Written by: c00k1e, Jaleel, BlockBeats

Edited by: Zhang Wen, BlockBeats

Ordinals has been developing for more than a year. This year, we ushered in the fourth halving in the history of Bitcoin, and also ushered in a major update in the Ordinals ecosystem - the launch of runes. After the launch of runes, we witnessed the short-lived "rune craze" with soaring fees, the "epic satoshi auction" worth 33.3 bitcoins, and the suspicion of "Casey hara-kiri" and "Runes are dead, Ordinals is dead". We have witnessed the quiet demise of many Ordinals projects that were still active in 2023, and the emergence of countless Bitcoin Layer 2 projects.

UniSat, the light of the Chinese Bitcoin ecosystem, has been moving forward in a low-key manner and has always stood at the center of the Bitcoin ecosystem. Whether it is the previous $PIZZA that gave Chinese and foreign Ordinals players a generous reward, or the Bitcoin native expansion plan Fractal that has been unanimously recognized, concerned and expected by Chinese and foreign Ordinals players recently, UniSat itself has not taken the initiative to make too many marketing moves, but their every move of silent cultivation is still known and highly concerned by the market.

Starting with open source wallets and engraving services, UniSat's role positioning has quietly changed in more than a year. How do they view the current Ordinals and Bitcoin ecosystem, and even future development? What thoughts, persistence and expectations do they have for the development of Fractal and even UniSat itself? With curiosity about the above questions, BlockBeats contacted UniSat founder Lorenzo. Let's hear Lorenzo's views.

Views on the market

BlockBeats: The trading volume of inscriptions and runes has been shrinking in the past few months, causing many Bitcoin ecosystem players to lose confidence. What do you think caused the sluggish performance of the Bitcoin ecosystem after the launch of runes?

Lorenzo: The market has its own rules. Sometimes, the moon waxes and wanes, and things grow old. It is normal to have ups and downs. It was the same for a few months in the middle of last year. Just keep a normal mind.

For people who do things, the trough helps to accumulate strength. We also felt the changes brought about by market sentiment during the development of Fractal. When the market is hot, there are all kinds of voices every day, and it seems that there are people pulling you in any direction; after the market is cold, these voices are gone, and I can finally "write bugs" with peace of mind, haha.

BlockBeats: There is an interesting "egg problem" about BRC-20 and runes. One view is that BRC-20 and runes need to be launched on a large scale before the relevant infrastructure can be discovered by the market value. Another view is that the relevant infrastructure needs to mature before BRC-20 and runes will usher in a new round of bull market. What do you think about this?

Lorenzo：Last year, we did see the new vitality that the outbreak of inscriptions brought to the Bitcoin ecosystem. We also experienced the situation in April and May last year when the system was completely stuck because it could not bear the heat brought by BRC-20. We had no choice but to sit and wait. So in the long run, if we only stay at the wealth effect and do not consider the problem of infrastructure, it is very likely that there will be a large-scale outflow of assets again and again, and the subsequent network congestion and soaring fees will quickly reduce the heat. In the long run, everyone will question the practicality of the Bitcoin network and the value brought by protocols such as inscriptions and runes.

We are more concerned about whether Bitcoin can run on a healthy track in the long run. We are not thinking about just making UniSat's products or Fractal's ecology better, but whether we can help Bitcoin grow into a system so that all participants can have more opportunities. Only with mature infrastructure can we be ready for a match to ignite the bull market.

BlockBeats: When and under what conditions do you think the next wave of explosive growth in the Bitcoin ecosystem will come?

Lorenzo:The Bitcoin ecosystem has always been on the road, and UniSat has been running regardless of wind and rain. We are not good at operations, markets, promotions, or marketing, but what we have is the determination, patience, and calmness to move towards our goals step by step. We have extraordinary confidence in Bitcoin, and we also hope to expand Bitcoin into a more trustworthy electronic cash system through Fractal. We are full of expectations for a more efficient, elegant, fair, and transparent future. As for whether to stand idly by or participate in the construction of such a future, it is left to everyone to judge and choose independently.

