The introduction of the Ordinals Protocol and its negative impact on congestion and high fees on the Bitcoin blockchain[1] has focused the crypto community's attention on Bitcoin Layer-2 solutions. Clearly, Ethereum Layer-2 solutions have worked extremely effectively and helped Ethereum users enjoy high speed and low fees[2].
Some Bitcoin Layer-2 solutions that have been operating stably such as Lightning Network, Stacks, Rootstock, Dovi, Liquid, Statechains[3] have gained more users and token price have increased, for example STX has increased 14 times from bottom price and approaching the old peak in 2021.
(https://www.tradingview.com/x/rfVsZyvZ/)
Recently, the Eos Layer-1 blockchain also plans to provide a Bitcoin Layer-2 solution[4], and Tron is no exception to this trend. Tron announced a three-phased plan for a Bitcoin Layer 2 solution aiming to boost interoperability, speed, and security across blockchains:
- Connect Tron and Bitcoin: Enable seamless interaction between the two networks, potentially injecting Tron's $55 billion stablecoin market into the Bitcoin ecosystem.
- Integrate Tron tokens: Facilitate smooth transactions between Tron tokens like TRX, USDT, and USDC on the Bitcoin blockchain.
- Collaborate with Layer 2 protocols: Partner with existing Bitcoin Layer 2 solutions to enhance the ecosystem and allow Tron users to participate in staking opportunities.
- Develop a novel solution: Create a unique Bitcoin-compatible protocol combining the speed and low fees of POS with the security of POW and UTXO models.
This ambitious roadmap, if successful, could significantly improve scalability and usability for both Tron and Bitcoin, paving the way for a more interconnected blockchain future[5].
To be honest, I'm not a developer and don't quite understand the feasibility of this plan. For me, although Tron is only famous thanks to TRC-20 USDT and a few dapps in the entertainment and betting fields, the TRX token price has been extremely well supported: TRX only dropped to Fibo 0.618 and is recovering extremely quickly with BTC from the end of 2022. TRX was once considered a failed token when it could not create a new ATH in 2021, but with this new plan, I hope TRX can return and enter the top 10 of Coinmarketcap.
(https://www.tradingview.com/x/6dpCMwwH/)
What do you think about this: is this Bitcoin Layer-2 solution really important for Bitcoin and Tron? Could it help Tron gain more users and get back into the blockchain race?
[1] Ordinals have brought digital spam to Bitcoin (https://cointelegraph.com/news/ordinals-put-digital-graffiti-bitcoin-blockchain)
[2] Best Layer 2 Crypto Networks (https://www.datawallet.com/crypto/best-layer-2-cryptos)
[3] Top Bitcoin Layer-2 Projects to Know in 2024 (https://www.kucoin.com/learn/crypto/top-bitcoin-layer-2-projects)
[4] Everything EOS Monthly Report – February 2024 (https://eosnetwork.com/blog/everything-eos-report-february-2024/)
[5] Tron’s Justin Sun Announces Plans for Bitcoin Layer 2 Solution (https://cryptopotato.com/trons-justin-sun-announces-plans-for-bitcoin-layer-2-solution/)