Bitcoin Layer 2 Bitfinity Secures $130 Million Valuation in Token Round

Bitfinity, a Bitcoin scaling network on the Internet Computer protocol, has successfully concluded a token funding round, securing a valuation of $130 million. Notable investors, including Polychain Capital, ParaFi Capital, Warburg Serres, Dokia Capital, and Draft Ventures, participated in the funding, disclosed Bitfinity co-founder Max Chamberlin.

Bitfinity's Funding Journey

In an interview with The Block, Chamberlin revealed that the funding comprised two phases—a seed round of approximately $1 million in 2021 and a subsequent growth round. Both rounds utilized token financing, ultimately leading to the significant $130 million valuation achieved in the second round, closed in June of the previous year.

Strategic Timing for Funding Announcement

Chamberlin explained that the decision to announce the funding at this juncture aims to generate excitement ahead of Bitfinity's mainnet launch. Currently in the testnet phase, the mainnet is anticipated to be introduced later this month or in early February.

Bitfinity: Enabling Ethereum Developers on Bitcoin

Bitfinity distinguishes itself as a Bitcoin scaling solution built on the Internet Computer protocol, offering compatibility with the Ethereum Virtual Machine (EVM). Chamberlin emphasized that this compatibility enables Ethereum developers to create Bitcoin-enabled decentralized applications (dApps) on the Bitfinity network. The Bitfinity EVM boasts speeds 100 times faster than Ethereum at a fraction of the cost, accommodating Bitcoin Ordinals, BRC-20 tokens, and EVM assets.

Bitcoin Ecosystem Growth and Bitfinity's Role

The growth of the Bitcoin ecosystem, fueled by the success of the Ordinals protocol, is identified as a significant trend for 2024. The native ORDI token of the protocol has reached a market capitalization of $1.5 billion, with BRC-20 tokens collectively valued at $3.43 billion. Bitfinity aims to contribute to the expansion of decentralized finance activities on the Bitcoin blockchain.

dApps Building on Bitfinity

Several dApps, including Sonic (decentralized exchange), Synthetix (derivatives liquidity protocol), and Liquity (decentralized borrowing protocol), are either building on Bitfinity or planning to do so, signaling the platform's growing appeal.

Positive Reception from Investors

Ben Forman, managing partner at ParaFi Capital, expressed optimism about Bitfinity's impact, stating, "As the demand to integrate Bitcoin increases, we believe Bitfinity’s EVM opens up the Bitcoin ecosystem to novel use cases and applications."

Future Growth Plans

Bitfinity, currently employing around 20 individuals, aims to expand its team to approximately 25 members in the months following the mainnet launch, focusing on building and growing its ecosystem.

Bitfinity Token Listing Anticipation

Chamberlin shared that after the mainnet launch, several exchanges are expected to list the Bitfinity token, reflecting positive anticipation in the market.

Despite these positive developments, it's crucial to acknowledge potential challenges and risks inherent in the dynamic blockchain space, where innovations may face adoption hurdles or unforeseen obstacles.