Fractal Bitcoin: Comprehensive Research Report

Abstract

Fractal Bitcoin was launched on September 9, 2024, and is an innovative project within the Bitcoin ecosystem. It adopts a unique hybrid mining model that combines merged mining and permissionless mining. As a leading network for Bitcoin, Fractal provides developers with a valuable testing environment. By partnering with OKX and UniSat, Fractal has attracted the most active Bitcoin users from the very beginning. It maintains a pragmatic community-driven strategy, avoiding excessive hype and institutional influence. Fractal has also successfully integrated key participants in the Bitcoin ecosystem, including the BRC-20, Ordinals, and Runes communities.

1. Introduction

Fractal Bitcoin is an extension solution based on the Bitcoin core code that can expand infinitely through recursion. It is built on the Bitcoin blockchain and represents a new attempt at the discussion of Bitcoin scalability. The mainnet of Fractal officially launched on September 9, 2024, showcasing strong appeal and technical robustness. Within 24 hours of its launch, Fractal's joint mining accounted for over 40% of Bitcoin's total hash rate, with free mining accounting for 2% of Bitcoin's hash rate. Several major mining pools such as F2Pool, Antpool, and Spiderpool have joined Fractal's mining ecosystem.

2. Core Concepts and Technologies

2.1 Native Bitcoin Expansion

Fractal, as a native extension of Bitcoin, utilizes the existing codebase and modifies block production parameters to maintain complete compatibility with the Bitcoin mainnet. This approach enhances functionality without affecting the core security model of Bitcoin.

2.2 Technical Specifications

• Block Time: 30 seconds
• Mining mechanism: Mixed mining method, 2/3 permissionless mining, 1/3 joint mining
• Scalability: Supports infinite layers of improvement, with each layer providing a 20x capacity increase.
• Smart Contract Functionality: Implement OP_CAT opcode, supporting Turing-complete smart contracts
• Parallel execution: allows different applications to run independent instances
• Compatibility: 100% compatible with Bitcoin standard ( such as BRC-20 and Ordinals)

2.3 Unique User Experience

The wallet address on Fractal is exactly the same as the mainnet address, and users only need to switch networks in supported wallets to access different layers. Major wallets such as OKX wallet and UniSat wallet fully support Fractal Bitcoin.

3. The Position of Fractal in the Bitcoin Ecosystem

Comparison of 3.1 with Other Bitcoin Solutions

• Compared to EVM-compatible Layer 2: Fractal adopts a native Bitcoin approach, which may align more with the ideals of Bitcoin purists.
• Compared to Bitcoin Cash ( BCH ): Fractal did not create an independent chain, but embraced Bitcoin as the mainnet and sought local scalability.
• Compared to the Lightning Network: Fractal offers comprehensive smart contract support without the need for channel management.

3.2 Market Strategy and Built-in User Base

Fractal relies on the support of UniSat and has an inbuilt user base of about 1 million weekly active users. This allows Fractal to bypass the barriers of early adoption. Fractal plans to use the number of transactions as its core metric, rather than the total locked value ( TVL ).

4. Ecosystem Construction

4.1 Decentralization Concept

Fractal is committed to diversified cross-chain bridge solutions, an open development environment, community-driven governance, and distributed infrastructure.

4.2 Launch Users and Developers

• User Rewards Program: Distributing 1 million FB tokens to over 100,000 eligible addresses.
• OKX Wallet Partnership
• Developer Incentive Program

4.3 Funding Programs and Project Evaluation

Fractal adopts a retrospective funding approach, rewarding based on the actual impact of the project. Evaluation criteria include contributions to the ecosystem, technological innovation, and more.

4.4 Outstanding Funding Projects

Including sCrypt, F2Pool, Nubit, DeTrading, UniWorlds, and FractalEcosystem.io, etc.

4.5 Future Outlook

Plan to expand funding programs, enhance community engagement, and support broad future applications and scalable infrastructure development.

5. Token Economics and Economic Models

5.1 Token Details

• Name: FB( Fractal Bitcoin )
• Max Supply: 210 million coins
• Total Supply: 105,153,225.00000000
• Circulating Supply: 1,213,225.00061300
• Main use: Transaction fees ( within the Fractal ecosystem )

5.2 Token Allocation

• Proof of Work Mining (50%)
• Ecosystem Reserve Fund ( 15% )
• Community Rewards (10%)
• Presale (5%)
• Advisor Pool(5%)
• Core Contributor (15%)

5.3 Release and Lock Period

The presale and core contributor tokens have a seven-month lock-up period, after which they will be released linearly until the end of twelve months. The ecosystem reserve and community reward tokens will be released at a maximum of 10% per year over 10 years. Advisor tokens will be released at a maximum of 20% per year over 5 years.

5.4 Transparency and OP_CAT Governance Voting Mechanism

Fractal has announced the official addresses for each token allocation category and plans to adopt a governance voting mechanism based on OP_CAT.

6. Team and Partners

6.1 Core Contributors

Including the co-founders of the UniSat team and Block Space Force.

6.2 Developer Platform Partnership

Fractal has received support from the Scrypt team, which is building a smart contract meta-protocol on Bitcoin using OP_CAT.

7. Challenges and Risks

• Programmability: The use of Bitcoin scripts may hinder the growth of the ecosystem.
• Technical risk: There are risks associated with modifying the core parameters of Bitcoin and implementing new features.
• Adoption risks: Potential resistance from Bitcoin extremists, as well as the difficulty of persuading users and developers to switch.

8. Conclusion

Fractal Bitcoin represents a groundbreaking approach to extending Bitcoin's functionality. It has advantages such as native Bitcoin integration, technological innovation, and a built-in user base. While facing challenges in programmability, technology, and adoption, Fractal's innovative approach, strong support, and early mining adoption demonstrate significant potential. It may reshape the utility and adoption landscape of Bitcoin, but potential investors and users should carefully weigh the project's potential against its risks.