Bitcoin Ecological New Star Fractal: Innovation and Challenges Coexist

Since September, with the community frenzy triggered by Fractal, the market focus has once again shifted to the Bitcoin ecosystem. A large number of users are participating in the assets and gameplay launched by Fractal, leading to persistently high on-chain gas fees. There are three main reasons why Fractal can attract such great attention:

First of all, the overall market is currently sluggish and lacks fresh narratives. Secondly, based on Unisat's previous generous airdrop of Pizza, many users place a high value on the launch of Fractal, and even during the testnet phase, there was intense competition, with about tens of millions of addresses participating in related testing tasks to compete for airdrops. Finally, the high multiple return effects brought by asset protocols like Cat20, along with the continuous fermentation of the profit effect, further boosted the popularity of Fractal.

In addition, Unisat's official hunger marketing strategy has also played a role in boosting the situation. Originally, the circulation of the airdropped FB was very small, but as on-chain competition intensified, the price of FB skyrocketed, becoming a kind of "golden shovel" to some extent, indirectly accelerating the development of Fractal.

Based on the above reasons, it is particularly necessary to conduct an in-depth analysis of Fractal.

Overview of Fractal: Bitcoin's Native Scaling Solution

Fractal is a multi-layer scalability solution that is recursively expanded based on the Bitcoin core code. It is designed as a second-layer network or sidechain for Bitcoin, enhancing transaction efficiency by speeding up block generation and increasing block capacity while maintaining orthodoxy. Its working principle includes complete compatibility with the Bitcoin mainnet, while providing faster transaction confirmations, such as block generation in 30 seconds and a block capacity 20 times that of the Bitcoin mainnet.

As a native expansion solution, Fractal can start from the Bitcoin main chain to achieve secure asset transfers between layers. Bitcoin and assets like BRC-20 and Ordinals can be bridged through a decentralized bridge. The underlying mechanism uses dynamically replaced rotating MPC signatures, while also considering specific aspects of the BRC-20 standard.

Fractal is functionally more similar to the Bitcoin testnet, supporting some features that have not yet been activated on the mainnet in advance. It serves as an experimental ground, providing better user experience and performance optimization, making it very suitable for experimental innovation in complex applications. At the same time, it allows users to participate and provide feedback in a real interactive environment, similar to the significance of EVM layer 2 for Ethereum.

Investment and Financing: Strong Partnership to Promote Development

Fractal is developed in collaboration with UniSat and Block Space Force. UniSat, as the main developer, is a leading Bitcoin wallet with over 900,000 active users per week. It has received five rounds of undisclosed funding, with two rounds led by OKX and another exchange platform, and participation from Waterdrip Capital, ABCDE Capital, and others.

Block Space Force is a crypto-native fund with a portfolio that includes well-known projects such as Babylon, Pendle, and Aevo, boasting extensive experience in USD A9 exits and hundredfold return project investments. Overall, UniSat's resources are more prominent, with its successful brand and previous generous Pizza airdrop attracting a large number of loyal users, providing the best endorsement for Fractal.

With the support of resources from both parties, Fractal has implemented a series of strategic plans to initiate user and developer participation. After the mainnet launch, Fractal distributed 1 million FB tokens to over 100,000 eligible addresses and launched several developer resource funding programs, demonstrating its ambition for ecological development.

Fractal Highlights: Optimized Performance, Innovative Assets

The highlight of Fractal lies in the performance optimization and improvement based on the Bitcoin mainnet, as well as the innovative asset issuance method and ecological applications that have been launched. It can be metaphorically described as using the "old bottle" of Bitcoin mainnet resources to contain the "new wine" of a brand new asset issuance method. Specifically:

• Multi-layer expansion mechanism: Enhances transaction speed through recursive expansion layers, forming a tree structure and increasing parallel processing capability. Each layer can independently handle transactions and dynamically adjust the number of layers to cope with the load.
• Cadence Mining: Adopts the same PoW consensus as Bitcoin, allowing BTC miners to seamlessly switch mining and increase additional profits.
• OP_CAT: Introduces this opcode to enhance scripting capabilities, providing possibilities for complex applications and smart contracts.
• Asset Bridge: Achieve cross-chain transfer of assets such as BTC, BRC-20, Ordinals through decentralized bridges.
• Ecological Applications: Launched innovative protocols and applications such as CAT20 and BTCTerminal to enrich the ecosystem.

Token Economics

The Fractal mainnet mainly consumes two types of tokens: $FB as general gas and $SATS as exclusive gas for a certain DEX.

The total issuance is 210 million coins, distributed as follows:

• 50% for PoW mining
• 15% Ecosystem Treasury
• 15% Core Contributors
• 10% community subsidy
• 5% Pre-sale
• 5% Advisor

The tokens generated from mining can be circulated immediately, while other tokens have a lock-up mechanism. The private placement portion is locked for 6 months. The official has announced the addresses of various funds to achieve complete transparency.

Ecological Overview

( CAT20 The most popular protocol currently is Fractal, launched by CAT Protocol. Despite potential risks, community sentiment and KOL promotion have quickly made it popular, driving up the price of FB. Its innovation lies in the use of the OP_CAT opcode, providing flexible and composable rules that fit the Fractal ecosystem. Transactions are fully validated by miners, reducing reliance on indexers.

![Exploring the new favorite of BTC: Is Fractal an ecological revolution or just a follower?])https://img-cdn.gateio.im/webp-social/moments-171113404f3dd01032f937984fa6c8c2.webp(

) BTCTerminal The original RunesTerminal project has been renamed and restructured, integrating into the Fractal ecosystem. It provides a comprehensive trading market, supporting features such as checking Mint progress and wallet balances. AFB mining activity has been launched.

![Exploring the New Favorite of BTC: Is Fractal an Ecological Revolution or a Follower?]###https://img-cdn.gateio.im/webp-social/moments-2b583156ca830db2afaaedb3d9a017cf.webp(

) UniWorlds A metaverse project built on Fractal, developing virtual worlds and game toolkits. It is the first large-scale application developed by the UniSat team and has received seed round investment.

![Exploring the New Favorite BTC: Is Fractal an Ecological Revolution or a Follower?]###https://img-cdn.gateio.im/webp-social/moments-215dc211a973d39eaa4d37697f50b228.webp(

) BRC20 After the activation at block 21000, the on-chain gas remains high. However, the performance of leading projects is average, with a common occurrence of startup rounds or studio exclusivity. Future development still needs to be tested by the market.

![Exploring the new darling of BTC: Is Fractal an ecological revolution or a follower?]###https://img-cdn.gateio.im/webp-social/moments-ff7e5a78c42e9f206763af49887b9249.webp(

Considerations for Participating Groups

• Retail investors: Attracted by new narratives and high popularity, actively participating in the creation and speculation of new types of assets. There may be short-term profit opportunities.
• Miners: Can mine BTC and FB simultaneously, will benefit when the ecosystem develops well. After FB stabilizes in value, it may be the time to sell.
• Resource providers: The entry of large capital may promote ecological development, but it may also dominate market trends, potentially weakening the voice of retail investors.

Conclusion

The Fractal project has not many innovations, mainly focusing on compatibility and optimization of the mainnet. The ecosystem is still in the early development stage, and future development will still require time and market testing.

![Exploring BTC's New Favorite: Is Fractal an Ecological Revolution or a Follower?])https://img-cdn.gateio.im/webp-social/moments-ad144d0469c8335acbaf3d413983e1fd.webp###