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ToggleExploring Bel2: Architecture and Functions in Blockchain
Bel2, which stands for Bitcoin-Elastos Layer 2, is an innovative technology designed to combine the unparalleled security of Bitcoin with the versatile world of smart contracts and decentralized applications (dApps). It enables Bitcoin to interact seamlessly with other blockchains, execute complex contracts, and power a variety of decentralized applications without compromising its underlying security.
Bel2 Vision and Mission
Bel2’s vision is to build a new global financial system based on Bitcoin, similar to the historical Bretton Woods system, but stronger and decentralized. The goal is to position Bitcoin as the financial settlement layer of the future (native Bitcoin settlement layer), just like gold has been in the past.
Bel2’s mission is to:
Achieve seamless interaction between Bitcoin and other blockchains.
Unleashing new possibilities for smart contracts and decentralized applications that leverage Bitcoin’s security and liquidity.
Providing Bitcoin holders with a safe and efficient way to participate in DeFi activities without compromising the integrity of their assets.
Build a more inclusive and accessible financial system that takes advantage of Bitcoin and smart contract platforms.
Bel2 architecture
Bel2’s architecture is designed to connect Bitcoin to other blockchain networks while maintaining Bitcoin’s fundamental principles of security and decentralization. The architecture consists of several key elements that work together to bridge Bitcoin to EVM-compatible chains. The following chart illustrates this:

Let’s break down these components and what they do:
zkBTC full nodes are specialized nodes that can run on ordinary hardware (even mobile phones).They provide full Bitcoin node functionality with the added benefit of zero-knowledge proofs. These nodes monitor the Bitcoin network and generate proofs of transactions.
Cairo circuits are used to generate and verify Bitcoin transaction proofs. It is crucial for building zero-knowledge proofs that can be verified on other chains, ensuring privacy and scalability in transaction verification.
The arbitration network (including arbitration nodes) is the core of the architecture. They facilitate the transfer of data and proofs between the Bitcoin network and other blockchains. Think of it as a control center that manages the flow of information across different blockchain ecosystems.
The EVM ZKP contract bridges Bitcoin transactions to EVM-compatible chains. It receives, processes and verifies zero-knowledge proofs of Bitcoin transactions, thereby integrating the value and security of Bitcoin into the world of smart contracts and decentralized finance.
The transaction validator contract is a smart contract deployed on the EVM compatible chain. It receives and processes requests to verify Bitcoin transactions and stores a list of verified transactions. This allows other contracts to know when a Bitcoin transaction is confirmed without knowing the complexities of the Bitcoin network.
The Bel2 SDK serves as a toolbox for developers, allowing them to build applications that leverage the capabilities of the Bel2 architecture. It simplifies the process of building dApps that can interact with Bitcoin and EVM-compatible chains.
collaborative working mechanism
The zkBTC full node uses Cairo circuits to monitor the Bitcoin network and establish transaction proofs. The quorum network then takes these proofs and forwards them to the EVM-compliant chain. On the EVM side, the EVM ZKP contract and the transaction validator contract work together to verify Bitcoin transactions without understanding the complexities of the Bitcoin network. The EVM ZKP contract specifically handles zero-knowledge proofs, ensuring efficient and privacy-preserving verification of Bitcoin transactions on the EVM chain.
Developers can use the Bel2 SDK to build dApps that leverage this bridge, opening up endless possibilities for Bitcoin in the fields of smart contracts and decentralized finance .Imagine using your Bitcoin as collateral for a loan on an Ethereum dApp, or using your Bitcoin to participate in yield farming without ever leaving the security of the Bitcoin network. This is the type of innovation that the Bel2 architecture enables.
The combination of these capabilities creates a powerful ecosystem in which Bitcoin can interact with smart contract platforms, enabling a wide range of applications while maintaining the highest level of security. By understanding these architectural elements and their interactions, you can understand how Bel2 expands the possibilities of Bitcoin, opening up new horizons for decentralized finance and blockchain interoperability.
Bel2’s core technology
Zero-knowledge proof (ZKP)
The functional core of Bel2 is zero-knowledge proof (ZKP).These encryption technologies allow Bitcoin transactions to be verified without revealing sensitive details. In the context of Bel2, ZKP is enabled:
Prove Bitcoin ownership without exposing private keys or transaction history.
