Bitcoin L2 Founders Debate Before Hong Kong Conference: Where Is Hope in the Toughest Times?
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Bitcoin L2 Founders Debate Before Hong Kong Conference: Where Is Hope in the Toughest Times?
How to establish a differentiated path among numerous Layer2 solutions?
Navigating Web3 tides with focused insightsHost: BMAN, ABCDE Labs
Guests: Jeff, Merlin Chain; Ryan Chow, Solv Protocol; CharlieHu, Bitlayer; Stan, B² Network
This episode is a Twitter Space organized by ABCDE Labs. The content does not represent the views of Wu Shuo. Listen on Xiaoyuzhou FM:
https://www.xiaoyuzhoufm.com/episodes/66376ca603bcdd73a9944fb2
Listen on YouTube:
https://youtu.be/-8uCUBRanxE
BMAN: Merlin had its TGE just over a week ago. Jeff, you've probably been through a whirlwind of emotions these past ten days. What are your thoughts?
Jeff: First, I think our asset bridging—both inbound and outbound—wasn't fully prepared. We're dealing with BTC, BRC-20, NFTs, ETH, USDT, Manta, and many other assets. This makes bridging extremely complex. Most chains tend to be cautious at launch, but since we came from Web2, we took a wilder approach, integrating every protocol available, which led to current bridging issues. However, for BTC specifically, our bridge has become very stable. Looking at on-chain data, over the past month, around 78,000 BTC were bridged in and over 70,000 BTC out. Liquidity is strong—few exchanges can match this volume of BTC flow.
But with NFTs, runes, and integrations like Manta, Tron, MODE, Layer3s, and ongoing discussions with Linea, the sheer number of assets exceeds our control. Trying to do everything at once severely impacts user experience. That's my first takeaway.
Second, what are the real advantages and disadvantages of fair launches? Last year, everyone believed in fair launches—BRC-20, BRC-420—all without whitelists or invites, just open participation. But looking now, performance has been mediocre. We thought ORDI might hit $100 or even $1,000, but market corrections have caused sharp drawdowns in ORDI and SATS. Runes use two methods: pre-runes (distributing NFTs first for trading before minting tokens) and pre-mint, which has become widespread.
Fair launches have clear pros and cons. For example, Merlin’s token distribution meant users received all airdrops within 6–12 months, creating massive sell pressure. Once the market turned downward—from BTC dropping from $70k to near $60k, possibly below $50k—the selling pressure intensified. Even so, Merlin consistently ranks among the top new tokens on OKX in daily trading volume, showing intense market activity. We’ll see how it unfolds from here.
BMAN: There are already dozens of Bitcoin L2s. How can one differentiate and stand out?
CharlieHu: Back in September last year, everyone was FUD-ing Ordinals. “Ordinals is dead” became a meme. But when everyone’s against you, it’s often a bottom signal. Persistence pays off—it’s part of the process.
Bitcoin L2s are now in an interesting phase. Two months ago, people said there were over 100 Bitcoin L2s. But upon closer look, only a handful are truly progressing, with active communities and strategic vision. I believe only single-digit projects will genuinely advance the industry in tech, product design, and market fit. Gaining mindshare—getting into people’s mental space—is crucial because no one remembers more than 10 Bitcoin L2s. Differentiation is key.
There are three types of differentiation. First, technical: Is there something unique in security, scaling, or developer environment? At Bitlayer, we’re pushing two tech stacks. One is BitVM—we’re among the earliest and most active Asian teams researching BitVM, globally ranked in the top three. We’ve contributed three SHA256 upgrades, two commits, and received two grants from the official BitVM team. We’re not just waiting—we’re actively building.
Second is DLC—a greatly underestimated technology proposed by MIT professors that enables decentralized cross-chain bridges. We’re combining DLC with BitVM to build advanced bridges, with detailed features already developed and soon to be released by our engineering team. These details are also included in our technical whitepaper.
The second area is product innovation. Merlin has brought significant innovations to the Bitcoin ecosystem. We’re exploring diverse product paths, especially in Bitcoin DeFi. From my experience during DeFi Summer in 2020—as investor, retail trader, and developer—I’ve seen how Ethereum L2 DeFi projects explore new narratives and grow TVL. Activating Bitcoin’s TVL means unlocking new Bitcoin-native DeFi-like applications, asset strategies, and use cases. TVL evolves from fake or idle TVL to real, actively used TVL—this is gradual. Real utility maximizes asset efficiency across various scenarios.
Whether it’s Bitcoin-based stablecoins, DEXs like Uniswap v2/v3, money markets, lending protocols, structured financial products, yield boosters like Yu’ebao, Solv, re-staking, options, or futures—DeFi already offers many models. I expect fresh DeFi innovations in Bitcoin this year, 2024. On the ground level, while full-scale BitVM deployment may take time, using ZK proofs written directly to Bitcoin L1 will likely happen faster—that’s what we’re exploring now: product-driven differentiation as a Bitcoin L2.
