Dialogue GOAT Network: Launching the first BitVM2 testnet, igniting Bitcoin's "OP moment"

Guest: GOAT Network

Interview: momo, ChainCatcher

After several rounds of market discussions and reflections, Bitcoin Layer 2 may be transitioning from "conceptual narrative" to "engineering inflection point."

Recently, the Bitcoin Layer 2 network GOAT Network launched the GOAT BitVM2 testnet, which is the first BitVM2 testnet to go live globally.

Building on the advantages of the original BitVM2 protocol, GOAT Network has proposed multiple innovations that systematically address key issues in security, challenge mechanisms, and economic incentives, laying the foundation for the expansion and programmability of the Bitcoin ecosystem.

One key breakthrough is that GOAT Network has reduced the challenge period, which affects computational efficiency and coordination costs, from 14 days to 1 day, significantly improving capital utilization and user experience.

Stephen Duan, a core contributor to GOAT Network, stated that Ethereum L2 experienced an explosion after the Optimistic Rollup model was successfully implemented, and Bitcoin also needs its own "OP moment." The launch of the GOAT BitVM2 testnet signifies that Bitcoin ZK-Rollup is being pushed towards practical implementation, and Bitcoin's "OP moment" is about to begin.

In a recent interview with ChainCatcher, the GOAT Network team shared in detail their technological breakthroughs, ecological layout, and long-term vision.

GOAT stated that in addition to further optimizing the GOAT BitVM2 solution, the team is also actively following up on other promising Bitcoin ZK-Rollup solutions and exploring BTCFi products that cater to different risk preferences to enrich the on-chain ecosystem. GOAT Network will gradually evolve from a core infrastructure in the Bitcoin ecosystem to a liquidity center in the blockchain.

GOAT's "Anti-Mainstream" Route

1. ChainCatcher: What was the impetus for founding GOAT Network?

Stephen Duan: When we realized the profound impact of zkVM on the blockchain industry, especially regarding the challenges of unified consensus and liquidity fragmentation, we decided to go all in on zkMIPS in 2023.

zkMIPS is a zero-knowledge virtual machine developed by the ZKM team based on the MIPS32r2 instruction set. Unlike mainstream zkVMs based on RISC-V, it introduces a more mature, simpler, and efficient architectural design that is better suited for verifiable computing needs.

Choosing MIPS32r2, although a more challenging path compared to the mainstream RISC-V route, is seen as a necessary step to build the optimal verifiable computing zkVM.

Once this technical direction was determined, we needed to consider its scenarios and applications. Given that the Proof Market requires a strong application ecosystem, we believed we needed to take control of our future rather than rely on the uncertain demands of third parties to build our business model.

Therefore, we did not choose the B2B strategy adopted by most zkVM projects, which only serve as a bottom-layer technology provider. Instead, we opted for a bottom-up, vertically integrated approach, selecting the scenarios that most need ZKP to build our zkMIPS use cases, leading to the birth of GOAT Network ------ Bitcoin ZK-Rollup.

2. ChainCatcher: It seems that GOAT Network has adopted quite a few "anti-mainstream" strategies in its strategic choices. What is the underlying value judgment?

Stephen Duan: Yes, besides the earlier mentioned choice of MIPS based on commercialization considerations, abandoning the uncertain B2B model, and opting for vertical integration, GOAT Network may also appear "alternative" in other aspects.

For example, we have postponed business development (BD) and marketing. We believe that investing in BD and marketing too early before the product matures is irresponsible to our partners, as it may damage the brand due to product unavailability.

While the industry generally opts for a centralized Sequencer route, we have improved the BitVM2 technical solution and economic model, integrating zkMIPS and decentralized Sequencer to achieve native security for Bitcoin Layer 2 and return Layer 2 profits to contributors.

Additionally, we are not only pursuing a technical narrative but have chosen a dual-spiral development of technology and economic models. We believe that technology drives initial business, while the economic model determines long-term development.

At a time when the industry is pessimistic about BTCFi, we remain bullish on Bitcoin Layer 2 and BTCFi, continuously ignoring the noise and striving to promote the real implementation of BTCFi.

