While many view Bitcoin as merely "digital gold", Bitlayer is leading a radical shift in the narrative through its suite of BitVM technologies, providing Bitcoin — with a market value of $1.3 trillion — with a real financial operating system. With $25 million in funding led by Franklin Templeton, Bitlayer is transforming into a pivotal player in shaping the contours of Bitcoin's decentralized finance (BTCFi).
1. Technological breakthrough: BitVM unleashes Bitcoin's "financial genes"
The core challenge for Bitcoin lies in the contradiction between the security of the UTXO model + SHA-256 and its limited programmability. While its core protocol only supports simple transfers, complex financial applications (such as lending or derivatives) have relied on centralized intermediaries like WBTC.
BitVM Bridge: From "Trust of Custody" to "Trust of Encryption"
By separating on-chain verification from off-chain computation, BitVM allows for the issuance of YBTC (1:1 pegged to Bitcoin) without the need for multi-signature intermediaries.
If a node acts maliciously, users can activate the "challenge-response" mechanism that automatically verifies behavior and returns assets within 24 hours.
Quantum security
The cost to attack the BitVM bridge is $120 million, five times higher than the multi-signature bridge attack (~$20 million).
"Income Programmability" for YBTC
YBTC integrates native financial units such as:
Automatic returns (Staking)
Cross-chain arbitrage
Building hedge wallets using stablecoins
2. Bitlayer Network: Balancing performance and security
Double Layer Rollup Structure: Using ZK-SNARKs to compress thousands of transactions before writing them to the Bitcoin block, the network's capacity reaches +3000 transactions/second (400 times that of the main Bitcoin network).
Full EVM compatibility with a response time of 10ms, three times faster than Optimism, preventing "liquidation arbitrage" vulnerabilities.
Miner incentives: They receive Bitcoin rewards + Bitlayer network fees (BTR), linking their interests to the ecosystem.
3. Environmental Expansion: From technology to value
YBTC as a unified liquidity interface: Integration with Base allows YBTC to be used directly in Aave protocols, increasing BTC transaction volume by 210%.
Sui Ecosystem: The introduction of YBTC increased the Total Value Locked (TVL) by 15%.
Cardano and compliance: Launching hybrid products (YBTC + treasury bonds) attracted institutional funds of $12 million.
Institutional entry
Institutional API interface to meet regulatory audit requirements.
Fixed-price Bitcoin hedge tool with an annual yield of 4.8% for 6 months.
Tokenization of Mining Assets: Antpool raised $30 million from the sale of "Computing Power Income Certificates."
Developer incentives
An environmental fund ($2.5M) to support the first 50 protocols.
Security alliance with CertiK, with rewards up to $100,000 for bug discoverers.
BitVM Academy to build a new generation of YBTC developers.
4. BTR Economy: The value center in Bitcoin DeFi
Infrastructure fees: 30% of which go to repurchase and burn BTR (230K destroyed so far).
Environmental rights: Discounts on gas fees + boosted Staking income.
Institutional subscriptions paid in BTR, enhancing a natural deflationary cycle for the token.
Gradual airdrop based on real activity, with 70% of BTR locked for 6 months.
5. Competitive barriers: Three-dimensional defense
Technology: Pioneering BitVM and foundational patents, working on BitVM 2.0 to reduce cross-chain verification to 3 minutes.
Ecosystem: YBTC controls 37% of BTC liquidity in DeFi, surpassing WBTC and STX.
Compliance: Regulatory partnerships (SEC + MiCA) give Bitlayer an institutional advantage that is hard to compete with over the next 12-18 months.
6. Risks and Opportunities
Risks
Probability of revealing technical vulnerabilities with widespread use.
The difficulty of convincing Bitcoin stackers to transition to using YBTC.
Potential regulatory risks (classifying YBTC as a derivative).
Opportunities
Raising Bitcoin's share in DeFi from 3% to 10% means $130 billion in new liquidity.
Potential revenue from fees could reach $1.3 billion annually.
Estimated market cap for BTR could exceed $5 billion.
The programmable Bitcoin revolution is irreversible
Through Bitlayer, Bitcoin transforms from merely a reserve asset to a global financial infrastructure capable of generating income, managing risks, and integrating with traditional finance. Institutional finance, cross-chain expansion, and technological superiority place Bitlayer in a leading position.
For investors, it is not about tracking momentary price fluctuations, but understanding that Bitlayer sets a new standard for BTCFi — and with the standard set, value will inevitably flow.