Verify Bitcoin-related conditions in smart contracts on other networks.
Enhance user privacy while maintaining overall system transparency.
ZKP is a cryptographic method that allows a party to prove the authenticity of a statement without revealing any additional information. In Bel2, ZKP verifies Bitcoin transactions on other chains without exposing sensitive data, ensuring security and privacy.
zkBTC full node
The zkBTC full node is a Bel2 innovation that allows ordinary mobile phones to run Bitcoin full nodes using zero-knowledge proofs. This increases the decentralization and security of the Bitcoin network while improving accessibility. The zkBTC full node acts as a bridge between the Bitcoin network and the zero-knowledge proof system used in Bel2.These nodes monitor the Bitcoin blockchain and generate the proofs required for cross-chain operations.
arbitration network
The arbitration network is a key component of the Bel2 architecture that facilitates the flow of information and value between different blockchain networks. It enhances the decentralization and security of the Bel2 system by distributing the responsibility for information delivery and verification among multiple nodes. The network ensures that Bitcoin transaction data and proofs are transmitted and verified reliably, even in the face of single node failure or network outages.
smart contract
Smart contracts are self-executing contracts that write the terms of the agreement directly into the code. They run on blockchain networks (specifically Ethereum). Bel2 makes it possible to create smart contracts that can interact with Bitcoin in various ways:
Smart contracts can create and manage Bitcoin-backed tokens, enabling Bitcoin to be used as collateral in decentralized finance (DeFi) applications.
Smart contracts can initiate Bitcoin transactions based on specific conditions or events occurring on other blockchains.
Complex operations involving Bitcoin and multiple other cryptocurrencies can be coordinated through smart contracts on Bel2.
Bel2 features
Bel2 combines the security of Bitcoin with the programmability of smart contracts, creating a “smart” ecosystem that greatly expands the possibilities of Bitcoin.This opens up new opportunities for developers, users and the wider blockchain ecosystem, with Bitcoin-backed lending as a prime example of its potential.
Bitcoin mortgage loan
One of the most exciting applications for Bel2 is the ability to use Bitcoin as collateral for loans without moving it to a single point of failure (like BlockFi or Celcius).
Loan MVP Overview
Bel2’s peer-to-peer lending demo showcases a mortgage-like model of Bitcoin-backed lending:
Borrow stablecoins (such as USDC) using Bitcoin as collateral.
A fixed interest rate determined by the market.
Repayment is due and no liquidation will be carried out before the due date.
If the borrower defaults, the lender will receive additional Bitcoins.
StarBTC
StarBTC demonstrates the potential of Bel2 technology for Bitcoin-backed lending. Developed during the ETHGlobal hackathon, StarBTC is the first and only native Bitcoin lending protocol built on Cairo.
Use Bitcoin as loan collateral, remaining non-custodial and non-liquidating.
Leverage Bel2 and ZeroSync technology for safe and efficient operations.
Enabling other chains to leverage Bitcoin as the most trusted asset on the Bitcoin mainnet.
Demonstrating the practical application of Bel2 in creating DeFi solutions for Bitcoin.
Borrowing process and Repayment process, See link: flow chart https://docs.bel2.org/docs/introduction/use-cases
This system allows Bitcoin holders to gain liquidity without selling their Bitcoins or trusting a centralized platform. It combines the security of Bitcoin with the flexibility of DeFi.
Bitcoin Staking
Bel2 introduces the concept of native Bitcoin staking, allowing Bitcoin holders to earn rewards without giving up custody of their Bitcoins.
1.Users stake their Bitcoin directly from their own wallets.
2.Verify pledges using zero-knowledge proofs.
3.Stakeholders can earn rewards for supporting the Bel2 network.
4.Bitcoins remain on the main Bitcoin network, ensuring maximum security.
advantage
Earn passive income with Bitcoin.
Contribute to network security and decentralization.
Maintain full control and ownership of your Bitcoins.
