GOAT Network releases Bitcoin ZK Rollup economic brown paper, systematically addressing the challenges of incentive and verification mechanisms for Bitcoin Layer 2

On June 16, 2025, Eastern Time, GOAT Network officially released the economic white paper on Bitcoin ZK Rollup, proposing the first economic model implementation plan for Bitcoin-native zkRollup. This plan fundamentally addresses the issues of incentive imbalance, concentrated role costs, and low verification efficiency present in the current BTC L2 system through the "Universal Operator Role Rotation Mechanism" and "Multi-Round Challenge Mechanism," providing a solid economic foundation for BTCFi.

Systemic Economic Design Challenges Facing BTC L2

Although Bitcoin Layer 2 technology has made significant progress in recent years, existing Bitcoin Rollup solutions still have systemic flaws in economic design:

• Lack of incentive mechanisms for key protocol roles (such as sequencers, provers, challengers, consensus committees, etc.)

• Withdrawal periods of up to two weeks, greatly reducing capital efficiency and user experience

• Insufficient rewards and penalties for challengers, weakening the protocol's security guarantees

These issues fundamentally stem from role isolation, concentrated costs, and incomplete mechanism design, severely restricting the long-term sustainability of the Bitcoin Layer 2 network.

GOAT Network's latest economic model systematically addresses the above pain points and provides a solution path

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#### Universal Operator Role and Rotation Mechanism

The Rollup system involves multiple roles, each with different responsibilities and costs. Establishing a fair and efficient economic model has always been a challenge. GOAT Network has pioneered the "Universal Operator" mechanism, unifying all roles such as sequencers, provers, publishers, and challengers into the same identity, ensuring:

• Dynamic balance of revenue and costs through role rotation

• High decentralization and network security

• Lower participation thresholds for small nodes, with heavy roles only occasionally undertaken

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#### Multi-Round Challenge Mechanism, Compressing Challenge Period to Within 24 Hours

GOAT Network introduces a Multi-Round Challenge Mechanism based on BitVM2, where each state submission triggers sequential verification by multiple challengers.

• A challenger is randomly assigned for each round, for example, one round every 2 hours for a total of 12 rounds;

• Once a challenge is successful, not only is the fraudster punished, but the challengers from the previous rounds who failed to perform their duties will also be penalized;

• The final confirmation time is compressed from 7-14 days to within 24 hours, significantly enhancing user experience and capital efficiency;

• Maintains the "1-of-n" honest assumption, ensuring high coverage and security; that is, if only 1 out of n participants is honest, the system can still remain secure.

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#### Incentive Compatibility and Anti-Malicious Mechanism

All operators must stake within the GOAT network and accept role scheduling and penalty constraints:

• The role rotation and cost cross-subsidy mechanism incentivizes participants to maintain stability and honesty in the long term;
• Honest behavior earns stable returns (sequencing fees, challenge rewards, etc.);
• Fraudulent or negligent behavior will result in the deduction of staked assets;

The system constructs a stable honest incentive closed loop through the "rotation + staking + economic returns" mechanism, ensuring participants maintain network security in the long term.

• Security via Cryptoeconomics

To further strengthen the system's resistance to attacks and honest participation incentives, GOAT Network has also established a complete cryptoeconomic security mechanism.

• Implements a dual penalty mechanism at L1 and L2 through zkMIPS and Bitcoin scripts;
• Role allocation uses a random mechanism to effectively prevent collusion and bribery;
• Each round is supervised by staked participants, ensuring no one can "free ride."

Ultimately, the system achieves an incentive-compatible, secure, and efficient operating environment through the "staking---random---penalty" triple logic.

Building Infrastructure for BTCFi that Integrates Economy and Technology

Through this design, GOAT Network not only implements Bitcoin-native zkRollup at the technical level but also connects the incentive closed loop of BTC Layer 2 at the economic model level:

• Achieves trustless efficient challenges;

• Ensures fairness and sustainability for participants;

• Provides a secure, efficient, and sustainable underlying platform for financial innovation (BTCFi) on Bitcoin.

Through the economic design built on the Universal Operator mechanism, BitVM2, and zkVM, GOAT Network achieves systemic sustainable security guarantees.

"Without a sustainable incentive model, Rollup cannot truly be implemented. We hope to promote the Bitcoin Layer 2 ecosystem towards a long-term viable direction with fairer participation and enhanced security through this innovative economic design."
------ GOAT Network Core Team