The third aspect is culture. This cycle’s breakout infrastructure project is Berachain. They hosted extravagant cultural events in Dubai and Denver, elevating their presence. Their cultural influence captures attention, builds sticky communities, and attracts developers and users. It’s a powerful model we’re learning from—including their founder’s approach and marketing tactics.
At Bitlayer, we’re investing heavily in branding around racing, acceleration, and the Bitcoin engine. Our leaderboard rankings follow an F1-inspired model, exploring cultural engagement. Only blockchains that master culture can unite long-term, consensus-driven communities—not just short-term airdrop farmers who move to the next ecosystem. In summary: differentiate via infrastructure tech, product innovation with real-world applications, and cultural impact.
Stan: I agree with much of what Charlie said. Demand for Bitcoin usage is huge. Miners holding BTC want ways to utilize it, earn yield—this need has always existed. But Bitcoin’s infrastructure lags far behind. BitVM, mentioned earlier, emerged last year as a groundbreaking paper offering valuable insights. But realizing it fully will take time. So at B² Network, instead of aiming for general computation on Bitcoin L1 like BitVM, we focus on solving simpler problems—like verifying ZKPs on Bitcoin L1.
Our core differentiator is tackling painful bottlenecks while proposing a modular architecture. If we view the Bitcoin ecosystem as a large computer needing scalability and general computation, we can divide the architecture into three layers—execution, DA (data availability), and consensus—just like traditional blockchains.
Execution layer: Projects like our b² rollup and Merlin Chain serve as execution layers, capable of infinite horizontal scaling—we can deploy multiple rollups.
DA layer: Bitcoin lacks mature DA solutions. We implement DAS via B² Hub. Others like Nubit are also building their own DAS. Our DA layer integrates decentralized storage. This isn’t a solo effort—we aim to collaborate, recording final data indexes and proofs collectively on the Bitcoin network.
Consensus layer: This is where all builders trust Bitcoin most. Bitcoin holds the strongest consensus in crypto, backed by massive mining power and computational resources. By combining on-chain commitments with off-chain verification and challenge mechanisms, Bitcoin L1 can verify whether transactions on our L2 are valid and free of malicious behavior.
With this architecture, we aim to bring it to market—not as a closed system, but as an open framework others can adopt. We hope builders will use our two products. The first is our rollup—an EVM-compatible chain using BTC as gas. Its performance and UX rival leading Ethereum L2s. Thanks to this architecture, final settlement occurs on Bitcoin. We’re not a sidechain; our security doesn’t rely solely on ourselves—we maximize reliance on Bitcoin’s security.
Our second product, the DA layer, solves a critical pain point: enabling secure ZKP commitment verification anchored to Bitcoin. Ethereum’s DA exists to make Ethereum L2s cheaper and faster. Without Bitcoin-native DA, rollups on Bitcoin cannot exist—they’d be fake rollups. Bitcoin DA is essential. These are our key strengths. We aim to prove the feasibility and security of modular Bitcoin scaling, inviting other builders to join this architecture and expand Bitcoin in their own ways.
BMAN: How do you view the landscape of Eastern vs. Western Bitcoin ecosystems? Who holds the advantage? How will they diverge in the future?
Ryan Chow: From Solv’s perspective, we’re an Asia-born team but have deep collaborations across both Eastern and Western public chain ecosystems. My observation: the Bitcoin ecosystem consists of several modules. The first is inscriptions and runes. Initially driven by Eastern inscription projects, runes are now gaining traction in the West. We’re seeing a balanced competition—Western cultural-themed Bitcoin assets are emerging. It’s a diverse landscape. I believe both East and West will coexist, even converging toward shared assets as more Western users adopt platforms like OKX Web3 Wallet, Merlin, and infrastructure like Unisat. This shows infrastructure is unifying first—only then can new assets converge. Otherwise, fragmented base-layer infrastructures hinder progress.
Second, regarding Bitcoin L2s: the West has introduced infrastructure like Botanix and Bob. But overall, in terms of technical innovation and ecosystem development, I believe Eastern/Asian projects are more comprehensive.
Asia has paved the way, inspiring many Western projects and providing extensive user education—especially impactful. Most Bitcoin retail users today are Asian. The emergence of Eastern L2s has primarily educated these new users. Now, Western L2s aim to ride this wave, attracting Asian users to bootstrap their ecosystems—a clear trend.
In technical innovation, both sides have strengths. As shared by the other L2 founders here, their deep thinking and innovative mechanisms clearly match or exceed those of projects like Botanix or Bob.
