Why Did CKB Surge 300% Last Month with RGB++ Transforming into a Bitcoin Layer-2?
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Why Did CKB Surge 300% Last Month with RGB++ Transforming into a Bitcoin Layer-2?
The veteran public blockchain successfully transformed into the PoW+UTXO school, becoming the "orthodox" successor to Bitcoin.
Navigating Web3 tides with focused insightsAuthor: Bowen
Bitcoin has finally stabilized above $70,000.
With continued momentum from ETFs, Bitcoin's total market cap has surpassed that of silver, rising to become the eighth-largest asset globally. Some institutional voices are nearing frenzy, with slogans like "Bitcoin will exceed $1 million per coin" echoing through communities—market sentiment is hotter than ever.
However, Bitcoin’s performance far exceeding expectations also suggests that narratives around halving and rate cuts may already be priced in early. On-chain activity shows miners aren't optimistic about the upcoming halving, with many teams building up cash reserves to prepare for reduced post-halving revenues. Ultimately, Bitcoin’s next phase must focus on expanding its payment network infrastructure—Layer 2 development is crucial.
In this article, TechFlow Salon presents a deep dive into CKB, one of the most talked-about Bitcoin Layer 2 protocols recently. Thanks to its innovative RGB++ asset issuance protocol, CKB achieved over 300% monthly growth. What makes RGB++ stand out, and why is it leading the market? Below, we explore how CKB has become a model case for public chains transitioning into Bitcoin Layer 2.
Team and Funding History
In early 2018, when attention was focused on the Ethereum ecosystem, CKB launched as a challenger public chain. In July of the same year, CKB raised $28 million, with prominent investors including Polychain Capital, Sequoia China, Wanxiang Blockchain, and Blockchain Capital participating. Later, on October 24, 2019, CKB completed an oversubscribed fundraising round of $67.2 million via CoinList. On November 16, 2019, the CKB mainnet “Lina” officially launched.
The CKB team boasts strong credentials, with founders deeply experienced in the industry.
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Chief Architect Jan Xie: A long-time contributor to Ethereum clients Ruby-ethereum and pyethereum, he also collaborated with Ethereum founder Vitalik Buterin on Casper consensus and sharding technology. Additionally, he founded Cryptape, a company dedicated to foundational blockchain platform development and consensus algorithm research.
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Co-founder Kevin Wang: Previously worked at IBM Silicon Valley Lab on enterprise data solutions and co-founded Launch School, an online school for software engineers. Kevin is also a co-founder of Khalani, an intent-driven centralized solver infrastructure (Khalani is a multifunctional "collective solver" that can seamlessly integrate into various intent-centric applications and ecosystems).
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Co-founder and COO Daniel Lv: Co-founder of the Ethereum wallet imToken and former CTO of cryptocurrency exchange Yunbi. Daniel also organized the Ruby China community for 10 years and co-founded ruby-china.org.
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CEO Terry Tai: Former core developer at cryptocurrency exchange Yunbi and co-founder of the tech podcast Teahour.fm.
PoW + UTXO
While the broader community focuses on TPS and PoS, the CKB team insists there should be no compromise on censorship resistance and permissionless access. Therefore, they chose to lower L1 performance to maintain sufficient decentralization, adopting an improved PoW mechanism and simple hash functions to ensure network security and permissionless participation.
Layered Architecture Philosophy
The internet built a relatively stable trust network through layered and decoupled architecture, but its level of trustworthiness remains limited due to lack of intrinsic self-guaranteeing protocols. The ideal cryptographic economic infrastructure envisioned by CKB follows a similar layered and decoupled design. Thus, the team decided to build a secure and scalable layered network where Layer 1 focuses on security and decentralization, while Layer 2 leverages Layer 1's security to achieve infinite scalability.
As a Layer 1, CKB stands for “Common Knowledge Base.” “Common knowledge” refers to universally recognized information—something everyone knows and knows others know. In blockchain terms, common knowledge means states verified by global consensus and accepted across the network—the very property enabling cryptocurrencies stored on public chains to function as money. Nervos CKB aims to store all forms of common knowledge, not just currency. For example, it can store user-defined cryptographic assets such as FTs and NFTs.
Layer 2 protocols can leverage CKB’s security while offering unlimited scalability. Notably, CKB’s proposed layered architecture was later embraced by Ethereum, which abandoned earlier execution sharding research in 2019 and shifted focus to Layer 2 scaling—a direction it continues to follow today.
PoW Mechanism Ensures Decentralization
CKB believes Layer 1 is the foundation of the crypto economy and must remain a permissionless network. In contrast, PoS allocates block production proportionally based on staking weight, conflicting with goals of decentralization and neutrality. By comparison, PoW is fully permissionless—anyone can participate simply by purchasing mining hardware and electricity. Moreover, forging or reconstructing a PoW chain requires re-computing the proof-of-work for every block, making it extremely difficult. While PoS offers better performance, CKB argues that if Layer 1 is to maximize decentralization and security, PoW is more suitable than PoS.