Decentralized Exchange (DEX) Integration
Bel2 allows trustless exchange between Bitcoin and tokens on EVM-compatible chains, bringing Bitcoin into the world of decentralized exchanges.
exchange demo
The Bel2 exchange demo illustrates how users can exchange EVM tokens for Bitcoin (and vice versa) without an intermediary.
swap.bel2.org
Trustless exchange between Bitcoin and ERC20 tokens.
Verify Bitcoin transactions using the Bel2 ZKP service.
Proofs are automatically submitted for user convenience.
This demo shows how Bel2 can bring Bitcoin liquidity to decentralized exchanges, enhancing the overall liquidity and functionality of the DeFi ecosystem.
NFTs on Bitcoin
Currently, BeL2 does not support the creation, trading, or utilization of NFTs directly on the Bitcoin network. However, BeL2 aims to support the integration of Bitcoin Ordinals, BRC-20 tokens, and Runes systems in the future. This functionality is still under development.
Potential applications
Digital art and collectibles powered by the security of Bitcoin.
Tokenize real-world assets on the Bitcoin network.
A cross-chain NFT market that integrates Bitcoin-based NFTs.
Application prospects of Bel2
Bel2 has an ambitious roadmap to build a new global financial system based on Bitcoin. Here’s an overview of its planned developments in 2024:
Phase 1: Prototype Validation (Q2 2024)
Target
Verify Bitcoin transaction proofs for seamless interoperability.
key developments
Improved and optimized Cairo circuit for generating and verifying Bitcoin transaction proofs.
Enhance the EVM ZKP contract to effectively verify Bitcoin transactions.
Improved ZKP Bitcoin transaction validator for dApp integration.
Phase 2: Achieving decentralization (Q3 2024)
Target
Implement a pledge-based arbitration network using Bitcoin full nodes.
key developments
Launch the zkBTC full node network.
Build a quorum network to enhance security and decentralization.
Implement a light client verification solution to effectively verify Bitcoin transactions.
Phase 3: Ecosystem Development (Q4 2024)
Target
Build a Dapp ecosystem and enable Bitcoin to be used as collateral for loans and stablecoin issuance.
key developments
Expand partnerships and integrations with more DeFi platforms.
Introducing advanced features such as native Bitcoin staking.
Develop and release SDKs and developer tools to make it easier to integrate Bel2 technology.
Implement support for NFTs and inscriptions on Bitcoin.
long term vision
The ultimate goal of Bel2 is to establish it as the cornerstone of a new global financial system, similar to the historical Bretton Woods system, but stronger and decentralized.This includes:
Expanding the use of Bitcoin in DeFi applications.
Enhance interoperability between Bitcoin and other blockchain networks.
Develop more use cases to use Bitcoin as collateral for various financial instruments.
Continue to improve the security, efficiency and scalability of the Bel2 network.
Opening up new possibilities for creating and managing non-fungible tokens (NFTs) on the Bitcoin network, including support for Bitcoin Inscription.
Introducing native Bitcoin staking, allowing Bitcoin holders to earn rewards without giving up custody of their Bitcoins.
Establishing an arbitration network (a network of arbitrators) as the communication backbone of the Bel2 system will help ensure the security and efficiency of the system.
Summarize
Bel2 technology has transformative potential for integrating Bitcoin with decentralized finance and blockchain applications. By connecting Bitcoin with smart contract platforms and DeFi applications, Bel2 is paving the way for a more integrated, secure and versatile blockchain ecosystem. Whether you are a Bitcoin holder looking to maximize your assets, a DeFi enthusiast looking for new opportunities, or a developer building cross-chain applications, Bel2 offers innovative solutions that leverage Bitcoin’s advantages while extending its utility.
Bel2 is more than a technological innovation; it is a step towards a new global financial system. By making Bitcoin more versatile and interconnected with the rest of the financial system, Bel2 can play a key role in shaping a new, decentralized global financial architecture. This vision of a “New Bretton Woods” system based on Bitcoin has the potential to revolutionize international finance and provide a more stable, fair, and efficient foundation for the global economy.
Bel2 represents a major advancement in blockchain technology, combining the security of Bitcoin with the power of smart contracts. As we continue to explore and develop this technology, we can expect to see more innovative Bel2-based applications and use cases in the future.
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