SatLayer: Bitcoin restaking, simplified
SatLayer is a modular security layer for Bitcoin. Built on Babylon, it allows BTC holders to restake their assets to secure decentralized apps and protocols — known as Bitcoin Validated Services (BVS).
This brings Bitcoin’s economic weight into programmable, slashable infrastructure, unlocking new use cases without modifying the Bitcoin base layer.
Investors and funding
SatLayer raised $8 million in pre-seed funding led by Hack VC and Castle Island Ventures, with participation from top-tier investors such as Franklin Templeton, OKX Ventures, Amber Group, Finality, CMS Holdings, Arcanum, UTXO, Maven 11, and Blkcelerate.
This early support signals strong confidence in SatLayer’s mission to unlock Bitcoin’s cryptoeconomic potential through modular restaking infrastructure. However, the project is still in its early stages, with its devnet open and testnet forthcoming — meaning active development and iteration are ongoing.
Why SatLayer?
Despite its dominance, Bitcoin hasn’t been meaningfully integrated into staking or security layers of decentralized ecosystems. SatLayer changes that. It allows BTC to become active economic collateral without altering the Bitcoin protocol. Anyone can launch a BVS secured by BTC or delegate liquidity — no permission required.
How it works
SatLayer lets Bitcoin holders restake their BTC — usually in the form of wrapped or liquid tokens like WBTC, stBTC, or LBTC — and use it to help secure decentralized apps.
It’s built on Babylon Genesis, a new blockchain that supports slashing of BTC without moving it off the Bitcoin network. This is possible thanks to a cryptographic trick called EOTS (Extractable One-Time Signatures) — a way to slash BTC if someone cheats, without needing smart contracts on Bitcoin itself.
To make this usable by developers, SatLayer adds smart contract support via CosmWasm, allowing for programmable rules and logic. This is where apps (called Bitcoin Validated Services, or BVS) can define what behavior is good or bad — and when a validator should be punished.
There are three main types of users:
- Restakers: people who deposit BTC-based assets
- Operators: they run the infrastructure and can be slashed if something goes wrong
- BVS Developers: they create the apps that rely on this setup for external security
SatLayer’s architecture is modular, meaning different parts (like slashing logic or reward tracking) are handled by specific smart contracts — such as StateBank, BVSDriver, and SlashManager. That makes the system flexible, but also means risks depend on how each BVS is designed.
Bottom line: restaking lets Bitcoin do more, but it also brings real risk. The rewards are higher — but so is the responsibility.
Audits and security
SatLayer has undergone multiple audits, including:
- Zellic & Salus — EVM contracts (Ethereum, BNB, Berachain, Bitlayer)
🔗 Audit page - Zenith & Asymptotic — SatLayer’s Move-based staking app for Sui
🔗 Sui audits - Oak Security, Hashlock, Coinspect, Dedaub — CosmWasm contracts (Babylon)
🔗 BVS Core audits
Key modules like staking, delegation, slashing, and reward logic are covered. The protocol also maintains an active bug bounty via Sherlock:
🔗 Sherlock Bug Bounty
How is it different from LST protocols?
Liquid staking protocols like Lido’s stETH unlock liquidity on staked assets. SatLayer is not just a liquid staking wrapper aggregator — it’s a restaking layer. Staked BTC isn’t just sitting; it actively secures external systems.
Key distinctions:
- SatLayer doesn’t issue its own LST — it integrates with others like WBTC, stBTC, FBTC, etc.
- Security, not liquidity, is the core use case
- Like EigenLayer, it introduces slashing risk — incentivizing careful delegation
- Rewards come from BVS-level emissions, not just native yield from underlying tokens
It’s closer to EigenLayer in architecture, but with BTC as base collateral and independent security via Babylon.
Competitors and related projects
SatLayer sits at the intersection of BTC restaking and modular security. How does it differ from others?
- Babylon: The base PoS chain enabling native BTC staking. SatLayer builds on top, adding developer-facing infra and restaking logic tailored to BVS use cases.
- BounceBit: Dual staking protocol merging CeFi/DeFi. Focused on yield generation, not providing a permissionless infrastructure for external app security.
- Bitlayer: A Bitcoin L2 using BitVM, focused on scalable computation and EVM compatibility — not security-as-a-service.
- EigenLayer: Ethereum-native restaking protocol. Shares conceptual overlap with SatLayer but applies to ETH and ETH LSTs — no BTC support.
- Stroom, Lorenzo, Lombard: BTC liquid staking providers. Not direct competitors — they provide LSTs which SatLayer can utilize as restakable collateral.
In short: SatLayer is the first permissionless infrastructure that turns BTC into slashable security for external apps.
Socials
Tokenomics
Native token: SatLayer does not currently have a native token. Instead, it uses Sats², an off-chain point system that tracks early user activity and participation.
Token distribution: While Sats² are not tokens, they are used to track contribution and may be tied to future token allocation events, as hinted in SatLayer campaigns.
Incentives: Users earn Sats² by:
- Depositing supported BTC assets
- Referring others via custom invite links
- Participating in campaigns such as The Great Meme War, Journey to the Sats, and OKX reward drops
- Engaging with the community on Discord, Twitter, and through memes
Some partner platforms (e.g. Lombard, Bedrock) have already integrated Sats² into their own reward systems.
Supported assets and chains
SatLayer is live on Ethereum, BNB Chain, Sui, Bitlayer, and Berachain.
BTC assets: WBTC, FBTC, stBTC, uniBTC, solvBTC, pumpBTC, LBTC, and others.
Key partners include: Babylon, Bitlayer, Pendle, Izumi, Lorenzo, Lombard, Bedrock, Solv, B² Network.
Devnet is open, testnet is next. