Three Tracks from a First-Level Perspective: BTC, Solana, Restaking
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Three Tracks from a First-Level Perspective: BTC, Solana, Restaking
Restaking has probably been the hottest sector in the past six months, period.
Navigating Web3 tides with focused insightsAuthor: Lao Bai
A WeChat account I particularly enjoy, "Orange Book," recently published an article titled "Crypto Impotence."
"A terrifying boredom is spreading across the Crypto world, like the Black Death—no one knows where it started, but before you realize it, the disease is already everywhere."
Come to think of it, the industry lately indeed lacks any significant technical highlights worth writing about. The only trending topics have been memes like Pepe, Trump, and Jenner. The last notable tech-focused trend might have been Pandora, the dual nature of image tokens and coins?
The primary market has also been affected. Fortunately, innovation continues—though we still haven’t seen anything truly groundbreaking from 0 to 1, progress from 1 to 10 is ongoing across various sectors.
Last time, our report focused on new developments across layers under the modular narrative within the ETH ecosystem. This time, let’s turn our attention to BTC, Solana, and Restaking—three areas where meaningful “1 to 10” advancements are unfolding.
1. BTC
Many were expecting Rune to bring substantial excitement, but it hasn't lived up to the hype. If BRC20 or Ordi was a delightful chaos, Runes feels more like a collective ceremony—everything prepared in advance, just waiting for the (uplisting) wind. Yet, as the old saying goes, “what's hyped dies fast”—at least in the short term. In the long run, however, protocols like Runes, Atomicals, RGB & RGB++ still hold promise in revitalizing asset issuance on BTC. The recent upgrade of BRC20 two months ago clearly aims toward greater functional flexibility; for instance, creating native stablecoins based on BRC20 is now significantly easier.
Over the past two months, apart from the UTXO Stack I previously wrote about, the most noteworthy projects in the BTC ecosystem are likely Fractal -@fractal_bitcoin by Unisat, Arch Network - @ArchNtwrk, and Quarry - @QuarryBTC.
Fractal – features a very “peculiar” design philosophy. Essentially, you can view it as a 100% fork of BTC, but with block times reduced to 30 seconds.
You might ask—what is this thing? Isn’t this just a BTC testnet? At least Litecoin, BCH, and BSV have their own unique features; this is just a 99% mirror chain—what’s the point? How is security ensured?
Actually, there are several compelling reasons:
1. Fractal uses genuine POW, SHA256, just like BTC, with its own market cap and incentives—making it far more stable and faster than the BTC testnet (anyone who’s used the BTC testnet knows how unreliable it is), with blocks every 30 seconds.
2. It achieves 1/3 merged mining with the BTC mainnet (mainnet miners can mine a Fractal block every 90 seconds), theoretically offering 80–90% of BTC mainnet-level security.
3. Because it maintains 100% compatibility with BTC, all kinds of XXRC20 assets and infrastructure built on BTC can be seamlessly migrated over—without changing a single line of code.
4. It will implement controversial opcode proposals such as OP_CAT and native ZK verification opcodes faster than the BTC mainnet.
5. Thanks to point 4, it may eventually enable inscription-based contracts via script.
6. This idea might seem odd coming from others, but from Unisat, it feels perfectly fitting.
Arch – Compared to the increasingly tiresome wave of BTC EVM L2s and sidechains, Arch brings programmability to BTC through an indexer plus a decentralized prover-powered ZKVM. Think of it as a 1.5-layer solution: transactions are triggered on L1, execution logic (such as asset conversion) runs inside Arch’s ZKVM, then a ZK proof is generated and the result broadcast back to the BTC mainnet.
It reminds me somewhat of RGB++, both relying on BTC mainnet transactions as triggers. The difference is that RGB++ uses CKB Cell-based homogeneous binding, whereas Arch relies on an indexer + ZKVM.
Quarry – Turns BTC merged mining into infrastructure, essentially creating a miner or hash power version of the “OP Stack” + “EigenLayer.”
In simple terms, you can use Quarry to quickly launch a POW chain that performs merged mining with BTC miners, leveraging BTC’s hashrate for security. Token rewards go to participating miners—similar to EigenLayer’s AVS rewards. While EigenLayer or Babylon aim to capture staking security from BTC and ETH holders using POS, Quarry targets miners’ hash power security. However, in today’s POS-dominated landscape, it remains to be seen how much market share POW appchains can capture.
2. Solana
The most interesting development on Solana recently has been the concept of “modularization.”
As everyone knows, Ethereum has embraced modularity, while Solana has long stood as a flagship representative of the monolithic chain camp.
Yet over the past few months, I’ve discussed several projects aiming to bring modularity to Solana.
Examples include MagicBlock - @magicblock, Sonic - @SonicSVM, Solforge, Mantis - @mantis, among others.