Everyone is innovating. Often, success hinges on packaging concepts effectively and getting markets to rapidly adopt them. Underlying technical foundations are solid on both sides. But Western chains hold a natural edge in English-language promotion—they dominate discourse in Western circles. We Asians have fewer speaking opportunities there, creating a real difference.
Ultimately, though, the primary user base remains Asian retail investors. This explains why Western Ethereum ecosystem players rarely held major events in Asia—until now. Today, numerous Western L2 teams frequently visit Asia, especially Hong Kong, to host BTC-related ecosystem events. Capital and users are clearly centered in Asia.
Here’s an interesting insight: I know teams building Bitcoin L2s who approached Western institutions for BTC funding support—and found it extremely difficult. Many institutions require extensive audits and compliance checks. After long delays, they might get only 100–200 BTC. Meanwhile, in Asia, a single miner might hold 1,000 BTC.
So in legitimacy, both sides are equal—unlike Ethereum, where the West holds dominance. But in user scale and capital size, Asia enjoys a massive first-mover advantage—much like Binance and OKX’s early growth fueled by Asian markets before going global. For this reason, I’m more bullish on Asian L2s. Since I’m not building an L2 myself, this is my neutral, third-party view.
We also see foundational infrastructure like Babylon’s restaking. From a Western perspective, this approach often works well. Babylon’s restaking infrastructure demands high credibility and brand prestige. Engaging Stanford professors and launching in Europe and America proved effective. Their model remains hot lately—a proven path. Finally, application layers: Solv sits strictly in this category—as liquidity infrastructure or a “Bitcoin Yu’ebao.” Here, innovation levels are equal globally. The winner will be whoever achieves higher TVL first, builds stronger global brands and user bases, and gains earlier exchange exposure. That entity will gain a decisive lead.
We’re already seeing rapid growth in Asian Bitcoin application-layer products, gaining significant influence in the West. A recent realization: many Solv users started in Asia—even Japan—drawing heavy Asian participation. Yet, Western institutions and BTC ecosystem players now feel intense FOMO. At the app layer, there’s less bias based on origin. People aren’t rejecting projects just because they’re Eastern or Western. The barrier isn’t that strong.
CharlieHu: "East vs. West" has multiple dimensions—geographical, cultural. We Asians are in the eastern hemisphere, different time zones. Culturally, Chinese communities exist worldwide. Teams behind Babylon, Nubit, and others include influential overseas Chinese figures. Eighty percent of our first-round investors were Western institutions—we aimed to build in Asia and expand overseas.
I believe Bitcoin’s ecosystem is entering its 2.0 phase—the second half. It won’t be limited to Asian communities alone. On the asset side, BRC-20 was 70–80% Chinese and Southeast Asian users last year. Now, runes may be led by the West—but Asia is catching up fast. This is a fused, parallel advancement.
L2s are even more collaborative—driven largely by developers. Going back to 2017’s ICO boom and 2020’s DeFi Summer: many successful Chinese projects emerged in 2017, some still ranking in the top 50 or 100.
Chinese founders, communities, and technical teams. But during DeFi Summer 2020, we fell behind—two reasons. First, Western teams had deeper understanding of financial product design. Second, they were closer to the Ethereum Foundation, which was predominantly Western. This disconnect excluded many capable Chinese and Chinese-descent individuals from being early DeFi builders. Early leaders—from Uniswap to yield aggregators to DYDX—weren’t Chinese teams. Only later, with BSC, Polygon, and other chains, did more Chinese teams emerge—often by forking early blue-chip Ethereum projects.
Bitcoin is different. After a full-year DeFi cycle and bear market consolidation, many products are mature, tested across multiple chains. Many incoming builders—from Ethereum or other PoS ecosystems—are highly experienced, having survived multiple bull-bear cycles. They’re seasoned. Teams like Solv, founded in 2021, have accumulated substantial product expertise. These Chinese teams are battle-tested.
Their product design and operational skills match or surpass Western teams. They have global channels, KOL networks—nothing lacking. Market entry is fair: if your product is good and your terms favorable, partners will work with you. Every market has collaborators who don’t care if you’re Chinese or Western. Ultimately, cooperation depends on merit.
Valuations? Many Western L2s and apps carry relatively high valuations—but we’re not disadvantaged. Cost-wise, we have an edge. Our engineers and operations teams are more driven, faster, and lower-cost—clear competitive advantages.
Regarding Bob and others—I know their background. Many teams previously worked in Polkadot or Ethereum ecosystems without major success, now seizing Bitcoin opportunities. When I met Alex and Dominic in Denver and Dubai, they shared similar journeys—from Polkadot in 2018–2019, to Ethereum, now Bitcoin. We’re all converging. Our real competitors should be BeraChain, Blast—not imaginary rivals. Constantly FUD-ing hypothetical enemies is pointless. Those teams have their own issues. That’s one thing.
