Fractal Bitcoin Comprehensive Research Report

Summary

Fractal Bitcoin will be launched on September 9, 2024, and is an innovative Bitcoin scaling solution. It utilizes native Bitcoin code for recursive scaling, achieving full compatibility with the Bitcoin mainnet. This study aims to analyze in depth the core concepts, technical features, ecosystem development, and potential impact of the Fractal project.

Key Points

1. Innovative Mining Model: Fractal adopts a hybrid mining model that combines merged mining and free mining.

2. Bitcoin Testnet: Provides a testing environment for developers, supporting innovative features such as OP_CAT.

3. Built-in user base: Quickly gain a large number of active users through partnerships with OKX and UniSat.

4. Community-oriented strategy: adopt a pragmatic community-driven approach to avoid over-marketing.

5. Ecosystem Integration: Successfully integrated key participants in the Bitcoin ecosystem such as BRC-20, Ordinals, and Runes.

1. Introduction

Fractal Bitcoin is the first solution that recursively expands using the Bitcoin core code. It is built on the Bitcoin blockchain and aims to address the scalability and functionality enhancement issues of Bitcoin.

The Fractal mainnet officially launched on September 9, 2024. Within 24 hours, its joint mining accounted for over 40% of Bitcoin's total hash rate, with free mining accounting for 2%. Major mining pools such as F2Pool, Antpool, and Spiderpool have joined the Fractal ecosystem.

2. Core Concepts and Technologies

2.1 Native Bitcoin Scaling

Fractal maintains complete compatibility with the Bitcoin mainnet, achieving functional enhancements without affecting the core security model of Bitcoin.

2.2 Technical Specifications

• Block time: 30 seconds
• Mixed mining mechanism: 2/3 free mining, 1/3 joint mining
• Scalability: Theoretically supports infinite layer expansion, with each layer providing a 20x capacity increase.
• Smart Contract: Achieve Turing-complete smart contracts through OP_CAT
• Parallel Execution: Allows different applications to run independent optimized instances.
• Compatibility: 100% compatible with Bitcoin standards such as BRC-20 and Ordinals.

2.3 User Experience

The wallet address on Fractal is the same as the mainnet address, and users can easily switch networks in UniSat or OKX wallets.

3. The Position of Fractal in the Bitcoin Ecosystem

Comparison with Other Solutions 3.1

• EVM compatible Layer 2: Fractal adopts a native Bitcoin approach, which may be more favored by Bitcoin purists.
• Bitcoin Cash ( BCH ): Fractal does not create an independent chain, but rather extends Bitcoin locally.
• Lightning Network: Fractal provides comprehensive smart contract support without the need for channel management.

3.2 Market Strategy and User Base

• Relying on UniSat wallet with nearly 1 million weekly active users
• Focus on trading volume rather than TVL as the core metric.
• Comes with a user base to avoid the "cold start" problem

4. Ecosystem Construction

4.1 Decentralization Concept

• Encourage diversified cross-chain bridge solutions
• Open Development Environment
• Community-driven governance
• Distributed Infrastructure

4.2 User and Developer Launch Plan

• Distribute 1 million FB tokens to over 100,000 addresses
• Collaborate with OKX Wallet
• Developer Incentive Program

4.3 Funding Program

• Adopt a post-facto retrospective model
• Evaluation criteria include ecosystem contributions, technological innovations, etc.
• Supports diverse project types

4.4 Key Funding Project

• sCrypt: Enhanced scripting capabilities
• F2Pool: Provides mining support
• Nubit: Development of Data Availability Layer
• DeTrading: Supports trustless cross-chain swaps
• UniWorlds: Development Virtual World Toolkit
• FractalEcosystem.io: Community-driven project directory

4.5 Future Outlook

• Extended Funding Program
• Enhance community engagement
• Supports advanced DeFi, NFT, and other applications
• Develop scalable infrastructure
• Enhance cross-chain interoperability

5. Token Economics and Economic Models

5.1 Token Details

• Name: FB ( Fractal Bitcoin )
• Maximum Supply: 210 million
• Total Supply: 105,153,225
• Circulating Supply: 1,213,225
• Main use: transaction fees

5.2 Token Allocation

• Proof of Work Mining:50%
• Ecosystem Reserve Fund: 15%
• Community Reward: 10%
• Pre-sale: 5%
• Advisor Pool: 5%
• Core Contributors: 15%

5.3 Release and Lock-up Period

• Presale and core contributor tokens: 7 months lock-up, 12 months linear release
• Ecosystem reserve fund and community rewards: Up to 10% released each year for 10 years
• Advisor Token: Up to 20% released annually over 5 years

5.4 Governance Mechanism

The plan is to adopt a governance voting mechanism based on OP_CAT to enable community participation in decision-making.

6. Team and Partners

6.1 Core Contributors

• UniSat: Leading Bitcoin wallet with 900,000 weekly active users
• Block Space Force: Team members have experience from well-known projects such as Coinbase and CoinMarketCap.

6.2 Developer Platform Cooperation

Collaborate with the Scrypt team to jointly develop smart contract standards.

7. Challenges and Risks

• Programmability: Bitcoin scripts are relatively complex, which may hinder developer adoption.
• Technical Risk: Modifying the core parameters of Bitcoin may introduce vulnerabilities.
• Adoption barriers: Persuading users to migrate from existing solutions presents challenges.

8. Conclusion

Fractal Bitcoin demonstrates an innovative approach to extending Bitcoin's functionality, with advantages such as native integration, technological innovation, and a built-in user base. Despite facing challenges such as programmability and adoption, its strong support and early adoption show great potential. Fractal may reshape the utility and adoption landscape of Bitcoin, making it worth closely monitoring its developments.