UTXO Stack

UTXO Stack is a blockchain infrastructure firm providing a modular launch platform for Bitcoin Layer 2 (L2) solutions and serving as a decentralized liquidity staking layer for the Lightning Network. The company targets developers and projects within the Bitcoin ecosystem facing challenges with scalability, transaction fees, and the inability to create complex smart contracts directly on the Bitcoin blockchain. The platform's business model revolves around enabling developers to launch high-performance, parallel chains based on Bitcoin's native Unspent Transaction Output (UTXO) model.

The company was founded by Cipher, who also authored the related RGB++ protocol. The team from Nervos Network (CKB) is also associated with the development of UTXO Stack. A significant milestone was the completion of a seed funding round on April 3, 2024, co-led by ABCDE and SNZ Capital, with participation from CKB Eco Fund, OKX Ventures, and Waterdrip Capital, among others. This was followed by a Series A funding round at a $50 million valuation, co-led by UTXO Management, CMS, and PAKA.

UTXO Stack's core offering is a platform that simplifies the creation of UTXO-based Appchains, which are essentially custom blockchains. These chains are designed to offer high transaction throughput and low fees by leveraging the parallel processing capabilities inherent in the UTXO model. A key technology is the integration of the RGB++ protocol, which extends the capabilities of the original RGB protocol by using a Turing-complete UTXO blockchain like Nervos CKB for on-chain verification. This allows for the execution of complex smart contracts on Bitcoin assets and facilitates asset transfers across chains without requiring traditional cross-chain bridges, a technique called "isomorphic binding". For security, the platform utilizes a staking mechanism where assets such as BTC, CKB, and other Bitcoin L1 assets can be staked to secure the application-specific chains. The company is also developing the Fiber Network, a Lightning Network implementation on Nervos CKB, to create a hybrid network that supports stablecoins and improves liquidity management.

Keywords: Bitcoin Layer 2, L2 platform, UTXO model, RGB++ protocol, blockchain infrastructure, liquidity staking, Nervos CKB, isomorphic binding, appchains, Bitcoin scaling, smart contracts on Bitcoin, decentralized finance, BTCFi, Cipher, Lightning Network, cross-chain interoperability, parallel chains, staking, data availability, transaction folding, client-side validation, Bitcoin native