More than 20 projects claiming to be Bitcoin Layer 2 are currently under development in the market. However, there seems to be a disagreement among industry insiders regarding the definition of “Bitcoin Layer 2”.
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How does Bitcoin Magazine define Bitcoin Layer 2?
Is Stacks not Bitcoin Layer 2?
Which Bitcoin Layer 2 projects can succeed?
The editorial committee of Bitcoin Magazine recently released a press release emphasizing the magazine’s definition of “Bitcoin Layer 2”. The press release stated:
“Since the early stages of the Bitcoin protocol, developers have had ambitions to add additional functionalities to Bitcoin. From the initial sidechains such as Liquid and Rootstock, to future L2 solutions, Bitcoin Magazine has been reporting on these reasonable expansion plans. However, a group of imitators are seeking to exploit this trend to promote arbitrarily issued tokens. In the gold rush of Bitcoin L2, Bitcoin Magazine’s editorial committee believes it is necessary to clarify its stance on L2 reporting.”
Specifically, Bitcoin Magazine believes that projects defined as Bitcoin Layer 2 must meet the following three criteria:
1. Use Bitcoin as the native asset: L2 must be designed to primarily use Bitcoin as its main token or unit of computation, as well as its payment system fees. If it issues tokens, they must also be supported by Bitcoin.
2. Use the Bitcoin network as the settlement mechanism: L2 users must be able to exit the system through a mechanism (trusted or trustless) that allows them to regain control of their funds on the underlying Bitcoin network.
3. Demonstrate functional dependence on Bitcoin: If Bitcoin experiences a complete failure and the (Layer 2) system continues to operate, our position is that the system is not Bitcoin’s Layer 2.
In addition, Bitcoin Magazine also mentioned two protocols that, although they do not meet the definition of Bitcoin Layer 2, may still qualify for media coverage or attention due to their characteristics and role in the Bitcoin ecosystem.
1. Meta-protocols: Systems like Counterparty (XCP) or Ordinals that exist and operate on top of the Bitcoin protocol but go beyond its scope, without having their own independent blockchain.
2. Parasitic layers: These systems rely on the existence of Bitcoin and cannot operate independently without it, but they do not meet the other criteria required to be considered a second layer. Bitcoin Magazine currently does not report on these protocols.
It is worth mentioning that Spook, a technical editor at Bitcoin Magazine, believes that Stacks, a project considered as Bitcoin Layer 2, does not actually meet the magazine’s definition of Bitcoin Layer 2 because it does not use Bitcoin as the native asset of its network.
In response, Muneeb Ali, the founder of Stacks, stated in the comments section that after the Stacks network completes the Nakamoto hard fork in the future, sBTC (backed by Bitcoin) will be used as the medium for paying Gas, and at that time, these opposing views may be resolved.
According to a previous report by Zombit, Pantera executives have also discussed the elements that Bitcoin Layer 2 projects must have in order to succeed in an open letter. These include:
1. Consistency with Bitcoin’s economy.
2. Feasibility without changes to the base layer.
3. Modular architecture.
4. Trust-minimized cross-chain bridges.
5. Active marketing.
Although these five points are not specifically aimed at the “definition of Bitcoin Layer 2,” they do overlap with Bitcoin Magazine’s viewpoint, which may become a judgment criterion for future investors in the Bitcoin Layer 2 race.
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