Our strategic choice is not a single-point breakthrough but a systematic layout, hoping to drive a complete ecosystem through the dual engines of technology and economy.

Bitcoin's "OP Moment" is About to Begin

3. ChainCatcher: Bitcoin Layer 2 has indeed been questioned about whether it can inherit the security of Layer 1, and existing solutions have mostly fallen short of expectations. What do you think the common challenges are?

Stephen Duan: Just as Ethereum L2 experienced an explosion after the Optimistic Rollup model was successfully implemented, Bitcoin also needs its own "OP moment."

Due to the limitations of Bitcoin's scripting language and the extremely high demands of users for native security, achieving "truly native" Layer 2 security has always been problematic, leading to skepticism within the community.

Currently, the reality is that most Bitcoin Layer 2 solutions are still sidechain models. While sidechains can expand functionality, their security relies on their own mechanisms and cannot fully inherit the strong security of the Bitcoin main chain.

There are currently two viable technical routes: OPCAT and BitVM2. OPCAT requires modifications to the mainnet script, touching the fundamentalist bottom line and progressing slowly; BitVM2 does not require protocol modifications and is easier to implement with the OCP model.

But with our breakthroughs in BitVM2 technology, we believe this technical challenge will gradually be resolved, and Bitcoin's "OP moment" is about to begin.

4. ChainCatcher: It sounds like BitVM2 is the better choice. BitVM2 was proposed in 2024, but why has it not been implemented yet?

Stephen Duan: During the process of using the BitVM2 solution, we discovered some critical issues when BitVM2 is used for production-level cross-chain bridges:

Operator Double-Spending Attack: Currently, BitVM2 allows operators to submit verifiable but actually fraudulent states (e.g., from a forked chain), which may trigger the risk of double-spending when users withdraw funds.

Inefficient Challenge Process: The existing mechanism adopts a one-to-one (staking, challenge) relationship, and the challenge period is lengthy, leading to high computational and coordination costs. At the same time, it does not support flexible withdrawal amounts, reducing capital utilization and user experience.

Lack of Effective Incentive Mechanisms: In the traditional BitVM2 architecture, the Rollup system includes various roles such as Sequencer, Challenger, Operator, and Committee members. However, the protocol lacks effective incentives to drive participation from various roles in the Rollup ecosystem, especially since challengers often do not receive rewards, leading to insufficient willingness to initiate challenges honestly and promptly. In systems relying on crowdfunding incentives, there may also be issues with rewards being allocated to the wrong participants, further undermining the accuracy and effectiveness of incentives.

The emergence of GOAT BitVM2 is precisely to address these deficiencies; it can be considered an enhanced version of BitVM2. Building on the advantages of the original BitVM2 protocol, GOAT BitVM2 has fundamentally improved three mechanisms, systematically addressing key issues in security, challenge mechanisms, and economic incentives.

The technological breakthroughs of GOAT BitVM2 can be said to advance BitVM2 from a theoretical model to engineering practice. Similar to how Ethereum's Optimistic Rollup drove the explosion of Layer 2, GOAT BitVM2 is expected to accelerate the market implementation of Bitcoin zkRollup and promote the arrival of Bitcoin's "OP moment."

5. ChainCatcher: Specifically, how does GOAT address the aforementioned issues?

Stephen Duan: Regarding the double-spending attack issue, we verify the consensus of Layer 2, and GOAT combines the Bitcoin Light Client mechanism to prevent double-spending.

To enhance withdrawal efficiency, we achieve arbitrary amount withdrawals through atomic swaps + Operator reimbursements. The original protocol typically required 1-2 weeks to complete a withdrawal, but we can compress any user's withdrawal to be completed within 1 day.

In terms of ZKP efficiency breakthroughs, zkMIPS allows GOAT to achieve real-time ZKP generation, ensuring that after each withdrawal trigger, the Operator can immediately initiate the reimbursement process.

Once in the reimbursement phase, based on a multi-round randomized challenge model, a corresponding Challenger is randomly selected to challenge.

After a limited number of challenges, such as 3-5 rounds, it can ensure with high probability that an honest challenger appears. Each round is completed within 1-2 hours, and the entire process can generally be completed within 1 day.

