Author: Karen, Foresight News

Bitcoin has strong security, but liquidity constraints have always been a shackle to its development. Especially when Bitcoin is facing halving, miners' income will be significantly reduced, undoubtedly bringing considerable challenges to the entire Bitcoin ecosystem. In this context, Bitcoin L2 is expected to increase miners' income. So, what will happen when Bitcoin security is combined with EVM liquidity? Hybrid L2 BOB has provided its own solution, and through merged mining, Bitcoin miners only need to verify without additional PoW, and without bearing additional electricity costs, which may inject new vitality into the Bitcoin ecosystem.

What is BOB?

BOB stands for "Build on Bitcoin" and is an L2 technology stack aimed at supporting Bitcoin DeFi innovation and ecosystem development. It not only inherits Bitcoin's PoW security, supports the Bitcoin ecosystem such as Ordinals, Lightning, and Nostr, but is also fully compatible with EVM. Currently, BOB has been launched on the Ethereum testnet Sepolia and is planned to be launched on the mainnet before and after Bitcoin halving.

In terms of access, BOB supports users to interact with Bitcoin on the BOB network through the MetaMask Snap "BOB Bitcoin Snap". This means that users can transfer Bitcoin, sign Bitcoin transactions, engrave and transfer Ordinals, and other operations on MetaMask in the future. According to the BOB documentation, the BOB MetaMask Snap is currently undergoing formal review by MetaMask. BOB also allows users to pay Gas fees for cross-chain BTC and other ERC-20 tokens through meta-transactions and account abstraction.

BOB's co-founder Alexei Zamyatin is a Bitcoin enthusiast, researcher, and software developer, and also the co-founder of the Bitcoin DeFi project Interlay. As for the other co-founder mentioned by BOB, @domiki0_, the author has not found relevant information at the moment.

Yesterday, BOB announced the completion of a $10 million seed round of financing, with a lineup of investments including overseas venture capital companies focusing on Bitcoin, Bitcoin OGs, led by Castle Island Ventures, and other investors including Mechanism Ventures, CMS Ventures, Bankless Ventures, Alliance, Antalpha Ventures, Asymmetric, Bitcoin Frontier Fund, UTXO Management, Web3.com Ventures, Zee Prime Capital, ViaBTC Capital, Lucky Friday, Modular Capital, Daedalus, IOSG Ventures, Hypersphere, DFG, Nexo, and angel investors including Dan Held and the creator of the BRC-20 token standard, Domo.

How does BOB work?

Initially, BOB is launched on the OP stack and inherits Bitcoin's security through merged mining protocol (Bitcoin Proof of Reserves). Its ultimate goal is to settle directly on Bitcoin L1, and may later perform full-state verification through ZK Rollups.

In terms of technical implementation, BOB's merged mining protocol OptiMine follows a hybrid consensus model, allowing any sidechain or Rollup connected to the L1 chain to obtain PoW security from Bitcoin miners. OptiMine separates block production from Proof of Work (PoW), not only inheriting the security of Bitcoin miners, but also eliminating the reliance on centralized sorters, and maintaining fast block generation time (maintaining a 2-second block generation time).

Specifically, in the BOB merged mining protocol, the sorter is responsible for creating and signing blocks, while Bitcoin miners participating in merged mining on BOB L2 only perform verification. Since blocks are generated by the sorter and miners only perform verification, the sorter can stop block production in the worst case scenario, but will not create forks or invalid blocks, thus preventing attacks by Bitcoin miners.

In terms of EVM compatibility, BOB uses EVM to create and execute smart contracts, mainly developed using the Solidity smart contract programming language. Most of the Bitcoin stack and applications built around it, such as core SDK, Lightning, and Ordinals, are implemented in Rust, and BOB also supports Rust libraries for Bitcoin, allowing off-chain execution of Rust programs through RISC Zero zkVM, while using ZK proofs to verify the correct execution of EVM smart contracts. BOB stated that it will consider this as a way to directly perform ZK Rollups on Bitcoin in the future, where BOB itself can be proven in zkVM and verified through Bitcoin consensus.

In addition, BOB provides trustless access to Bitcoin block and transaction data through the BTC light client, allowing EVM contracts to process BTC transactions (such as P2P BTC exchange, Ordinal auctions, hash power tokenization, etc.), and supports a range of Bitcoin cross-chain bridges. BOB also plans to launch a bidirectional light client BTC bridge supported by BitVM.