Second, Bitcoin ecosystem teams—East and West—are increasingly fusing. The upcoming Hong Kong Bitcoin Conference will likely be the strongest convergence yet. I don’t foresee fragmentation—instead, greater integration. Capital will flow to Hong Kong. Many institutional attendees appear Western, but they deeply understand China. So there’s no absolute East-West split—only choices.
Eastern users may prefer Cobo or Spark wallets; Western users lean toward Coinbase—just brand preferences. But on first principles—Bitcoin’s values, L2 security, trustlessness, DA—there’s strong shared consensus. Ironically, the deepest divide today is between Ethereum and Bitcoin communities. We’re actively engaging Ethereum’s inner circles, sponsoring events, helping core Ethereum developers recognize Bitcoin’s opportunities, and bringing their expertise, resources, users, and products into Bitcoin’s ecosystem. That’s Bitlayer’s mission—to add incremental value. Merely competing for existing inscription users isn’t our goal. We’re location-agnostic, reaching users globally—not just in Asia.
BMAN: Today’s topic: uniting Chinese builders to strengthen the Bitcoin ecosystem. Since Bitcoin’s roots trace back to Chinese and Eastern origins, how can we—builders here today—collaborate better?
Jeff: East vs. West represents different values and working styles—neither superior nor inferior. But market perceptions differ. This perception gap can be broken. Markets hold higher expectations for Eastern projects, especially Chinese-led ones. Why? Because Westerners may distrust Easterners—and Easterners distrust each other. So scrutiny is extreme—you’re examined under a microscope, not a magnifying glass. Whether it’s airdrop amounts, rules, circulating supply, staking/unstaking mechanics, bridge timing, or costs—every dimension faces intense scrutiny.
That said, Bitcoin’s ecosystem suits Chinese builders—whether trading or building. Here, there’s no “God”—anyone can create without judgment. In other ecosystems, anyone who’s built knows: there’s always a gatekeeper, a central authority. It becomes political. My biggest takeaway after a year in Web3: Web3 is more centralized than Web2. You must please the “God,” listen to decrees, and execute perfectly. Chinese builders are naturally distant from Western “gods.” Hence, few Chinese projects in Ethereum achieve top-tier status. Most occupy supporting roles—building tools or handling undesirable tasks.
Bitcoin is different. It’s a fair playing field. I joined Ordinals early—so we naturally have community, users, and assets, making it easier to launch. Many chains now compete to recruit our developers for multi-chain deployments.
We encourage developers to deploy across chains. The industry is too early—applications gain different insights and resources from diverse user ecosystems across chains. This cross-pollination enriches the entire Bitcoin ecosystem. If, a year from now, Bitcoin’s total asset market cap hasn’t surpassed $10 billion, that would be tragic.
But if we grow it together, rising market cap and stronger narratives will amplify our collective voice—whether Chinese or Western builders. Currently, many top-tier overseas institutions or individuals mock Bitcoin L2 efforts.
Understandable—many mocked Ethereum in its early days. Incumbents always look down on newcomers. Just as Bitcoin OGs once asked, “Why smart contracts? Crypto is digital gold. Why not just buy Litecoin?” The first incumbents missed the boat. Now, new incumbents mock Bitcoin L2s: “It’s fake!”
Intentional or arrogant—the term “Layer2” itself is invented. Five or eight years ago, mentioning “Layer2” would’ve drawn ridicule from Bitcoin OGs: “No one uses Layer1—why talk about Layer2?” Now, having captured Layer2 narrative control, they claim Bitcoin doesn’t need or can’t have Layer2s—just as they mocked Ordinals last year and runes today.
History repeats—each time with variations. Today’s builders—East or West—must move forward together. Competition is inevitable—and healthy. It pushes everyone to excel. When building, you ask, “How do competitors do it? We can’t fall short.” That mindset is fine—as long as it avoids destructive infighting. Only then can the industry progress. That’s my view.
Stan: Western dominance in narrative control peaked in the last cycle—driven by Ethereum, DeFi Summer, and major innovations originating from Ethereum. Ethereum became the mainstream standard, shaping dominant narratives. Top academics from Western universities endorsed these ideas, reinforcing them. EigenLayer and Babylon follow this pattern. But Bitcoin’s advantages remain clear: miners and exchanges are largely Eastern-backed. Core Bitcoin users are concentrated in Asia-Pacific. In asset size, user base, and liquidity, the East holds undeniable advantages—including giants like Bitmain. These strengths are hard to replace. We must leverage them.
Within our projects and among Chinese-led teams, organic integration is key. Make products more modular, composable, and interoperable—avoid reinventing wheels and reuse each other’s strengths. Tomorrow, we’ll announce our POS protocol—a composable design. We won’t issue receipts ourselves; third parties can. Opening such protocols allows others to build upon them—or fork the code to create improved versions. As long as we maintain a cooperative, composable, communicative state, Chinese Bitcoin builders can keep advancing.