MagicBlock promotes an Ephemeral (temporary) Rollup—designed to be “used and deleted, gone after reading.” This concept was first introduced around 2022 or 2023 by AltLayer, though it’s no longer AltLayer’s main selling point. As a project focused on a full-chain game engine for Solana, MagicBlock’s Ephemeral Rollup will likely form part of their broader solution.
Sonic focuses on Gaming Appchains on Solana and recently announced its funding round. Using a HyperGrid Framework architecture, it enables games to easily launch their own SVM Appchain. As the first example, Sonic could be seen as the XAI of Arbitrum?
Solforge aims to be a general-purpose Appchain stack, positioning itself as the SVM equivalent of OP Stack or Arbitrum Orbit.
Mantis is an intent-centric settlement layer built as an SVM Rollup. It doesn’t limit itself to serving only the Solana ecosystem—order book flows related to EVM can also settle on Mantis, since solvers naturally possess some degree of chain abstraction.
There are several interesting points worth observing:
1. Although Solana emphasizes high-performance monolithic architecture, reportedly after one game blew up earlier this year, its transactions accounted for as much as 20% of the entire chain—even when daily active users were only in the four- to five-digit range. One shudders to imagine what would happen if DAUs increased further, or if multiple similar game chains emerged—this potential strain may well be a key catalyst behind the growing interest in modularization within the Solana ecosystem.
2. Toly himself shifted from opposing modularity last year to appearing neutral this year—a change evident in his recent tweets.
3. Many at the Solana Foundation support modularity, and numerous developers believe modularization on Solana is inevitable.
4. Kyle from Multicoin has long been a staunch advocate for Solana and monolithic chains, and reportedly still opposes this modular direction.
Looking ahead 6–12 months, Solana’s infrastructure developments will be fascinating to watch. Beyond the rising narrative around modularity, the release of FireDancer’s lightweight version by year-end and its full version next year—which promise significant improvements in TPS and stability—are especially worth anticipating.
3. Restaking
Restaking has been the hottest sector over the past six months—period.
Yet I’ve noticed many people don’t fully understand the differences between the two leading players, Babylon and EigenLayer—even some project founders I’ve spoken with remain confused. So it’s worth clarifying.
Simply put, EigenLayer inherently supports smart contracts, enabling relatively complex slashing mechanisms. For example, the first AVS implementation, EigenDA, was made possible this way. You couldn’t replicate something like “BabylonDA” on Babylon because BTC’s native scripting capabilities can’t handle such complexity.
Conversely, Babylon boasts unique technologies like EOTS (Extractable One-Time Signatures) and the BTC timestamping protocol—features EigenLayer lacks. These give Babylon the edge to offer “native BTC restaking,” something EigenLayer simply cannot achieve.
However, this native BTC restaking has limited functionality, primarily covering two aspects: helping POS chains prevent Long Range Attacks via the BTC timestamping protocol, and assisting POS chains in establishing—or jumpstarting—their POS security consensus. In short: want to launch a chain? Come see me. Want to build a DApp? Head over to EigenLayer next door.
But could you forcibly use Babylon to create an AVS for something like EigenDA or an Oracle? The answer is “yes”—but you’d need an “expansion pack.” Projects like Chakra - @ChakraChain or SatLayer - @satlayer build atop Babylon, adding a layer of smart contract functionality to enable more sophisticated slashing mechanisms. With these, you can develop AVS-style DApps such as data availability, storage, or oracles.
Abstractly speaking, in terms of functionality alone: Babylon + Chakra/SatLayer = EigenLayer.
On the Babylon side, ecosystem projects beyond those trying to make Babylon as “complex” as EigenLayer include Solv Protocol and Lorenzo, which occupy similar LRT ecosystem roles as EtherFi and Renzo. On the EigenLayer side, due to its inherent “complexity,” the stack or “expansion packs” have evolved to a higher level—for instance, Ethos - @EthosStake provides an AVS coordination/interoperability layer, while Aethos - @aethosnetwork offers a programmable policy layer for AVS. As EigenLayer’s stack grows richer and infrastructure matures, it increasingly resembles AWS—eventually allowing users to simply click, drag, and assemble their desired “security tier + infrastructure suite,” then freely build either a new chain or DApps like storage or oracles on top.
P.S. Recently had a chat with a financial advisor who mentioned he’s talked to at least fifty or sixty VCs lately—some focused on infrastructure, others on gaming or Bitcoin—but there’s exactly one sector every single VC is looking at, without exception. Can you guess which one?
Answer: Ton…
However, investing on Ton is far more difficult than on ETH or Solana… Just imagine if Notcoin had approached VCs half a year ago with their pitch deck or demo—how many would’ve decided to go all-in?
If I get the chance, I’ll write about Ton in the next research report.
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Lao Bai