Cell Model Enables Scalability
With the resurgence of the Bitcoin ecosystem, debate between account models and UTXO models has reignited. Initially both interpreted around assets, over time UTXO kept assets central (peer-to-peer), while account models evolved to serve smart contracts, where users’ assets are held within and interacted with via smart contracts. This results in assets issued on UTXO chains having higher security levels than ERC-20 tokens on Ethereum. Beyond security, UTXO models offer better privacy—each transaction uses a new address and natively supports parallel transaction processing. Most importantly, unlike account models that perform computation and validation on-chain simultaneously, UTXO moves computation off-chain and performs only verification on-chain, simplifying application implementation without needing to optimize on-chain operations.
CKB not only inherits Bitcoin’s architectural philosophy but also abstracts the UTXO model into the Cell model, retaining Bitcoin’s consistency and simplicity while adding support for smart contracts. Specifically, Cell abstracts the nValue field representing token value in UTXO into two fields: capacity and data, where data stores state and arbitrary content. The Cell structure also includes LockScript and TypeScript fields—LockScript mainly defines ownership, while TypeScript enables rich customizable functionality.
In summary, the Cell model is a more generalized form of UTXO, giving CKB smart contract capabilities similar to Ethereum. However, unlike other smart contract platforms, CKB adopts an economic model designed for storing common knowledge rather than paying for decentralized computation.
Higher-Level "Abstraction"
The concept of "abstraction" is familiar to crypto users—it means removing system-specific features to create generality, allowing systems to apply to broader scenarios. The evolution from Bitcoin to Ethereum itself represents a process of abstraction. Bitcoin lacks programmability, making app development difficult. Ethereum introduced a virtual machine and runtime environment, creating a platform for diverse applications. Throughout its development, Ethereum has continuously abstracted further—from Vitalik’s repeated mentions of "account abstraction" to adding precompiles for "cryptographic abstraction."
Just as Ethereum abstracts Bitcoin, CKB in some ways abstracts Ethereum, providing developers greater flexibility and freedom.
1) Account Abstraction
CKB achieves account abstraction via the Cell model. For instance, UniPass, a wallet in the Nervos ecosystem, built an identity authentication system based on email and phone numbers, allowing users to log in using email and password—similar to traditional web accounts. The decentralized identity provider d.id developed .bit, a decentralized domain protocol leveraging Nervos' abstracted account features, enabling internet users, Ethereum users, and EOS users alike to directly interact with apps—not limited to CKB users only.
2) Cryptographic Abstraction
At the heart of cryptographic abstraction lies an efficient virtual machine. CKB uses CKB-VM, leveraging RISC-V instruction set properties to allow developers to implement cryptographic algorithms using languages like C and Rust. For example, JoyID wallet, built on CKB, fully utilizes Nervos CKB’s custom cryptography advantage, enabling password-free and seed phrase-free wallets secured by biometrics like fingerprints for wallet creation and transaction confirmation.
3) Execution Abstraction
CKB aims to build higher-level abstractions to improve performance and throughput. As abstraction increases, more tasks can be moved off-chain or to Layer 2. For example, while an Xbox is an abstract general-purpose platform, it still has limitations—hardware cannot be upgraded. A PC, however, allows users to replace GPU, CPU, RAM, and hard drives. Hence, a PC is a more abstracted system. CKB’s goal is to transform from an Xbox-like system into a PC-like one, meeting wider needs and offering greater convenience to developers.
RGB: Strengths, Weaknesses, and Opportunities
On February 13, 2024, CKB officially released the RGB++ Litepaper, quickly capturing widespread market attention.
RGB protocol is nothing new. In 2016, Peter Todd first introduced client-side validation and single-use seals, laying the groundwork for RGB. The core idea of RGB is to invoke the Bitcoin blockchain only when necessary—leveraging proof-of-work and network decentralization to prevent double-spending and resist censorship. All validation of token transfers is removed from global consensus and instead performed off-chain solely by the recipient’s client.
Key features of RGB include:
1. High confidentiality, security, and scalability;
2. No congestion on Bitcoin’s timechain since transactions retain only homomorphic commitments requiring extra storage;
3. Future upgrades possible without hard forks;
4. Greater anti-censorship than Bitcoin: miners cannot see asset flows in transactions;
5. No concept of blocks or chains.
For more on RGB, refer to: In-Depth Report: Understanding the Bitcoin Ecosystem RGB Protocol and Development Progress
Despite its elegant design, RGB has progressed slowly due to technical complexity. Key issues include:
Data Availability (DA) Problem: Transaction data is transferred only between sender and receiver. Critical information such as the UTXO’s historical branch is hard for average users to generate. Independent client data storage leads to data silos, preventing visibility into global contract states.