I attended events in Dubai and TOKEN2049—many insights. Consider Dubai’s rise: several factors mattered. First, strategic geography. Loosely speaking, Dubai sits at the crossroads of East and West—similar to Bitcoin’s role as a strategic hub in crypto. Bitcoin builders inherently occupy a pivotal position.
Second, Dubai champions free economic policies. Similarly, Bitcoin L2s should increase trade, enable seamless asset circulation—critical for growth.
Third, Dubai invested heavily in infrastructure. The Bitcoin ecosystem should jointly support exceptional builders in wallets, account abstraction, and foundational tools—creating world-class facilities like airports and ports. Dubai’s landmarks—like Burj Khalifa—became magnets, drawing global attention. I hope Merlin, Bitlayer, B², or even absent CKB, will grow iconic applications—like GMX on Arbitrum. Each chain needs flagship apps.
Merlin and Bitlayer are already collaborating—we jointly support outstanding builders. Comparing a blockchain to Dubai may seem odd, but in Web3, a chain with hundreds of thousands of users is already a major ecosystem. We’re still extremely early. No need for division. Bitcoin is the gateway for non-Web3 natives entering Web3. As engineers, our first blockchain lesson is always Bitcoin—PoW, UTXO. Bitcoin’s influence in internet and traditional finance endures. It’s the first thing people hear about in crypto or Web3.
A child’s first question to dad is always, “Dad, do we have Bitcoin?” Not “Dad, do we have Ethereum?” Leverage this gateway advantage. The market is vast. Build composable, reusable products—and together, push Bitcoin forward.
Ryan Chow: From Solv’s angle, we’re practically united and collaborating. Our purpose? To better serve all users together. Ultimately, capturing significant market share—or dominance—in the Bitcoin ecosystem hinges on serving users exceptionally well. Meet all their needs. Example: Ethereum introduced PoS—then Lido emerged. Was Lido aligned with Ethereum? Yes—born from Ethereum’s ecosystem. But more importantly, Lido understood Ethereum whales’ needs, co-designed with them. Being close to users, they anticipated demand a year ahead—launching products perfectly timed for market needs.
User base is in Asia—same as early exchange growth. In Asia, exchange products are best built by Binance, OKX, Huobi. Obvious. Likewise in Bitcoin, I see less rigid orthodoxy or ideology than in Ethereum. Instead, I see deep user understanding—translating insights into concrete products.
Whether it’s Solv at the application layer or infrastructure teams, knowing market needs enables building what’s required. Then adoption follows. That’s the greatest significance. I’m confident BMAN and ABCDE Labs organizing deep exchanges—discussing user trends, real market pain points—will naturally reveal our positions.
Earlier, B²’s founder made excellent points—about angles of entry, serving diverse user needs. Classic examples of deep user insight driving conclusions. I’m optimistic.
Users and markets are in Asia. But like Binance expanding to Europe, the Americas, Southeast Asia, we start from Asia but serve global users. Still, rule-making power likely resides in Asia. Radiating outward from here, we can build something remarkable.
One final note: I observe a clear East-West divergence in market pain points. Asian users often trust custodial solutions like Cobo or Bitmain—centralized trust backed by technical frameworks. This model is well-validated in Asia. But many Western users reject it—they demand fully decentralized, trustless Bitcoin bridging, custody, or mapping solutions. This divide is real.
But this doesn’t mean only Westerners can build fully decentralized Bitcoin solutions. Many attempts in Asia show promise. If achieved, such solutions would first capture Asian miners and large users. Then, by studying genuine Western demands, integrating them into Asian-built projects, we can better serve both sides. Ultimately, both East and West can be onboarded. The core lies in user needs. Ideology matters—but isn’t insurmountable. Binance, Bybit, OKX’s successes prove that. So, unity’s value lies in uncovering real market needs, iterating better products. I remain confident.
BMAN: Major Chinese projects shouldn’t just communicate—they should actively support and promote each other. Recently, I saw a post claiming Indians dominate this cycle. Last cycle too—Polygon, major funds. This cycle even more so: EigenLayer, Aave, AI projects, Polygon’s founder’s new venture—all Indian. BeraChain’s co-founder is Indian. Indians band together tightly. In Hong Kong, I heard stories: senior Indians like Sreeram from EigenLayer and Sandeep from Polygon lead groups of junior Indians—mentoring, boosting their ecosystem presence. Indians stick together—now dominating Silicon Valley.
Microsoft’s CEO is Indian. Makes you reflect. Since 2013, Chinese teams dominated crypto—but now, who FUDs Merlin most? Other Chinese. Why? Compare airdrop designs: Merlin fairly launched 20% of its supply—extremely generous. Contrast EigenLayer—stingy积分 distribution, minimal airdrops recently.
