Bitcoin Layer 2 Bitlayer reaches $300 million valuation with new funding from Franklin Templeton and others
Bitlayer Labs has raised $11 million in a Series A funding round co-led by Franklin Templeton Digital Assets and ABCDE.The round brought the Bitcoin Layer 2 developer’s valuation to $300 million.
Bitlayer Labs, a Bitcoin BTC -1.13% Layer 2 network developer, has raised $11 million in a Series A funding round at a $300 million valuation.
Franklin Templeton Digital Assets and ABCDE, a crypto venture capital firm co-founded by Huobi co-founder Du Jun, co-led the round, Bitlayer Labs said Tuesday. Other investors included Framework Ventures, WAGMI Ventures, GSR Ventures, Flow Traders and FalconX. Angel investors, including DOMO, creator of BRC-20, and Brian Kang, co-founder of FactBlock KBW, also joined the round.
The round was structured as a simple agreement for future equity (SAFE) plus token warrants, Charlie Hu, co-founder of Bitlayer Labs, told The Block. Hu said that the $300 million valuation includes both equity and fully diluted token valuation, adding that Bitlayer Labs is the project's British Virgin Islands-based equity entity, while the Panama-based Bitlayer Foundation handles the token entity.
The Series A round brings Bitlayer Labs' total funding to date to $16 million. The project previously raised $5 million in seed funding in March of this year.
What is Bitlayer Labs?
Founded last October, Bitlayer Labs is building a Bitcoin Layer 2 network based on the Bitcoin Virtual Machine (BitVM) system, which offers Bitcoin-equivalent security. Bitlayer launched its mainnet V1 in April and claims to have an ecosystem of over 200 projects already. It is currently ranked the number one Bitcoin scaling project in terms of total value locked at over $550 million, according to DeFiLlama data .
"Our developer and ecosystem growth in 2024 has vastly outpaced any other project building in the Bitcoin Layer 2 space," Hu said. "The Bitlayer team emphasizes quick, seamless communication with, and deployment of, ecosystem projects, as well as valuable and unique networks, resources, and incentives for their integration."
Bitlayer now plans to launch the testnet of its mainnet V2 by the end of next month or early September, Hu said. "This version will have the world's first Bitcoin verification capability solution, enabling state transitions that happened in Layer 2 to be verified in Bitcoin Layer 1 through the BitVM approach the Bitlayer team is building on," Hu said. "This will be history-making, empowering the true native Bitcoin Layer 2 with different trust and security assumptions, achieving Bitcoin finality. Soon, we will launch the term feature called FinalityVM (this is a work in progress)," Hu added.
Bitlayer currently employs around 70 people, and Hu plans to hire a few senior positions to increase institutional adoption of the Layer 2 network and expand its global community.
Hu characterized Franklin Templeton 's investment in Bitlayer as significant as it is the traditional finance giant's first Bitcoin infrastructure investment. "There are major strategic synergies between Bitlayer and Franklin Templeton to explore the future of Bitcoin money market fund with on-chain Bitcoin financial yield products," Hu said. "Bitlayer, in the near future, will kick off our Bitlayer institution branding branch for all of these institutional engagement efforts."
Kevin Farrelly, managing principal of Franklin Templeton Digital Assets, said in a statement, "We believe that Bitlayer's unique approach and technology has the potential to unlock new use cases and opportunities for Bitcoin, and we look forward to exploring collaboration opportunities with our Bitcoin-focused financial products."
Bitlayer token launch
Bitlayer will also launch its own governance token called BTR, Hu said and noted that the token will have similar use cases to the Ethereum Layer 2 project Arbitrum's ARB token. He said Bitlayer validators would need "quite a big amount of BTR tokens" put into staking to access gas fee revenue sharing. Additionally, token holders will be able to participate in governance voting and network maintenance, he added.
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