About Fractal

BlockBeats: Fractal is described as a "Bitcoin native expansion solution" that uses Bitcoin Core code for unlimited levels of expansion. What is the biggest difference compared to many other Bitcoin Layer2 or sidechain projects on the market?

Lorenzo:First of all, Fractal's starting point is to make Bitcoin better. To sum up, borrowing the words of a community friend, "You can think of Fractal as Bitcoin's most loyal assistant, and all designs are to solve Bitcoin's practical problems."

Fractal is currently the only native Bitcoin expansion solution, using Bitcoin Core's code and maintaining a high degree of consistency with Bitcoin. If other L2s and sidechains are building another highway, then Fractal can build countless highways parallel to the Bitcoin mainnet. Each road can be to expand the Bitcoin mainnet or to expand another road. In this way, each route has its own unique value orientation, and you can solve the congestion problem without changing transportation. Our address format is the same as the main network address, and we use the original wallets, tools, mining machines, etc. This is also the reason why the community feedback is very comfortable and convenient to use Fractal.

Unlike some Bitcoin Layer 2, Fractal will not compete with the main network for attention and liquidity, but will be a solution with unique advantages. In the case that the Bitcoin main network cannot effectively support certain features, Fractal will be a good choice.

Fractal is also very suitable to be used as a precursor network for Bitcoin, because it is highly consistent with the main network and optimized in performance, which is very suitable for complex applications to experiment and innovate as much as possible. At the same time, it allows users to participate and give real feedback in a real interactive environment, which is currently impossible for Signet, Testnet and other Bitcoin Layer 2.

In addition to the technical level, from the perspective of governance, Fractal's governance will be decentralized as much as possible, allowing the community to participate in the decision-making of many major events. For example, for OP_CAT this time, we decided whether to activate OP_CAT on the Fractal testnet and mainnet through online community voting. We are only information providers and executors, listeners to the community, not decision makers.

We will add more channels for effective communication with the community, and hope that any opinions will have a place to be heard. In the future, we hope that developers, institutions, and communities can form a three-legged situation in the Fractal ecosystem to avoid the situation where the community resists institutions and project parties and affects the development of the ecosystem. This is also truly in line with the decentralized and open principles of Bitcoin.

BlockBeats: Why did you think of activating OP_CAT on Fractal? If Bitcoin Core later promotes the OP_CAT upgrade of the Bitcoin mainnet, it may pose some threats to Fractal. What unique advantages can OP_CAT on Fractal show at that time? For example, some specific applications?

Lorenzo: The significance of introducing OP_CAT is to expand the programmability of Bitcoin while taking into account security. We believe that the potential of OP_CAT is still not fully understood by everyone. At the beginning, I also underestimated the possibility of OP_CAT. Thanks to our partner team sCrypt for helping us understand it more deeply. OP_CAT is actually very powerful and allows us to achieve almost all the performance on the Bitcoin network.

It is worth noting that the Bitcoin network is a system engineering, and the theoretical advantages of a function may be completely different from its practical manifestation in the system. For example, some people have proposed using OP_CAT to verify ZK_proof, but it is not realistic to run such a large script on the Bitcoin mainnet. So we can't just stay in theoretical research, it is more important to actually operate it. Here we can reflect the advantages of OP_CAT on Fractal. Fractal's large capacity allows developers to experiment as much as they want and keeps the cost extremely low for a long time. Many complex applications that are not feasible on the mainnet can be well implemented on Fractal.

I don't think it should be said that the upgraded mainnet will pose a threat to Fractal, but each has its own strengths. Fractal is suitable as a storage place for less important assets, while the BTC mainnet is suitable for very high-value assets. After all, it is the most secure network. This can encourage asset innovation while avoiding congestion on the mainnet. Both have their own responsibilities.

BlockBeats: Fractal promises to provide a secure and scalable solution. Can you explain how Fractal deals with common security issues, such as the risk of 51% attacks? How does its architecture ensure future growth while maintaining security and scalability?