If someone initiates a challenge, the subsequent steps involve the Operator revealing the computation process and the Challenger disputing the erroneous computation points. This stage also requires an additional 30-90 minutes to complete.

Since the Operator is reimbursing themselves, they are always online, ensuring the smoothness and timeliness of the entire process.

6. ChainCatcher: What improvements have been made to the incentive mechanism?

Stephen Duan: In terms of the incentive mechanism, GOAT Network's core innovation lies in unifying the roles of Sequencer, Challenger, Operator, and Committee members into a single identity ------ Universal Operator, and through a role rotation mechanism, all participants take turns assuming different responsibilities at different times. All operators must stake in Layer 2, and each round will be assigned to a specific role.

In this model, GOAT Network can ensure a balance between operator profits and costs, incentivizing operators to participate honestly in any role; additionally, it lowers the participation threshold, allowing small and medium nodes to engage without continuously bearing high-cost roles, thus enhancing the system's decentralization and openness. It also increases system resilience, as even if individual operators go offline, the system can continue to operate through flexible role allocation, avoiding reliance on single points of failure.

7. ChainCatcher: What security issues are currently prevalent in Bitcoin Layer 2?

Stephen Duan: Security issues can be broken down into three aspects:

First is the liveness of Layer 2 itself. Simply put, liveness refers to whether the Layer 2 system can continue to operate normally without being halted due to node failures or malicious actions.

Second is the verifiability of Layer 2 computations and data. If the computation results of Layer 2 are not trustworthy or cannot be verified on BTC, users may face risks of fund tampering or double-spending (spending the same money twice).

Third is effectiveness. If the system is inefficient, user experience is poor, or the incentive mechanism is poorly designed, nodes may not participate, and the system cannot be maintained in the long term.

8. ChainCatcher: What advantages does GOAT have in addressing the aforementioned security issues?

Stephen Duan: In terms of liveness, GOAT's Sequencer is designed to be decentralized and permissionless from the outset. Anyone can run a Sequencer node and participate in transaction ordering. This means there is no single point of failure, and there is no need to trust a centralized entity, ensuring that the system can continue to operate with guaranteed liveness.

In terms of verifiability, GOAT BitVM2 addresses this issue from multiple angles:

Preventing Operator double-spending attacks: To achieve verifiable Layer 2 states, the decentralized Sequencer network periodically publishes the Sequencer public key set to the Bitcoin mainnet and uses it as public input for Layer 2 state validity proof (with the help of the Bitcoin Light Client listening mechanism). In the corresponding circuit (constraining the proof submitted by the Operator), it verifies that the latest Layer 2 block is obtained through consensus, and then further verifies that the state transitions of the block are correct, thus completing the final confirmation of the latest Layer 2 state.

Verifying the legality of the Operator's reimbursement corresponding to the destruction transaction on Layer 2: GOAT BitVM2 verifies through SPV that the destruction transaction is included in the aforementioned block and that the corresponding destruction state identifier is correct.

Replacing Peg-out transactions: GOAT BitVM2 replaces the Peg-out transactions in the original protocol with Layer 2 destruction transactions, allowing the Operator to directly initiate reimbursement by first destroying the pegged BTC on Layer 2 and then initiating reimbursement to Bitcoin Layer 1. This reduces the additional Superblock verification required for Peg-out, making the protocol more secure.

Challenge stakes provided by the Committee: No longer relying on crowdfunding, the reward addresses are preset during the Peg-in phase to ensure that challengers can receive rewards, preventing them from exiting challenges due to the inability to obtain rewards.

In terms of effectiveness, the Operators in GOAT BitVM2 can generate reimbursement proofs in a timely manner based on zkMIPS, controlling the time taken for proof generation to under 40 seconds, greatly enhancing the capital utilization efficiency for Operators.

The introduction of a multi-round random challenge mechanism is based on a cryptographic lottery scheme, randomly selecting challengers from all challengers, and incorporating decentralized sequencers into the challenger pool, which can reduce the overall reimbursement time to under 1 day.