BOB stack

BOB launches the first season of point activity

On the day of the financing announcement, BOB also announced the launch of the BOB Fusion first season point program to encourage users to actively participate and contribute to the construction of the BOB ecosystem. The first season activity allows users to lock assets and invite others within the non-custodial BOB Fusion time lock contract on the Ethereum mainnet to earn BOB Spice points. Points represent contributions to the BOB ecosystem.

In terms of asset locking, users can earn 1 Spice for every $1 worth of assets deposited daily. Depositing tBTC and WBTC assets can earn 1.5 times the points. Specifically, supported assets for deposit include:

1. Bitcoin-anchored assets: tBTC, WBTC (1.5 times the points);
2. Stablecoins and Ethereum liquidity staking tokens: DAI, eDLLR, rETH, STONE, USDC, USDT, wstETH (1.3 times the points);
3. ALEX, ETH, eSOV (1 times the points).

Friendly reminder: Do not directly withdraw funds from the exchange to the BOB FUSION smart contract address.

In addition to asset locking, users can earn more points through an invitation mechanism. After completing the initial deposit, users can generate a personal referral code to invite others to participate in the activity. The referrer can receive 15% of the Spice from the first-level invitee and 7% of the Spice from the second-level invitee.

The first season of BOB Fusion activity will end after the mainnet launch in April. At that time, the locked assets will be unlocked for withdrawal before and after Bitcoin halving, and can be migrated to the BOB mainnet to continue participating in the second season activity. According to the BOB official website, there are 25 days left until the end of the first season of point activity. If there is a delay in the mainnet launch, the assets will be automatically unlocked no later than May 15, 2024 (due to the use of a time lock contract).

BOB Roadmap

BOB has also released a detailed roadmap, showing multiple release stages from public testnet to Multi-ZK-Rollup. BOB L2 will be released in multiple stages, from Stage 0 to Stage 5, which are respectively the public testnet, Bootstrapping BOB: Optimistic ETH Rollup, inheriting Bitcoin security through a new merged mining protocol (PoW re-collateralization), upgrading from Optimistic Rollup to ZK verification, implementing BTC collateral sorters through BitVM, one-time signatures, and ZK proofs, and Multi-ZK-Rollup (simultaneously connecting ETH and BTC).

As mentioned earlier, initially, OB will use the OP stack to launch the Optimistic ETH Rollup, with BOB sorters processing transactions and blockchain, and then submitting data covering PoW commitments to Ethereum L1, where DA and PoW commitments are verified on Ethereum, and settlement also occurs on Ethereum L1. Due to the native L1/L2 cross-chain bridge, stablecoins (USDT, USDC), ETH/stETH, and ERC-20 assets can be accessed. BOB also tracks the status of Bitcoin through the BTC light client, verifies block headers, and accepts transactions containing proofs. This makes trustless cross-chain exchanges/auctions/contract executions possible.

It is worth emphasizing that compared to the standard OP stack, BOB has made many changes and optimizations, such as having its own governance to reach community decisions and implement changes, exploring alternative solutions for data availability beyond Ethereum (such as Bitcoin and Celestia), adding merged mining in a single centralized sorter setting, and adding the functionality for Bitcoin miners to verify sorter work.

In the second stage, BOB will introduce Bitcoin PoW security into ETH Rollup. After BOB sorters process transactions and blocks, Bitcoin miners will verify the state of the BOB Rollup, and only include commitments as part of PoW when the state transition is correct, minimizing trust in the sorter. The sorter then submits data covering PoW commitments, and finally Ethereum smart contracts verify DA and PoW commitments.

BOB's goal is to introduce Bitcoin as the settlement layer for BOB, which is currently under research. It may be necessary to introduce ZK compression to BOB, which is likely to be part of the fraud proof mechanism and may cooperate with ZK infrastructure providers (such as RISC Zero). BOB stated that its vision is to ensure that Bitcoin assets on Rollup are protected by Bitcoin, while ETH assets are protected by Ethereum.

Recently, BOB has also established a strategic partnership with the Bitcoin sidechain development platform Anduro launched by the crypto mining company Marathon Digital. LayerBank, IceCreamSwap, bitSmiley, and iZUMi Finance will also deploy applications on BOB.

In conclusion, as an innovative L2 technology stack, BOB not only inherits Bitcoin's security but is also compatible with EVM. With its launch on the mainnet and further feature enhancements, whether it can drive the Bitcoin L2 trend and become an important force in the Bitcoin DeFi field, promoting the development and prosperity of the entire ecosystem, remains to be seen.

References:

https://docs.gobob.xyz/docs/learn/bob-stack/merged-mining

https://bafybeifw722rqtgjxpkyvum2rzr3l6g4zje44m7oyjk26zlntmthvtgsra.ipfs.dweb.link/

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