🧐Project Research | GOAT Network - The first Bitcoin L2 that shares network equity and unleashes the potential of #BTC
Since the rise of the Ethereum Restaking ecosystem last year and the beginning of attention to the Bitcoin ecosystem, many BTC whales have discussed the topic of BTC L2. Many whales hold a large amount of Bitcoin and do not need to do anything extra. However, how to make their Bitcoin holdings generate better returns in addition to their own appreciation, and whether there are secure protocols that can unleash the potential of their Bitcoin holdings, has become a topic of discussion among whales. Whether Bitcoin can have security and sustainable protocols to make Bitcoin holdings generate income has become a topic of interest among whales. Obviously, BTC whales also have a strong demand for financial management, which will grow over time. According to incomplete statistics, the current market value of such BTC with untapped potential exceeds $850 billion. Therefore, the BTC L2 market actually has strong market demand and speculative characteristics, and once the capital behind BTC is leveraged, the chain market will be reshuffled.
1️⃣The historical evolution and ultimate goal of Bitcoin:
In an early article, "Casual Talk about Hayek, Nakamoto, and Bitcoin," Blue Fox wrote: On January 3, 2009, at 18:15:05, the genesis block of Bitcoin was born; Nakamoto inscribed on the genesis block: "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks." This sentence was the headline of The Times on that day, meaning: "On January 3, 2009, the Chancellor is on the brink of implementing a second emergency bailout for banks." At that time, the global economic crisis was happening, and Nakamoto seemingly casually quoted the headline of the article, but in essence, he pointed out the various criticisms of the current financial system, and also clearly defined the mission of Bitcoin: it aims to build a new monetary system in a completely different way to provide an alternative path to solve the economic crisis.
I personally strongly agree with Blue Fox's point of view: this is just its path, not its goal. The ultimate goal of #BTC is to open up possible directions for human economic development and build a new monetary system that can solve financial crises.
It is precisely because of this goal that Bitcoin is hated to the bone by sovereign states that live off the fat of the land by printing money, and has been viewed as a potential competitor by governments around the world since its birth. As Bridgewater Associates founder Dalio said, "The biggest risk of Bitcoin is that it is too successful."
With the recent rise, Bitcoin's market value has once again exceeded $1 trillion and continues to grow. So far, Bitcoin can be said to have succeeded halfway, but to achieve this goal, there is still a long way to go. Bitcoin needs to play games with miners, needs stronger consensus, needs to become popular and be used by more people, and all of this requires better development of the Bitcoin ecosystem.
2️⃣The historical inevitability of Bitcoin ecosystem development:
The "Bitcoin Ecosystem Layer: Unveiling the Curtain of the Trustless Financial Era" co-authored by the Spartan Group team and Kyle Ellicott reveals the major challenges and possible solutions for Bitcoin at present:
We can see that issues such as programming capabilities, technical scalability, and developer community cultural consistency are all problems that Bitcoin needs to solve one by one. Since the birth of Bitcoin, these issues have been hindering the development of the Bitcoin network and the underutilization of capital, resulting in a large amount of funds remaining dormant and poor liquidity, becoming "value storage."
In fact, in order for Bitcoin to open up possible directions for human economic development and build a new monetary system that can solve financial crises, it must have better liquidity, rather than being like gold, which is kept at home after people buy it.
To activate these dormant funds, it is crucial to fully utilize the potential and capabilities of the Bitcoin network.
The development of the Bitcoin ecosystem is the inevitable result of historical development.
3️⃣What problems does Bitcoin Layer 2 need to solve?
The biggest problem with Bitcoin mentioned earlier is that it is not Turing complete itself, and the lack of support for smart contract features limits the development of more complex ecosystem businesses for Bitcoin.
After protocols and standards such as Ordinals, BRC-20, and Atomicals came out, the issuance of assets on the Bitcoin chain is no longer a problem. The current pain point has become how to create more application scenarios or more gameplay for these assets. Or, how to make Bitcoin have higher security and sustainable income!
The BTC network needs ecological empowerment. Rich on-chain activities not only bring economic benefits to miners, compensating for losses after halving, but also increase the number of full nodes, thereby increasing network security. More importantly, it allows more people to truly understand and use BTC.
However, it must be clear that due to the Turing incompleteness of BTC, no BTC L2 can fully inherit the security of BTC like ETH L2, regardless of the solution.
Therefore, BTC L2 must make trade-offs, as there is a strong market demand among BTC holders. Whoever can meet their needs, achieve a balance in security, and develop the BTC L2 ecosystem first, and continuously improve the security ratio, can also directly integrate better technical solutions in the future.
The BTC L2 track is a typical case of market demand driving technical solutions, and as capital density increases, the security ratio will continue to improve.
In this way, Bitcoin's positioning can gradually surpass the commonly assumed role of being merely a "store of value (SoV)" and steadily become the foundational technology platform for building a "trustless financial system" as it was originally envisioned.
When choosing BTC L2, one can refer to the BTC security inheritance ratio as an indicator.
4️⃣Introduction to the GOAT Network project
GOAT Network is a second-layer solution based on Bitcoin, aimed at providing income-generating opportunities for Bitcoin holders.
GOAT Network is led by Redouane Elkamhi and is the first decentralized Bitcoin L2 that shares network ownership.