9. ChainCatcher: What is the current progress of GOAT Network's BitVM2 solution? Are there any noteworthy updates?

Stephen Duan: Our GOAT BitVM2 testnet has gone live, being the world's first BitVM2 testnet. We are also publicly recruiting challenger nodes to help test the system, and anyone can apply to become a challenger.

Building a BTCFi Application Ecosystem to Meet Diverse Needs

10. ChainCatcher: GOAT Network recently launched the Bitcoin-native DeFi AI Agent "Satoshi GOAT." What is the purpose of its launch? Additionally, what existing application scenarios or partners does GOAT have? How do you plan to attract developers to build complex applications like DeFi on its Layer 2 network in the future?

Stephen Duan: Satoshi GOAT is our attempt to combine BTC products and AI. Through the AI Agent combined with community education, interaction, and games, we hope to enhance users' understanding of GOAT while making learning enjoyable, allowing users to earn rewards through interaction and games.

In terms of ecosystem expansion, GOAT has currently launched basic DeFi projects such as OKU (Uniswap DAO version), GOATSwap, Avalon, and Artemis, as well as the Rarible NFT marketplace, One Play, Growfitter, and Go Goat games.

For BTCFi products, our approach is to provide different categories of products based on the varying risk preferences of BTC holders. For instance, some large institutions and sovereign funds have extremely high security requirements for BTC assets and very low risk tolerance, so we will specifically launch fixed deposit-type products to meet their needs.

For users with higher risk tolerance, we are collaborating with Option Market and Perps to serve them.

Our focus will be on guiding developers to provide BTCFi products that meet different risk preferences through grants, investments, and other means, enriching the on-chain product portfolio.

11. ChainCatcher: Speaking of BTCFi, many community users are questioning "Does BTC really need Fi?" What do you think are the current market demand scenarios for BTCFi?

Stephen Duan: We believe that when considering whether BTC needs Fi, it is best to abandon the macro perspective and start from the micro level ------ that is, the actual holders of BTC, to see what their real needs are.

To clarify these needs, we have conducted thorough research and summarized some user profiles.

For example, miners have encountered risks with BTC custody solutions and cold wallets, with a risk tolerance index of 0. They have some BTC income each month but also need to pay electricity and operational costs, and they do not want to sell BTC. They hope to earn interest on BTC to cover costs while leaving assets for future generations.

Mining pools need to pay operational costs and shareholder dividends, hoping to profit through native yield solutions while running nodes to ensure security.

Sovereign wealth funds want to convert BTC reserves into actual returns to support national initiatives while encouraging citizen participation.

Hedge funds/custodians seek safe and controllable native yield solutions for BTC managed on behalf of clients.

Additionally, some project teams have quickly partnered with various BTC and BTC LST protocols to boost TVL data, but these short-term strategies have instead created hidden liabilities. When these projects urgently need to hedge debt risks through yield channels and airdrop collaboration mechanisms.

Beyond these B-end players, some ordinary BTC holders also have BTCFi needs. For example, some DeFi players hold a significant amount of BTC or wrapped BTC and have been mining in DeFi. They do not want to easily sell their BTC and are looking for secure new mining methods.

Moreover, some holders with very little BTC, the "10U" warriors, hope to leverage some products for high returns? And newcomers, who know nothing about wallets or mnemonics, see Bitcoin's high price and want to buy but do not know where to do so?

These are genuine needs, but data shows that about 90% of BTC is still idle. While addressing these needs is not an overnight task, I believe that in this world, there are only untapped needs, and no need is insurmountable.

12. ChainCatcher: What challenges does the industry currently face in addressing various real needs for BTCFi?

Stephen Duan: Although challenges exist, it does not mean that the BTCFi track is unviable.

Aside from the previously mentioned native security of BTC, the real challenge for BTCFi lies in the economic model, which needs to consider the sources of native BTC yield and how to establish sustainability.

We believe that establishing Layer 2 based on the native security of BTC is the starting point for the sustainable development of BTCFi. By combining ZK Rollup bridges, BTC can be safely and efficiently introduced into Layer 2 for economic activities. The revenue generated from the transaction volume on Layer 2 (such as gas fees) should be partially returned to BTC holders as a reward for providing liquidity and security.

