Vitalik just gave us the future roadmap for Bitcoin Vitalik just released a new blog post about different types of L2s on Ethereum, and I think it has EVERYTHING to do with Bitcoin. Let me explain. Heterogeneity of L2s (L2s are differentiating from each other) Vitalik argues that we are gradually seeing more heterogeneity in L2s on Ethereum, meaning there isn’t a single kind of L2, rather there is a broad spectrum of L2s with different trade-offs. The trade-offs here can be best explained by the blockchain trilemma (coined by Vitalik himself), which states there is trade-off between three critical aspects of blockchain technology: security, scalability and decentralization. Some L2s are: 1. Slower, more expensive, and more secure. 2. Faster, cheaper, and have more trust assumptions. 3. In the middle for speed, cost, and security. Examples In some cases, these are L1s that have decided to become L2s (Polygon as an ETH sidechain progressively moving to Polygon 2.0 as an ETH L2 rollup). In other cases they are fully centralized systems wanting to decentralize pieces of their tech stack. And in other cases they are games/social media that want decentralization but don’t necessarily require high security. In each of these cases you want to make different trade-offs on the blockchain trilemma, meaning you want different solutions (or L2s) to do different things. 3 Types of L2s (it is actually more of a gradient) There are 3 main types of layer 2s that Vitalik talks about in his post: 1. Rollups 2. Validiums 3. Disconnected systems Rollups Rollups are the zero knowledge rollups we all know and love because you can always trustlessly bring the asset back to L1. Computation is proven via fraud proofs or validity proofs, and the entirety of the data is stored on the L1. We don’t have any zk rollups like this on Bitcoin yet because Bitcoin can’t verify validity proofs. But there are plenty of projects trying to do this well on ETH. These are generally expensive as you have full data availability on the L1 and you have to generate big expensive proofs. Validiums Validiums are a step down from rollups. In a Validium you store data off-chain somewhere else, and only store the proof on the L1. This means Validiums are much cheaper than Rollups, but they add an additional trust assumption of off-chain data storage. In the case of Validiums, if the off-chain data is lost, your assets could also be lost (*not stolen). In this model, the main cost is the proving cost. You offload the data storage costs but keep the proof generation costs. Disconnected A disconnected L2 is essentially a sidechain. You have a completely separate blockchain or server, you trust some multi-sig or group of people to keep your coins safe, and then you receive all of the benefits of a sidechain (faster txn speeds, cheaper costs, etc). Layer 2s Are a Spectrum Importantly, Vitalik points out this is a gradient not discrete categories. Meaning an L2 might fall right between Validiums and Rollups, or between a Disconnected L2 and a Validium. Another important aspect of L2s is their “connectedness” to the L1. Vitalik broke this down into two parts: 1. The security of withdrawing to Ethereum 2. The security of reading Ethereum These attributes also fit on a spectrum. Finally, he discussed the security spectrum, with security demanding on the left, to scale demanding on the right. So What Does This Have To Do With Bitcoin?? This has everything to do with Bitcoin. On Bitcoin we have: Ordinals, BRC-20, Counterparty, Stamps, SRC-20, Colored coins, ARC-20, Atomicals, TAP, PIPE, BRC-100, BRC-69, BRC-21, ORC-20, ORC-CASH, Runes, Runestone, BRC-721, Lightning Network, Taproot Assets, RGB, Omni, MVC, Libre, Chia, Babylon, Interlay, Liquid, Stacks, ICP, RSK, ETH, BitVM, Bitcoin Script, TapScript, DLCs, Drivechains, Sidechains, Spacechains, Spiderchains, Statechains, Softchains, Ark, Optimistic Rollups (kind of), Sovereign rollups (in development), ZK-Rollups (someday), and many many more. Bitcoin has a huge variety of interesting layers that can all be categorized using Vitalik’s simple L2 framework, including the spectrum from Rollup L2 to Validium L2 to Disconnected L2, how securely you can withdraw from the L1 and how securely you can read from the L1, and whether you are more security-demanding vs scale-demanding. All of these Bitcoin layers have trade-offs (well explained by the Blockchain trilemma), and explain why we are likely to see MANY layers continuing to be built on Bitcoin. Conclusion Vitalik just gave us the future roadmap for Bitcoin, and the future roadmap is a wild world of interesting Layer 2 solutions, all making different trade-offs to support different use cases, collectively increasing the decentralization of the Bitcoin Layer 2 ecosystem.