Conflux the new L1

Conflux to launch Bitcoin L2, testnet Conflux Network introduced an EVM-compatible layer-2 solution that can interact with Bitcoin amid growing interest in crypto’s largest blockchain. According to Conflux, users can move Bitcoin (BTC) and inscription-powered assets between its blockchain and Bitcoin’s ecosystem. The new L2 network will run atop the main Conflux chain and use BTC for gas fees while supporting Ethereum-based smart contracts via the Ethereum Virtual Machine (EVM) standard.

A mainnet is expected to roll out by May if all goes to plan. Before that, a testnet teased by the end of March will look to capture early users and developer activity. Conflux is a China-based layer-1 network that unites proof-of-stake and proof-of-work blockchain models in its operations. Its BTC L2 solution will also rely on a similar design to offer new dapps and products, a Jan. 18 blog post explained.

This paradigm shift unlocks new dimensions for Bitcoin’s utility, creating layers upon layers of interaction and application that extend beyond typical digital asset uses. By embracing BTC within our PoS protocol, which includes built-in staking mechanisms, holders can actively contribute to network security and governance on the Conflux platform.

Conflux blog post The BTC L2 will leverage hype surrounding inscriptions, ordinals, and BRC-20 tokens, a new crypto type introducing decentralized finance to Bitcoin. While contentious, such cryptocurrencies have gained popularity among participants, and this particular category has grown into a multi-billion dollar market. Additionally, the approval of U.S. spot BTC ETFs by the Securities and Exchange Commission is primed to attract considerable capital to Bitcoin and possibly its growing ecosystem. In the first few days of trading, trading volumes and inflows in the billions have already been recorded for these spot Bitcoin funds.