P2P Network Dependency: As an extension to Bitcoin, RGB transactions require a separate P2P network for propagation. Transfers require interactive steps—for example, recipients must provide receipts—all dependent on a P2P network independent of Bitcoin.
Virtual Machine and Contract Language: RGB currently relies on AluVM, a new virtual machine lacking mature developer tools and practical codebases.
No Support for Stateless Contracts: RGB lacks robust interaction schemes for stateless (public) contracts, limiting multi-party interactions.
RGB’s strengths and weaknesses are clear-cut. Privacy- and security-conscious users may run their own clients and back up data, but long-tail users clearly lack such patience (for example, most Lightning Network users rely on third-party nodes rather than running their own).
Given this, Nervos CKB co-founder Cipher proposed RGB++, which delegates RGB’s asset state management, contract publishing, and transaction validation to the CKB public chain. CKB acts as a third-party data custodian and computing platform, eliminating the need for users to run RGB clients themselves.
RGB++
RGB++ is an extended protocol based on RGB principles. It leverages the architectural similarity between RGB’s core component (UTXO) and CKB’s base layer, combining two key aspects of RGB with CKB’s architecture:
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Isomorphic Binding: The UTXO serving as an RGB container can be mapped and bound to CKB’s Cell.
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Client-side validation under RGB becomes on-chain public validation on CKB, where verified data and states correspond to the data and type fields within Cells.
Crucially: RGB++ and RGB are distinct concepts. RGB primarily extends using the concept of single-use seals; RGB++, however, emphasizes the possibility of other UTXO chains acting as RGB++ clients, with its key innovation being the idea of isomorphic binding.
In the RGB protocol, the two most important components are the UTXO for ownership verification and the commitment for state management and single-use sealing. RGB++ maps Bitcoin UTXOs one-to-one onto CKB Cells, using bitcoin locks to synchronize ownership, and utilizing Cell’s data and type fields to maintain state.
This approach not only resolves the challenges faced by RGB but also unlocks new possibilities:
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CKB blockchain serves as an enhanced validation client: Every RGB++ transaction appears once on both BTC and CKB chains. The former ensures compatibility with standard RGB transactions, while the latter replaces client-side validation. Users only need to check related transactions on CKB to verify correctness of the RGB++ state computation—eliminating DA problems and data silos.
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Enhanced Security and Reliability: Synchronization does not rely on trusted cross-chain bridges or multisig mechanisms, but on direct binding between two UTXOs. Based on PoW security standards, Bitcoin transactions become irreversible after six confirmations; on CKB, approximately 24 blocks provide equivalent security. This ensures safe “jumping” or migration of assets across layers.
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Transaction Folding: Isomorphic binding between Bitcoin UTXO and CKB Cell enables Turing-complete Bitcoin UTXO transactions validated via CKB Cells. Leveraging CKB’s programmability, multiple CKB transactions can map to a single Bitcoin RGB++ transaction, effectively using high-performance CKB to scale the slow, low-throughput Bitcoin mainnet.
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Non-Interactive Transfers: A key limitation of original RGB is that the recipient must be online to complete a transfer, increasing user friction and product complexity. RGB++ leverages the Turing-complete environment on CKB to embed interactivity, implementing a send-and-claim two-step flow for non-interactive transfers.
In summary, RGB++ inherits RGB’s core philosophy but employs different virtual machines and validation methods. Users no longer need standalone RGB++ clients—just access to lightweight Bitcoin and CKB nodes suffices for full independent verification. RGB++ brings Turing-complete contract extensions and tens of times performance improvement to Bitcoin. It avoids cross-chain bridges entirely, relying instead on native client validation to ensure security and censorship resistance.
From CKB’s perspective, future compatibility with more protocols will be the driving force behind its continued growth.
The Future of CKB
By adhering to Bitcoin’s PoW+UTXO technical lineage, CKB positions itself on the "orthodox high ground" technologically, earning broad attention from the community and market. Many believe that compared to EVM-compatible chains, RGB++ preserves Bitcoin UTXO orthodoxy, with the team deeply rooted in the Bitcoin ecosystem. Whether it’s layered architecture, UTXO abstraction, or the recently proposed OTX protocol CoBuild Open Transaction, these represent extensions and innovations of Bitcoin’s original vision.
Yet, some argue CKB suffers from over-positioning. From its 2019–2020 collaboration with Huobi to its gaming focus from 2020–2022, none yielded substantial progress. Hence, this latest pivot toward Layer 2 might be seen as speculative hype.
Nevertheless, CKB has undeniably ignited market enthusiasm. Among the flourishing landscape of Bitcoin Layer 2 protocols, first movers naturally gain capital and traffic advantages, making breakthroughs easier. But compared to most EVM competitors, whether CKB can attract enough developers to sustain its ecosystem remains to be seen—and depends entirely on its future execution.
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