Title: Starknet’s Foray into Bitcoin Layer 2: A Game-Changing Move
Author: Haotian
Source: Author’s blog
Starknet’s recent announcement to enter the BTC Layer 2 domain has sparked discussions and raised several intriguing possibilities. Here are my thoughts on the matter:
1) The proposal for OP_CAT, which enables the combination and processing of multiple UTXO unlock script byte strings, holds the key to expanding the programmability of the Bitcoin mainnet. With OP_CAT as a foundation, Starknet can leverage its efficient STARK proof mechanism to batch transactions and perform ZK validity verification on the BTC mainnet.
However, the uncertainty surrounding the approval of OP_CAT poses challenges for Starknet’s ambitions in BTC Layer 2. Therefore, Starknet’s entry into BTC Layer 2 should be seen as a narrative direction rather than a concrete plan.
In theory, if OP_CAT is approved, not only Starknet but also other Ethereum-based Layer 2 solutions within the ZK-Rollup camp, such as BitVM, AVM, RGB, RGB++, and Lightning Network, will benefit from an “enhancement buff.” Whether Starknet’s expansion plan can gain an advantage remains to be seen.
2) Contrary to some views, I believe that Starknet’s decision to venture into BTC Layer 2 is a positive development for the overall BTC ecosystem. It will attract more attention from Western capital, thereby providing stronger support for the viability of BTC Layer 2.
Moreover, Starknet’s involvement at its level of influence could potentially facilitate the implementation of OP_CAT and increase the possibility of its success. Behind its high-profile move, there may be some capital operations taking place. Despite Bitcoin Core member Peter Todd’s public criticism, claiming that Starknet’s entry provides new reasons to oppose OP_CAT as it could have a disruptive impact on Bitcoin, I believe that it could bring bullish sentiment to BTC Layer 2 and attract developers aligned with Starknet’s ecosystem. This will contribute to the comprehensive growth of Starknet’s capabilities and attract more capital and developers to the BTC Layer 2 direction, serving as a symbol of progress.
3) I have previously discussed the trend of layer 2 projects gradually becoming more like layer 1 through the modularization of the data availability layer, execution layer, and even the settlement layer. Now, even Starknet, one of Ethereum’s most loyal Layer 2 projects, has announced its “defection,” not because it has grown beyond control, but because it is exploring new frontiers.
It is evident that with the introduction of OP-Rollup and ZK-Rollup strategies, the deployment of lightweight services such as “one-click chain launch” and “Rollup as a Service” has significantly reduced the cost and efficiency barriers for layer 2 chain issuance. However, the challenge lies in the fact that, with the increasing number of chains, the growth of ecosystem applications and users may not keep up.
To tackle this issue, Starknet has emphasized its technical scalability. In a recent article, Starknet claimed to have the highest TPS and reduced fees to $0.01, while also supporting parallel transaction processing. Additionally, Volition, its upcoming release, aims to further reduce the cost of data availability. However, these advancements alone may not generate significant market growth expectations. In comparison, if Starknet can extend its reach beyond the Ethereum mainnet to Bitcoin applications, the situation changes.
By breaking free from the constraints of the Ethereum mainnet, Starknet’s realm of possibilities expands beyond Layer 2. Its underlying ZK technology, parallel transaction processing, and Cario language provide a solid foundation for differentiation from other Layer 2 solutions.
In essence, for Layer 2 to become more like Layer 1, it requires a foundation of high-performance technology, which Starknet possesses. From this perspective, it is difficult for the market not to have higher expectations for Starknet. Who knows, one day Starknet might announce its transformation into a unified ZK layer or a ZK-based infrastructure for the entire blockchain environment.
In any case, once Starknet breaks free from the narrative constraints of Layer 2, its realm of possibilities will be vastly different.