If Layer 2's gas fees are denominated in BTC, this constitutes an extremely pure "native BTC yield" model. Prior to this, BTC had almost no truly native yield scenarios, aside from funding rates in CeFi.

The Babylon model essentially harvests third-party tokens, which are neither native nor sustainable. Furthermore, to achieve sustainable yields, effective control of Layer 2's operational costs is necessary.

In ZK Rollup solutions, roles such as Sequencer, Prover, Challenger, Operator, and Committee each bear different responsibilities, and their revenue structures differ. How to ensure the incentive mechanism while controlling overall costs will determine whether Layer 2 has sustainable operational capabilities. As we discussed earlier, the innovative incentive mechanism of GOAT BitVM2 has built a powerful economic system based on universal operator rotation, ensuring that responsibilities such as Sequencer, Prover, Challenger, and Publisher are fairly distributed among all stakers. Through transaction fee sharing, fraud bounties, and penalty mechanisms, the protocol encourages honest behavior while economically penalizing malicious actions, thereby creating a sustainable, fair, and resilient decentralized ecosystem.

Committed to Becoming the Liquidity Center of Blockchain

13. ChainCatcher: Last month, GOAT Network launched the Alpha mainnet. How is the current performance of the Alpha mainnet? Can you share some data or use case performances?

Stephen Duan: The Alpha mainnet has now stably gone through three upgrades, surpassing 700,000 wallets and processing nearly 3.4 million transactions.

The community is also steadily growing. The Happy Birthday NFT series launched in April, totaling 2,000 pieces, sold out immediately upon release, and the floor price has tripled. The Odyssey event with OKX Wallet has also begun.

Additionally, GOAT is conducting a pre-market fair launch on the Aspecta BuildKey platform, providing the first round of on-chain priority participation opportunities for GOAT Network community members, which has received positive feedback.

14. ChainCatcher: What is the next step in GOAT Network's technology or product roadmap? Is there a long-term plan for the expansion of the Bitcoin ecosystem and cross-chain interoperability (such as with Ethereum and Solana)?

Stephen Duan: We will further optimize GOAT BitVM2 to enhance the efficiency and security of optimistic challenges. Additionally, we are actively following up on other potential BTC zkRollup solutions. For example, after supporting OP_CAT, we can directly use BTC scripts for STARK Proof verification, which can transform the current optimistic challenge process into immediate verification.

In terms of cross-chain interoperability, blockchain interoperability is typically achieved through "trusted bridges," which rely on independent centralized or partially decentralized intermediaries to verify and relay cross-chain messages. We are exploring the Entangled Rollup solution, which does not require cross-chain bridges for multi-chain interoperability. This not only supports interoperability and asset transfers but also empowers rich multi-chain applications and protocols, allowing them to fully utilize underlying infrastructure and ecological resources.

15. ChainCatcher: Bitcoin Layer 2 experienced a wave of market excitement last year but has since cooled down. What do you think about the next explosion cycle for Bitcoin Layer 2? At this stage, what key points do you think a Bitcoin Layer 2 project needs to focus on to maintain long-term competitiveness?

Stephen Duan: The core is still to build a healthy BTCFi ecosystem. Technically, we will continue to promote the ongoing optimization of GOAT BitVM2, zkMIPS, and De Seq; in terms of the economic model, we will ensure a healthy and sustainable incentive model for the Universal Operator.

Despite investors generally being cautious, we remain firmly bullish on Bitcoin Layer 2 and BTCFi, believing that the era of BTCFi is far from over and that the future is promising.

16. ChainCatcher: What is GOAT Network's long-term vision?

Stephen Duan: The vision of GOAT Network is divided into two phases. The first phase is to become the core infrastructure in the Bitcoin ecosystem, providing sustainable and secure BTC yields for Bitcoin holders through native Bitcoin ZK-Rollup technology and decentralized Sequencer, while promoting the comprehensive implementation and development of BTCFi.

The second phase is to unify the fragmented consensus and decentralized liquidity across various chains based on the underlying zkVM, where GOAT Network will build Entangled Rollup to become the liquidity center of blockchain.