Bitlayer, Bitcoin Layer-2 Startup, Secures $11 Million in Funding

Bitlayer has successfully raised $11 million in its series A funding round, with Franklin Templeton and ABCDE leading the investment, bringing the total funding for the Bitcoin-focused layer-2 solution to $16 million. The funding aims to expand the range of supported protocols within the ecosystem built on BitVM, a system that facilitates the execution of smart contracts on the Bitcoin network.

While the exact valuation of the company remains undisclosed, the infusion of fresh capital is set to accelerate Bitlayer’s progress in developing its Web3 platform, which functions on top of BitVM, enabling smart contracts within the Bitcoin ecosystem. BMAN, managing partner of ABCDE Capital, highlighted Bitlayer’s significant achievement of amassing over $500 million in total locked value across approximately 300 projects, emphasizing its crucial role in the Bitcoin network.

In a press release on Tuesday, BMAN noted that as Bitlayer achieves native verification on Bitcoin, it will become the first native Bitcoin layer-2 solution, marking a significant milestone in the history of Bitcoin. The company’s plans include expanding its ecosystem by supporting Web3 protocols tailored for its platform. Additionally, the funding will contribute to the development of Bitlayer’s Mainnet-V2, a Bitcoin-native rollup featuring a layer-2 state transition mechanism secured by a Bitcoin-friendly proof system that integrates ZK and fraud proofs.

In a separate development from February, Pantera Capital, a prominent crypto-focused venture capital firm, projected that the decentralized finance sector within the Bitcoin-based ecosystem could potentially amass hundreds of billions of dollars in liquidity through Web3 protocols. This forecast is based on the assumption that Bitcoin could capture a similar market share as Ethereum, where decentralized applications historically represented between 8% and 50% of its market capitalization, currently standing at around 25%. Pantera Capital estimates that Bitcoin could witness an inflow of approximately $225 billion in value.

Bitlayer’s funding round also received support from Stake Capital Group, WAGMI Ventures, Skyland Ventures, and GSR Ventures, among others. The backing from these entities underscores the growing interest and confidence in Bitlayer’s vision and technology within the crypto space.