A new addition to the cryptocurrency landscape, Social Network, has announced the launch of its testnet. The team describes it as “the first decentralized Bitcoin layer 2 staking protocol with native yield.”
The protocol is designed to tackle issues of scalability, cost, and environmental impact associated with the Bitcoin network. Particularly, it focuses on facilitating decentralized social networks built atop Bitcoin (BTC), as communicated to Finbold.
Interestingly, the company has introduced a promotion for early contributors to its testnet. Named ‘Taproot Farmers,’ this incentive offers top participants free minting of Bitcoin Ordinals. Moreover, the Social Network’s platform aims to address the congestion and high fee issues plaguing the Bitcoin network due to the increased demand for storing additional data.
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It connects with the Nostr decentralized social networking protocol, claiming to offer a scalable solution for storing large volumes of linked data in a decentralized way.
Social Network’s Bitcoin staking and partnerships
The team has released an official whitepaper to coincide with the testing phase and a program to encourage early adopters. Social Network identifies itself as the first non-custodial BTC staking mechanism, intending to expand the Bitcoin ecosystem and form the backbone for decentralized social networks.
In its communication, the team highlights its existing collaborations with various industry leaders such as ChainSafe, Halborn Security, Threefold, BloxRoute, and LaunchNodes.
This Bitcoin layer 2 network seeks to present a secure option for users to stake their BTC and generate what is termed a native yield for token holders. However, it is unclear how the staking works and where the yield comes from. Therefore, investors must remain cautious and seek clarification in this aspect.
Nevertheless, the organization assures it follows an open-source ethos and fair launch strategy, akin to values seen on Bitcoin. With that, Social Network aims to distance itself from venture capital financing and presales.
This Layer 2 launch comes amid increased mainstream attention on blockchain technologies. New spot Bitcoin ETFs, including BlackRock’s iShares Bitcoin Trust (IBIT), have started trading, attracting nearly $900 million in net inflows. Additionally, it precedes the anticipated Bitcoin Halving event in April.
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