Why are Chinese so harsh on their own projects? Why not unite, champion our own lane? That moves me. So I propose—ABCDE is willing to lead: let’s organize top Chinese projects to swap tokens post-TGE. Pool part of our tokens into a dedicated fund supporting Chinese Bitcoin builders.
This cycle is tough for Chinese teams—I feel it deeply. As Jeff said, Chinese projects face microscopic scrutiny from users, exchanges, VCs. Nobody likes them—including other Chinese. At least we founders can unite, exchange value, collaborate. Form an ecosystem fund focused on Chinese Bitcoin projects. I hope all ABCDE-backed Bitcoin projects join—support each other. At minimum, stop FUD-ing our own. Let’s unite like Indians—or even more tightly. Indians have dominated two cycles. What do they have? Not the largest crypto population, no native exchanges or top funds. Yet, in every ecosystem, crown-jewel projects are Indian. And who cheers loudest for Indians? Often, Chinese—investing in BeraChain, EigenLayer. How much capital or TVL do Chinese contribute? Why do Chinese uplift Indians but not Chinese? I’m baffled. After a decade in crypto as a Chinese investor, I’m pained. We must learn from India.
CharlieHu: I have some experience here—perhaps not authority, but proximity. Among us builders, I’m closest to Indians. Two points: First, Indians deserve study. Where we can’t beat them, we should learn—not necessarily join, but learn to eventually outperform. Yes, they’re nicknamed “third brother” jokingly. Many projects, including early Polygon (Matic), faced disdain initially. Americans looked down on them; they lacked US capital success. EigenLayer succeeded due to Stanford affiliation—without it, maybe nothing. Aave rose because Polygon’s former leadership sold out, spotting opportunity as Celestia’s DA play gained traction. Their success stems partly from unity.
Equally important: market insight and alpha detection—sharp and timely. I’ve felt this. Since last year, Chinese alpha groups—around 30 elite members, selective, tight-knit—privately share exclusive opportunities: private sales, public trades. These groups multiply—positive signs. Indians have countless such networks. Major opportunities rarely surface on Twitter—they spread privately. Our Bitcoin ecosystem handles this well already.
Second, many key roles are held by Chinese—though not purely mainland-born. Some from Hong Kong, Taiwan-raised, US-educated—ABCs (American-born Chinese). They blend into Western culture, possess sharp edges to break through, strong product sense.
Examples: Jupiter’s founder is Malaysian-Chinese. SushiSwap’s PMs are ABCs. Uniswap and Paradigm partners include Chinese. These aren’t “pure local market” Chinese, but integration with them is too limited. Crucial crypto roles are already Chinese—often second or third generation. Many Bitcoin accelerator founders are ABCs long based in China. My interaction with them is seamless. We have chances to prove Western skeptics wrong.
They claim Chinese can’t build great L2s, robust middleware, massive TVL, $10B+ DeFi projects. This cycle is perfect to disprove them. Bitcoin lacks Ethereum-style orthodoxy. We Chinese may not be liked—jokingly. Orthodoxy is hard to claim—we don’t need to worship Luke. They lack influence here. Ultimately, products, growth, and data speak loudest on Bitcoin. Our cost, speed, efficiency, and opportunity-grabbing abilities offer real advantages. Indian unity is relative—success breeds survivorship bias. Sandeep once told me he dislikes most Indian projects—he fought his way out. Most Indians never reach center stage. My mindset stays positive. Indian cohesion is overstated. Sreeram wouldn’t succeed without Stanford. Azura (AAVE) might be nobody without being Polygon’s CTO. If we get one chance, one foothold, and support each other—this cycle holds opportunity.
BMAN: Over the past six months, many new asset protocols emerged—most recently, Runes. Within your respective ecosystems, do you have Rune-related strategies? What are your thoughts on Runes? Could it replace BRC-20 or achieve longer-term success?
CharlieHu: Personally, I’m bullish on Runes—despite its terrible UX. Casey’s been FUD-ed lately—his turn now. Joking aside, he’s a supremely confident German. His words on September 12 last year pushed me to realize Bitcoin L1 alone couldn’t progress—either off-chain scaling or L2 expansion was needed. I don’t take sides—domo has issues too. Both standard-setters add industry value—we respect them. But they have personal flaws—I’ll leave that aside. Runes is hot in the West—discussed intensely by degens and traders from Denver to Dubai.
On halving day, groups of Indians and Dubai residents used dozens of computers mining runes—skipping parties. Interesting—but many accidentally burned BTC due to operational errors. UX is terrible now—like last year. Watch closely—many explosive protocols haven’t emerged yet. Still early, exploratory phase. Many reserve tickers, preparing MEMEs—essentially MEME asset protocols. Casey’s influence is solid. He’s coming to Hong Kong hoping to find East-West consensus. XVerse pushed his visit—he remains distant from Asian culture and communities.