Redouane Elkamhi, the head of GOAT economics, is a finance professor at the Rotman School of Management at the University of Toronto. Dr. Elkamhi has served as an advisor to TradFi and Web3 companies, including KPMG & EYnews. He focuses on strategic asset allocation, fund management, and DeFi.
He is leading GOAT to provide sustainable income for everyone from decentralized sequencers to small BTC holders.
Because it has launched the first L2 decentralized sequencer, Metis has achieved a significant increase in this round. The main reason is that the decentralized sequencer is not just a technical issue, but also a matter of interest, so L2s are currently hesitant on this issue.
GOAT Network was designed with modularity in mind, including GOAT Federation, GOAT Nodes, Decentralized Sequencer, Proof Network, and Relayer, among others.
GOAT Network also inherits the spirit of Metis in sharing interests and becomes the first Bitcoin L2 network to share network ownership through a decentralized sequencer.
I have always adhered to the view that every chain is an economic entity, and only by continuously decentralizing power can sustained economic activity be brought about.
5️⃣Security of GOAT Network
GOAT Network aims to address two major challenges related to Bitcoin expansion: security and sustainable income.
When it comes to BTC L2, security is the primary consideration. GOAT Network applies an enhanced version of Bitcoin time locks and one-time signature technology (also used by Babylon) to protect locked BTC assets.
In the Bitcoin second layer (Layer 2), zkVM is applied along with a decentralized sequencer to verify, challenge, and ensure the security of on-chain transactions.
Then, based on BTC script locking and one-time signature mechanism, the decentralization of the Sequencer is achieved, further consolidating the security trust mechanism.
It is worth emphasizing that currently, no BTC L2 can fully inherit the security of BTC among those that can be implemented, only relative security and balance, but with technological iterations, it will approach 100% indefinitely.
GOAT Network allows anyone holding Bitcoin to lock and become a node, or delegate their Bitcoin to existing Sequencer nodes through its decentralized Sequencer network.
This permissionless mechanism means that no entity can control the entire network, maintaining the decentralized nature of the network.
In terms of economic sustainability, the permissionless Sequencer network and wide diversity of participants ensure that no single entity has control over the entire network, enhancing decentralization and bringing about a more resilient network economy.
In short, GOAT Network proposes a decentralized and secure Bitcoin Layer 2 solution based on the native security mechanism of BTC script locking provided by Optimistic Challenge Proof (OCP) and the unified liquidity settlement layer provided by ZKM Entangled Rollup.
6️⃣ Another way out for Bitcoin holders
As mentioned earlier, as a #BTC HOLDER, security must be the top priority, and generating income is not the most important thing. The most important thing is whether one has control over their Bitcoin and whether their Bitcoin can generate income safely.
GOAT Network promotes broad and diverse participation by allowing any Bitcoin holder to participate directly or through delegation, regardless of their resources or technical expertise.
This inclusive mechanism enhances the network's resilience and decentralization, ensuring that no single entity has control over the entire network.
Therefore, the decentralized nature of GOAT Network ensures that no single entity has control over the entire network, enhancing the network's resilience and decentralization.
7️⃣ Token Economics of GOAT
The total supply of GOAT will reach 1 billion tokens, with 42% of the GOAT token supply allocated to Sequencer mining and community mining, providing income for node operators and participants who lock their Bitcoin in the network.
Additionally, 6% is allocated for airdrop activities, and 1% for Key Opinion Leaders (KOL), meaning that 49% of the total supply of GOAT will be allocated to community contributors.
Before the mainnet launch, GOAT Network has also launched the "GOAT Club" reward program, providing future rewards for Bitcoin holders who hold 0.001 BTC or more and are whitelisted, first-day DAPP release partners, and Sequencer node operators who lock Bitcoin to protect network security.
8️⃣ Conclusion:
The decentralized sequencer earns BTC gas fees and GOAT token mining rewards by generating blocks and providing secure and round-the-clock activity in the form of Gas fees for BTC and mining rewards in the form of GOAT tokens, opening the door for node operators, builders, BTC whales, and even small holders to participate in sequencer operations and generate sustainable income.
This structure also creates an innovative BTC bond market by tokenizing the income of the decentralized sequencer.
Currently, the entire BTC L2 market is in a quiet period. After the launch of Merlin and other BTC L2s, the entire market is quite disappointed. This is not only Merlin's problem but also the lack of narrative power in the entire market.
However, regardless, compared to other ecosystems, BTC L2 does have more room for imagination. Its narrative flexibility is better, and it can still be tracked as a potential track for the long term.
GOAT Network is planned to launch as a Bitcoin Layer 2 network in the fall of 2024, making it the first Bitcoin L2 network to share network ownership through a decentralized sequencer. Stay tuned—
9️⃣ Related activities:
Before the mainnet launch, GOAT Network has also launched the "GOAT Club" reward program, providing future rewards for Bitcoin holders who hold 0.001 BTC or more and are whitelisted, first-day DAPP release partners, and Sequencer node operators who lock Bitcoin to protect network security.
Currently, there is a relatively simple activity—
1) Follow @GOATRollup on Twitter and join TG
2) Invite friends, both parties can receive a 10% bonus in points as a reward, and if there is no invitation code, you can use: nzoj2y
3) Participate in the #GOAT Sequencer staking, stake your #BTC, with a minimum of 0.001 BTC to participate.
The project is still in its early stages, and everyone can voluntarily participate in the activities.
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