What is Merlin Chain? Guide to Understanding Bitcoin Layer 2 Network

What is Merlin Chain?

Merlin Chain is a layer-2 application that aims to deal with the scalability issues in the Bitcoin ecosystem. It does this with the help of zero-knowledge rollups, also known as ZK-rollups. It also employs a fraud-proof on-chain mechanism and a segregated oracle network. These features allow for ample transaction credibility which reduces gas prices and improves transaction speed. Moreover, using these features, Merlin Chain allows users to use external data and smart contracts from the Bitcoin layer-1 network.

What makes Merlin Chain unique is that it moves away from the ongoing trend of working like the Ethereum network, while still being compatible with the EVM (Ethereum Virtual Machine). Thus, unlike other layer-2 technology that is stuck to the Ethereum network, Merlin Chain incentivizes users to go for innovations in the overall Bitcoin ecosystem.

Main Features of Merlin Chain

Merlin Chain offers its users some unique features making the technology one of its kind. Here are some of the main features of Merlin Chain:

Zero Knowledge (ZK) rollup: ZK rollup ensures reduced gas fees, faster transactions, and minimal congestion in the blockchain network. It does these functions by employing a few methods. In the layer 2 network, Merlin Chain computes the data and verifies it. While in the layer-1 network, Merlin Chain records the transaction proof. This also ensures the security and accountability in the network.

Fraud-proof: Merlin Chain also employs on-scale fraud-proof mechanisms. It re-verifies that transaction proof that is already verified by ZK-rollup leaving no room for mistakes. This further elevates the data precision on the network.

Segregated Oracle network: Merlin Chain uses DON (Decentralised Oracle Network) to get access to external data sources. Web3 smart contracts can be accessed by Merlin Chain using this technology, providing additional data necessary to process faster smart contracts in the Merlin Chain network.

How Does Merlin Chain Work?

Merlin Chain works by enabling ZK rollup, bridging the gap between layer-1 and layer-2 Bitcoin network, and connecting the platform to EVM-operable dApps.

ZK rollup, as already discussed, processes the transactions making them error-free and enabling faster transactions. Secondly, data can be transferred easily from layer-1 and layer-2 networks through the Merlin Chain. It is done by transforming BTC from a layer-1 network to MBTC in a layer-2 network having the same value, allowing users to use them on smart contracts.

Additionally, Bitcoin-native wallets generally cannot access EVM dApps, but with the unique technology of Merlin Chain, users can move between dApps and Merlin Chain effortlessly. Thus, Merlin Chain facilitates the access to decentralized applications on the Bitcoin network.

MERL Token - The Native Token of Merlin Chain

MERL is a unique token that allows users to interact with various applications on the Merlin Chain. It enables governance, transactions, and voting on the platform. The total supply of MERL tokens is 2.1 billion on the Merlin Chain, some of which are also given as rewards to Merlin Chain users.

MERL can be used for the following purposes.

• MERL token holders can vote for key proposals on the Merlin Chain.
• These tokens can also be staked to bolster network security while offering a passive income method to users.
• MERL tokens are used as a transaction fee for any undertaking on the network.
• The token holders have the power to shape how the platform operates by actively participating in the undertaking of the platform.
• MERL tokens can also be used as collateral on the network to take loans.

What Are the Benefits of Merlin Chain?

Merlin Chain, being a sought-after layer-2 technology, has certain benefits that make it unique.

• Merlin Chain can operate with EVM-compatible dApps. This means that Ethereum users don’t need to shift to a Bitcoin-native wallet while working. Instead, they can do it all on the Merlin Chain.
• Merlin Chain being EVM-compatible means users can use Merlin Chain to work on dApps while making transactions on the Bitcoin network.
• Since Merlin Chain connects native Bitcoin users to the growing Bitcoin ecosystem, it allows for innovations that can further improve the functioning of the network and provide new opportunities to the users.