Lorenzo: Common 51% attacks are generally divided into two types:

Hidden blocks + empty blocks/exclusion of specific transactions. Under the Fractal system, joint mining ensures that a normal transaction gets a chance to enter a block every two free blocks. Assuming that the attacker continues to produce empty blocks, all free blocks will be marked as empty blocks, then the network will only degenerate to a normal transaction getting a chance to enter a block every 90 seconds.

The vault uses the lagging difficulty adjustment to produce blocks crazily. Fractal has made adjustments and optimizations based on the dynamic DAA, so that the difficulty adjustment when the computing power is turbulent can better match the actual changes.

In terms of the consensus mechanism, we use an innovative method "Cadence Mining", 2/3 of the blocks are produced by free mining, and 1/3 of the blocks are mined by joint mining. Miners can use existing mining machines to mine Bitcoin mainnet and Fractal at the same time. Joint mining requires high computing power, which is large enough, which is equivalent to using additional Fractal Bitcoin income to incentivize miners while also ensuring network security.

Another security issue that everyone is more worried about should be cross-chain. The MPC solution is our current minimum requirement solution, because we must prioritize the good operation of Fractal and ensure stability while innovating. We are also working with other teams to develop atomic solutions, which means that my assets go directly into the counterparty's wallet, and the counterparty's wallet goes directly into my wallet. There is no third possibility, which completely eliminates the need to trust the platform. In addition, we are also promoting several other technological innovations, hoping to provide more options for everyone.

Asset security is an issue we attach great importance to. When choosing solutions and partners, we will carefully consider the pros and cons to ensure safety and reliability. Therefore, some technical routes will be abandoned after trying. After we announce mature solutions, we can share our exploration and thinking with everyone.

BlockBeats: With Fractal about to go online in September, the community is full of expectations for possible dApps (such as Satspumpfun). In addition to Satspumpfun, what other projects or applications of Fractal are worth paying attention to? What preparations has UniSat made for this?

Lorenzo：From the point of view of everyone, the first type of application should be a bridge, that is, an application that helps assets flow between the Bitcoin mainnet and the Fractal mainnet. Some of these applications emphasize security, some emphasize decentralization, some emphasize atomicity, and some emphasize trustless platforms. Each has its own advantages. There is no perfect solution yet. What we can do is to provide more relatively reliable options so that users have the ability to choose and balance among different options.

The second type of application may be transaction-related, such as native Swap, DEX, NFT Marketplace, etc. It can provide a low fee rate, fast confirmation, smooth experience, and sufficient liquidity that are more advantageous than the first layer. This is the most intuitive benefit that Fractal can bring. Please note that the low fee here is not 10% or 20% off, but a difference of one ten-thousandth or one hundred-thousandth under the same mechanism as Bitcoin. This makes it possible to build projects based on a large number of on-chain transactions, such as relatively cheap props transactions in games.

The third category of applications may be those that have been suppressed on the Bitcoin layer due to the limited block size, such as DID applications, credential issuance applications, voting governance applications, and other applications that target frequent participation and interaction of a large number of users. This type of application can maximize the benefits of Fractal and Bitcoin mainnet address and private key consistency.

After the initial stage of Fractal's value establishment, I hope to see more innovative, more interesting, and more integrated applications with the real world or other industries. Bitcoin has a very broad mass base. I believe that there must be a team that can create popular applications for a wider range of people and enable Bitcoin to connect with the real world. We are looking forward to it and will fully support it.

BlockBeats: Fractal's several rounds of testing have received great attention and enthusiastic participation from Chinese and foreign communities. Some voices from the English community expressed concerns that UniSat's construction on Fractal would prioritize BRC-20 over Runes. Do you want to respond to this point of view?

Lorenzo:Many friends in the community got to know us because BRC-20 entered the Bitcoin ecosystem and then used the UniSat wallet. Naturally, they would make a deeper connection between BRC-20 and UniSat. It is understandable that everyone has a special feeling for BRC-20.

We recognize the value of BRC-20 and actively promote the technical development of BRC-20 with L1F and other partners. But at all times we maintain a neutral and open attitude towards asset issuance protocols. As long as there is user demand and it is beneficial to the overall Bitcoin ecosystem, we will support it. Priority depends to a certain extent on the needs of the community, and we will try our best to achieve it if there is demand.

Not only do we not take a position on the choice of protocol, but also on products and features, in many cases, even if we think a certain technology is very good and even fully prepared, we will not take a special position. For example, we think OP_CAT is an important improvement, and we have made technical preparations early on, but we still launched a wide range of community consultations and votes, hoping to understand everyone's true attitude, rather than rashly acting rashly. The reason is simple. If the community thinks that the time is not yet ripe but insists on pushing it, who can be blamed?

UniSat's changes, development and future

BlockBeats: Because UniSat's wallet is very good, people used to compare UniSat with Xverse. But after UniWorlds and Fractal, has UniSat's overall positioning changed?

Lorenzo: UniSat has evolved from an open source wallet to an engraving service, to a protocol contributor, to a developer service, to an infrastructure provider, and now to a Bitcoin expansion solution implementer. Such a phased role change is inseparable from our long-term pursuit. On the solid foundation of Bitcoin construction, we clearly know our direction, and we are neither arrogant nor impatient, and we move forward step by step towards our goal.

At present, we have become an infrastructure provider that the ecosystem relies on. Our API provides services to hundreds of teams, with monthly usage and requests exceeding 1 billion times, and it is still increasing rapidly. You may not think that the traffic cost we pay to developers for API requests every month is even greater than the traffic cost provided by the official website to hundreds of thousands of users for daily access. And under such high-intensity API access, we continue to provide free quotas for more than 95% of development teams. For us, it is our mission to build infrastructure to protect ecosystem builders.

Having said that, I want to thank these ecosystem partners for their trust in us. We will continue to move forward with these encouragements. I also want to give a thumbs up to our UniSat Infrastructure team. You have worked hard. You are the best!

BlockBeats: Can you share some of the projects that UniSat is currently investing in or cooperating with? And how will these projects complement Unisat and Fractal to form a more complete business closed loop?

Lorenzo:We are a team mainly composed of engineers and are not very good at investing. So far, all our investments are in the hope of being able to provide substantial help in the direction of exploration. From a long-term perspective, we hope to be more open in investment and invest in more innovative and adventurous teams. This type of investment can help us see the direction of progress more clearly. If it fails, although we lose money, it is a good lesson for all entrepreneurs; if it succeeds, it will be a huge help to the community and the ecosystem.

BlockBeats: We know that Fractal will have its own token in the future. Many community friends actually want to know what are the differences in the functions and positioning of $SATS, $PIZZA and Fractal's new token?

Lorenzo: Regarding the positioning of different assets, we still hope to retain our own views for the time being. Overall, we are more focused on the overall success of Bitcoin as a system. If Fractal becomes a truly useful extension of Bitcoin, the value of the corresponding assets will also increase simultaneously. Otherwise, whether it rises or falls, as a purely speculative zero-sum game, it is difficult to bring growing value to participants.

BlockBeats: Some players have noticed that it has become much harder to get UniSat Points recently. Can you tell us what the reason is for this adjustment? In addition, players are very concerned about whether there is a way for ordinary people to participate in the Fractal ecosystem to get rewards. What advice would you give them?

Lorenzo: In fact, after the engraving rate dropped, contrary to everyone's intuition, the cost of getting points has actually decreased rather than increased, because the cost of hitting 10 points is now lower than the original cost of hitting 1 point. From a long-term perspective, we hope that UniSat Point can well reflect the relationship between our users and UniSat. Later, as Fractal's mainnet is launched, more ways to obtain points will be gradually opened.

After the mainnet is launched, we encourage everyone to participate in high-quality projects that they recognize. Fractal is a PoW consensus mechanism. Friends who are interested and capable can participate in mining pools or conduct free mining on their own. At present, in the testnet stage, we encourage everyone to get test coins to participate in the testnet interaction, help us conduct various tests and provide valuable feedback. We will give corresponding feedback to users who contribute to the growth of the network.

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