A Review of Mining History, BTC Layer 2 Ecological Layout and AI Trend Analysis

Recently, a co-founder and CEO of a certain company shared with industry insiders the experiences of early Bitcoin miners, discussed the challenges faced by miners, and elaborated on views and related plans regarding BTC Layer 2 and AI.

As an experienced miner, NFT collector, and on-chain inscription participant, this CEO reflects on the development of the cryptocurrency industry over the past decade. From the early days of GPU Mining to the emergence of ASICs, from the first halving to the Mt. Gox incident, to the rise of Ethereum ICOs and smart contracts, the DeFi boom and NFT explosion, up to the recent prosperity of the Bitcoin ecosystem and the emergence of various Layer 2s and sidechains, he has witnessed the entire industry's journey from nothing to something.

The launch of the Bitcoin ETF in January 2024 marks the official debut of Bitcoin as a mature financial asset. At this current juncture, the core issues of the blockchain industry have become largely clear, and it is expected to usher in significant growth in the future, making blockchain technology truly widespread, allowing end users to enjoy the convenience and security it brings without any awareness.

The opportunity for institutional and professional mining originated from the bear market at the end of 2014 to 2015. At that time, the price of Bitcoin plummeted, forcing miners to optimize electricity costs and operate in a corporate and large-scale manner to improve profit margins and risk resistance. This led to a trend of migrating from high-quality mining sites in urban centers to regions with more competitive electricity costs.

Miners search for cheap electricity resources along the rivers, establishing new mining farms in harsh environments. This process drives the scaling and centralization of global cryptocurrency computing power, with most of the computing power concentrated near specific areas of hydropower and thermal power stations.

However, overseas mining also faces many challenges. Issues exist in areas such as legal frameworks, tax planning, mining operations, and equipment maintenance efficiency. Factors such as fluctuations in electricity prices and downtime caused by special events have also increased overall costs. Some miners are turning to the South American and African markets, but they are facing issues of political stability and security. Currently, some national sovereign funds have begun to enter the mining sector, paying less attention to the payback period, which further depresses the industry's profit margins.

For BTC Layer 2 projects, the recent prosperity of the Bitcoin ecosystem stems from the demand spillover caused by long-term congestion on the mainnet. With the development of EVM side modular blockchain technology, many projects have emerged attempting to build Layer 2 networks on top of the Bitcoin ecosystem. Due to Bitcoin's limited support for smart contracts, there is a short-term need to bridge Bitcoin assets to Layer 2 networks or EVM.

A certain company has provided an MPC-based multi-signature solution, which enhances the security of funds by having multiple parties hold private key shards. In the long term, with updates to the Bitcoin Opcode layer and the development of cross-chain communication solutions, these issues are expected to improve.

In terms of AI, individual work efficiency has significantly improved. From a company perspective, the integration of AI and the blockchain industry is being explored. In the future, scenarios may emerge where AI Bots represent different entities to deploy smart contracts and interact on the chain. With the resolution of blockchain performance issues and the reduction of on-chain costs, a situation may arise where a large number of AI Agents conduct transactions and use smart contracts directly on the chain, while humans mainly focus on setting rules and risk control.

Based on this vision, a certain company is dedicated to unifying the underlying infrastructure and risk control layers of its various wallet product lines, providing standard APIs to support AI Agent integration. The relevant product prototypes are expected to be launched in the second half of this year.