At Bitlayer, we’re doing two things. First, tooling: we’ll support runes on L2—boosting usability 100x, enhancing trading volume and liquidity. L1 offers limited capabilities and poorer UX. Moving to L2 promises better yields and experiences. We’re partnering with teams like RunesTerminal—their first overseas ecosystem partner announcement. We communicate closely. Many rune-related tooling projects emerged recently, seen in Dubai. But still early—no killer apps yet. Nothing breakout like last year’s Sats or Rats-level hits on BRC-20. I talk with teams successful in early inscriptions—they’re waiting, watching. Still tentative—no game-changers. Leonidas’ Runestone is promising but not enough—a good pilot.
Can early inscription pioneers—Chinese or Western—repeat success in runes? I’m skeptical. I hope new builders—with experience like Solv, strong product design, proven DeFi and NFT solutions from Ethereum—bring innovation to Bitcoin L1. Bitcoin’s ecosystem shouldn’t revolve only around figures like Leonidas. I’m actively recruiting seasoned builders from other ecosystems. Runes is an asset—consensus exists. Building strong applications and improving UX—that’s what matters.
Ryan Chow: From Solv’s view, as a DeFi-focused Bitcoin liquidity layer, we’re not directly involved in Runes (protocol-wise). Personally, I bought some. Overall, I’m less specialized than Charlie or Jeff here.
Let me share my thesis. I consulted Solana’s MEME scene supporters—asked about their current stance. Since Runes is a Western-originated, MEME-like asset, I inquired: Are you still active in Solana MEMEs? Thoughts on inscriptions, runes, BTC ecosystem? Feedback was very optimistic. They see Bitcoin’s MEME-like runes as highly imaginative. They’re bullish on Bitcoin-native assets. Many are shifting—moving half or more of their capital from Solana MEMEs to runes. A positive signal.
BMAN: I trade MEMEs too—feel the community’s enthusiasm gradually shifting toward Runes. Interesting.
Jeff: I’ll play devil’s advocate. Runes and BRC-20 are simply fungible token issuance protocols—like ERC-20. After ERC-20 launched, no one celebrated new fungible token protocols. Whether TRC-20 or BEP-20, they’re just alternative issuance standards. The excitement around Runes and BRC-20 stems from Bitcoin previously lacking any token issuance protocol.
So the shift from BRC-20 last year to runes this year draws attention—it feels novel, exciting. Normal. But long-term, I revise my earlier view. I thought Runes wouldn’t heavily impact BRC-20—but I was wrong. Why? First, quality BRC-20 tickers—those suitable for speculation—are dwindling. Runes’ longer naming space offers developers broader options. Second, pre-mint functionality changes project launch strategies significantly. Third, Runes is Western-led—early assets like RSIC and Runestone gain massive Western visibility. Other communities welcome and embrace them—buy in, stack. Momentum is strong.
Back to Bitcoin L2s—challenges and opportunities coexist. Today’s view: L1 users resist bridging runes to L2. Trading runes on L1 isn’t terribly inconvenient. Costs exist—but for popular coins, users accept paying $50 on a $3k–$5k trade. Among us—does anyone have a runes bridge live? We have runes internally—bridge not ready. Personally, I doubt L1 users today want to move runes to L2. It doesn’t hurt enough. Plus, inherent distrust of bridges—normal. Same with BRC-20—many won’t bridge to L2. Either the coin is dying—unsellable on L1 or L2—or it’s listed on exchanges, so they bridge there directly.
But opportunities exist: BRC-20 followed a path—Runes will too. Headline tokens surge, list on centralized exchanges, migrate off-chain. Like ORDI, SATS—now traded as MEMEs on exchanges. Chain users and exchange users barely overlap—full turnover occurs. The coin becomes an exchange token. Many large ORDI stakers never used Unisat—they bought entirely through exchanges.
Beyond top CEX-listed tokens, remaining coins face severe liquidity droughts. Mid- and low-tier coins struggle to gain traction on L1. Low trading efficiency, poor asset distribution—high initial friction. Launching a coin already costs millions—BRC-20 saw multiple projects spend $10M+. That cost burdens users. Secondary market liquidity must be exceptional to offset it and sustain price growth. Beyond ORDI and SATS—both down 50%+, some more—most BRC-20 communities face serious liquidity issues.
Where’s the L2 opportunity? Look at Solana or Base MEMEs—their issuance processes—crowdfunding, airdrops—are smooth, low-cost. Second, DeFi infrastructure—DEXs—are battle-tested. Proven optimal for issuance. Deploy a pool on L2—price can skyrocket quickly. It may crash fast too—we see it daily—but it can pump fast. Early MEMEs on Merlin rose extremely fast. Issuers realize: launching on L1 means paying $100k–$1M upfront, or burdening users with same. BRC-20 already proved this model inefficient. That could be L2’s rune opportunity. Of course, it’s early. We’re launching a runes incubator with OKX Ventures to explore.
