Bitcoin.
Crypto Briefing: A few reports with 2024 perspectives pointed to growth towards Bitcoin L2 and Ordinals awareness. The Brazilian asset manager Hashdex believes that an ‘industrial era’ is coming with Ordinals, while Nansen points to projects built on top of Bitcoin as ‘high-conviction bets’ for this year. Do you believe that this movement will be that fast?
Punk 3700 – 2024 is setting out to be an important year for Bitcoin as ETFs are approved and projects built on Bitcoin are booming.
While Bitcoin ETFs show the maturity of Bitcoin as an asset class, Bitcoin L2s with seamless consumer apps will drive the mass adoption of Bitcoin.
The Bitcoin L2 ecosystem is in its early stages of development, besides Stacks and our Alpha Chain, you barely see any other Bitcoin L2 with working decentralized applications (dApps) and adoption. There’s still so much room to grow in this “L2/dApps on Bitcoin” scene. Think early Ethereum era around 2017 and 2018.
Nevertheless, we believe that by the end of 2024, Bitcoin L2s will be one of the main metas of the crypto bull run.
Crypto Briefing: When we talk about Ordinals and dApps built upon Bitcoin, the first image that comes to mind is Bitcoin blocks clogged with transactions. How does BVM deal with that?
Punk 3700 – BVM implements rollups on Bitcoin. Rollups significantly reduce the block time and transaction fees. This helps to scale Bitcoin without sacrificing decentralization or security. Increasing Bitcoin capability in terms of speed is fundamental to the mass adoption of decentralized applications on Bitcoin.
Alpha Chain (formerly NOS) is a great example. It’s a Bitcoin L2 powered by BVM that hosts Alpha app, the second biggest SocialFi platform by total value locked (TVL). Using Optimistic Rollup, Alpha Chain is lightning-fast (two-second block time) and low cost (less than $0.01 transaction fee), thus unlocking scalability for Bitcoin. Alpha Chain has handled more than 23,000 users, more than 870,000 transactions, and $36M in trading volume over the past 3 months.
Crypto Briefing: What are some use cases powered by Bitcoin that you guys are hyped about?
Punk 3700 – BVM will unlock Bitcoin with thousands of applications: since BVM is EVM equivalent, Ethereum developers can migrate their Solidity smart contracts and dApps from Ethereum to Bitcoin with minimal or no modifications.
Besides Alpha Chain by our team, we have been working with several talented teams and builders who are building their own Bitcoin L2s and dApps with us on Bitcoin, covering all sectors including DeFi, GameFi, Metaverse, AI, etc.
Crypto Briefing: Do you believe that, from 2024 forward, we’ll see a part of decentralized finance (DeFi) growing on top of Bitcoin, with its L2 reaching significant TVL?
Punk 3700 – Take a look at the recent stats: the TVL of Ethereum L2s has already surpassed the TVL of all L1s combined. These advantages, such as low fees and fast transactions, make L2s the clear path for widespread crypto adoption and the emergence of real-world DeFi applications.
The surging volume of Bitcoin-based assets like BRC-20 tokens and Ordinals on the L1 chain suggests that DeFi on Bitcoin L2s is poised for explosive growth.