As the inscription-driven wealth effect takes center stage, the market’s attention turns to BTC-related blockchains, including layer 2 networks and sidechains. Ethereum, with a market cap of $350 billion, sets an example, where layer 2 and DApp token valuations exceed a hundred billion dollars. With the bull market underway, numerous ecosystem projects emerge, likely leading to a manifold increase in valuations.

In contrast, BTC’s market cap has reached $1 trillion, but the combined valuation of its related projects is only in the tens of billions. This implies that the overall ecosystem has at least several times the current capacity, with the potential for several projects reaching tens-of-billion in market cap and countless others reaching billions.

However, due to limitations in performance and smart contract support, BTC’s main chain cannot bear an explosive ecosystem. As a result, hopes are placed on BTC-related networks, including layer 2 and sidechains. Following the inscription frenzy, numerous projects have surfaced, competing for dominance in the market. After all, the leading layer 2 networks on Ethereum boast a market cap of tens of billions.

Now, three contenders have emerged, one of which is BounceBit, created by the Bounce team. It signifies the first public blockchain dedicated to restaking on BTC.

BounceBit Overview

BounceBit’s standout feature is its innovative dual-token PoS staking system, securing assets by staking BTC tokens and the native tokens of the BounceBit network. The architecture of BounceBit is fully compatible with the Ethereum Virtual Machine (EVM) and Solidity language, enabling a seamless migration for numerous ETH projects to the BTC ecosystem.

The security of BTC assets poses a significant concern, directly impacting the participation of large BTC holders. Unlike Ethereum’s smart contract vulnerabilities, BTC’s security issues stem from its lack of native smart contract functionality. Many layer 2 solutions currently involve transferring assets to multi-signature wallets. However, fundamentally, project teams have the authority to directly move user assets. While larger projects may be deemed trustworthy, significant BTC holders may still have reservations, affecting overall asset participation. BounceBit presents a novel solution by adopting a CeFi custody of Mainnet Digital and Ceffu, with Ceffu being the exclusive institutional custody partner of Binance. This ensures the security of BTC assets through the asset management practices of centralized exchanges.

In late January, BounceBit initiated the Water Margin event, similar to the Blast deposit model. Both the Ethereum and BNB chains accept deposits. Supported tokens on the Ethereum network include WBTC, Auction, Mubi, and DAII. As of today, BounceBit has achieved a Total Value Locked (TVL) of $450 million.

BTC Restaking Mechanism

The core innovation of BounceBit is the BTC restaking mechanism. Simply put, the assets on the BounceBit chain can be divided into three layers.

In the blockchain space, BounceBit has introduced an innovative technology, the BTC restaking mechanism, which opens up a new path for the appreciation of Bitcoin assets. This mechanism covers three levels of asset management, providing a multi-dimensional income ecosystem for Bitcoin holders.

Firstly, at the foundational level, Bitcoin assets, as well as tokens like BTCB and WBTC on the BNB Chain, can be stored in CeFi custody of Mainnet Digital and Ceffu. Ceffu’s Mirror X technology ensures on-chain traceability and regular financial audits to maintain system integrity and trust.

Secondly, custodied Bitcoin can be converted into wrapped versions on the BounceBit chain. Here, Bitcoin transforms into so-called bounceBTC, which can be delegated to network node operators in exchange for stBTC or utilized directly in various applications.

The third layer involves the restaking of stBTC. Users can restake stBTC on other SSCs, such as sidechains, bridges, and oracles, or directly use it for various applications within the ecosystem. BounceBit’s compatibility with the Ethereum Virtual Machine (EVM) and Solidity programming language allows developers to effortlessly migrate their projects to this new ecosystem.

Triple Returns

Based on the above description, it becomes apparent that BounceBit generates simultaneous returns from both CeFi and DeFi. Users can earn CeFi profits while utilizing LSD for BTC staking and on-chain mining, a process referred to as “restaking” in the Bitcoin context. This ecosystem provides Bitcoin holders with triple returns: original CeFi profits, node operator rewards for staking BTC on the BounceBit chain, and potential returns from participating in on-chain applications and the Bounce Launchpad.

Daul-Token PoS Mechanism

BounceBit also adopts a unique dual-token Proof of Stake (PoS) mechanism, emphasizing the importance of Bitcoin assets in driving infrastructure. Unlike relying on existing Layer 2 solutions, BounceBit operates as an independent PoS Layer 1 network, securing the network through validator staking of both Bitcoin and BounceBit’s native tokens. This dual-token PoS architecture not only enhances the security of the network but also increases participant engagement.

BounceBit’s PoS architecture consists of 50 validators, evenly split into two parts: one for BTC stakers and the other for BounceBit token stakers. This dual-token system not only broadens the stakeholder base but also weaves an additional layer of flexibility and security into the network’s consensus structure. Establishing a dual-token secure system not only fortifies the network but also enhances Bitcoin’s intrinsic value by actively involving it in network validation and profit generation.

BounceBox

BounceBox is an on-chain Web3 domain acting as a central hub, allowing users to customize Web3 projects according to their specific needs by selecting various tools and components from the BounceBit application store. It empowers users to design, launch, and enjoy decentralized applications (dApps) within the BTC ecosystem.

BounceBox includes a comprehensive repository of Web3 components such as decentralized exchanges (DeX), initial DeX offering (IDO), and marketplaces, all subjected to security and efficiency reviews. Additionally, it incorporates auxiliary tools for robot prevention and artificial intelligence for customer service, along with necessary security plugins.

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