Developers—Western or Asian—have much to build. If Runes repeats BRC-20’s path and L2s fail to assist or empower it, that would be unfortunate.
BMAN: Regarding opcodes, OP_CAT recently enables combining script fragments—enhancing UTXO composability. What impact could this have on Bitcoin’s ecosystem capabilities? Might it significantly influence future L2 development?
Jeff: Briefly, it could be transformative—but the timeline is long. Enabling limited smart contracts on Bitcoin helps the ecosystem, including L2s. But realistically, development cycles and cost structures mean short-term impact on our ecosystems may be minimal.
For Bitcoin L2s handling large funds, security is paramount. At our February launch, many questioned fund safety—deposit/withdrawal bugs. With massive funds on Merlin, hackers have strong incentives to attack.
How to address this? Seek balance among stability, security, and intelligent efficiency. Many rune bridge and inscription bridge projects we’ve reviewed—honestly—seem risky. A message to developers and listeners: if building rune bridges or chains, consider this. Currently, only Unisat indexes runes—everyone relies on one indexer. BRC-20 indexers occasionally have minor—not fatal—issues. But if a bridge’s liquidity mechanism depends entirely on L1 rune storage and instantaneous bridging, risks escalate. Our rune bridge is nearly done—delayed or instant? We chose three-day delay—fast for an official L2 bridge, though users may want faster. Many projects opt for instant bridges—delegating all decisions to machines. Without multi-indexer capability, if the indexer fails or bridge data deviates, machines execute incorrectly—potential bugs. Protocols and indexers remain imperfect. Casey fixed a bug pre-launch due to protocol/indexer flaws causing potential fund loss. Our chain holds tens of millions—$30–40M—of Doge runes. Premature tech deployment risks outweigh benefits. Stability and security must come first. Many projects pushing “real-time, instant” features concern me—my developer perspective.
CharlieHu: This reflects an interesting dynamic—or ideological split—within the Bitcoin community. The radical faction wants OP_CAT passed immediately, enabling currently impossible functions. But this poses security risks and may compromise Bitcoin’s core principles—strongly opposed by Bitcoin OGs and maximalists.
Recently, I noticed five core Bitcoin code maintainers—technical OGs—bypassing others to push this forward. Almost a community rebellion. This rebellion has merit. Expect developments before July’s US Bitcoin Conference.
For us building BitVM, our stance remains: BitVM’s strength lies in requiring no hard fork, no dependency on OP_CAT or BIPs. Using existing opcodes and scripting languages, proof systems may still be achievable.
Assuming no OP_CAT, no BIPs, Bitcoin can evolve without full network upgrades. Ethereum has politics, relationships, legitimacy questions—“Does Vitalik like you?” That’s Ethereum’s issue. Bitcoin has some too—but more decentralized. One person’s opinion—like Luke wanting to eliminate BRC-20—sparks debate. Arguments exist—for community benefit, ecosystem health. Consensus forms, disagreements arise, some possibilities collapse—but slowly.
I’m cautiously pessimistic about OP_CAT and BIP implementation. Does pushing them truly benefit Bitcoin’s ecosystem development? Questionable.
In Hong Kong, I’ll discuss with overseas investors and advisors: what comes next? These talks will set tones—directions for Bitcoin post-2024 halving. Between mid-May’s Hong Kong event and late-July’s US conference, watch closely.
Baiyu (CKB): First, L1 is in protocol competition—Runes is one such protocol. I see no fundamental change from BRC-20—just minor optimizations. That’s my core view. Of course, Casey contributed greatly—Ordinals’ historical significance is unshakable. Regarding OP_CAT or other opcodes, our team holds a simple belief: Bitcoin’s greatest strength is stability. We believe the best path is building without hard or soft forks. That’s why we proposed RGB++, using CKB as a smart contract platform.
Despite the downturn, I believe Bitcoin is the industry’s future—a free, innovative space. Eastern L2s, especially ABCDE-backed projects—EVM and UTXO-based—can pioneer unique paths, not chasing Western capital. We often say: CKB坚持UTXO, but differs ideologically from Western Bitcoin Maximalists. We’re like Eastern heretics—some philosophical divergence. I believe Eastern builders—and Western allies recognizing this path—can achieve much together. EVM赛道is strange—we’re ahead, yet ignored overseas. Everyone backs their own narratives—tells its own story.
Now is the time to strengthen confidence in Bitcoin’s ecosystem. Stop dividing by language or region. Such biases should be dropped. This is our best chance to build great public chains.
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