The Security of BTC and the Necessity of Layer 2

The innovative technical architecture of Arca Chain seamlessly integrates the solid foundation of the Bitcoin network with advanced Layer 2 solutions, ushering in a new era of combining blockchain technology with Real World Assets (RWA).

By incorporating Optimistic and ZK-Rollups technologies along with an efficient state channel network, Arca Chain achieves exceptional transaction processing speed and unparalleled scalability. It also provides an ideal platform for the digital transformation of decentralized finance (DeFi) and RWAs. Its innovative bidirectional mining mechanism and cross-chain interoperability feature ensure comprehensive security management from digital currency to physical assets, significantly enhancing the resource utilization efficiency of the entire ecosystem.

Using the HASC 2.0 consensus algorithm and intelligent transaction routing, Arca Chain creates a truly borderless, adaptive, and highly secure environment for developers and users. It perfectly supports the tokenization of assets, from cryptocurrency transactions to gold, real estate, and artworks, fundamentally reshaping the future landscape of asset management, investment, and trading.

The Bitcoin network is widely regarded as one of the most secure blockchains globally, with its security primarily relying on the proof-of-work (PoW) mechanism. This mechanism enables the Bitcoin network to withstand various attacks, maintaining its characteristics of decentralization and censorship resistance. However, this high level of security brings challenges in terms of scalability. The Bitcoin network's transaction processing capacity is limited, handling only about seven transactions per second (TPS), which can lead to increased transaction fees and longer confirmation times during network congestion. These issues restrict Bitcoin's practical application capabilities in complex financial applications and high-frequency trading scenarios.

Layer 2 solutions have emerged to address the scalability bottlenecks of the Bitcoin network. Layer 2 is a secondary layer protocol built on top of the Bitcoin main chain that significantly enhances transaction processing capabilities without sacrificing security and decentralization. By handling a large number of transactions off-chain and only submitting the final state to the Bitcoin main chain for confirmation, Layer 2 significantly reduces the burden on the main chain.

This scalability issue is not unique to Bitcoin; it is a common problem faced by all decentralized blockchains, known as the "Scalability Trilemma." This trilemma states that it is difficult to simultaneously achieve scalability, security, and decentralization. Bitcoin was designed with a priority on security and decentralization, which resulted in compromises on scalability. Layer 2 solutions cleverly alleviate this trilemma by moving part of the transactions off-chain, allowing Bitcoin to achieve higher transaction throughput without sacrificing its core characteristics.

Arca Chain, through multi-dimensional solutions, including Layer 2, has built a highly flexible and efficient ecosystem on the Bitcoin mainnet, offloading complex smart contract operations, high-frequency trading, and privacy protection requirements to these efficient layers. This not only solves the scalability issues of the Bitcoin mainnet but also significantly enhances overall transaction processing capabilities, ensuring that users can enjoy unprecedented fast, low-cost, and diverse transaction processing while benefiting from the high security of the Bitcoin network.

Arca Chain's dual-mining mechanism cleverly introduces part of Bitcoin's computing power into Layer 2, further improving the overall system security. The introduction of the HASC 2.0 consensus algorithm and intelligent transaction routing enables Arca Chain to adaptively support a wide range of scenarios, ranging from complex DeFi applications to the digitization of real-world assets (RWA).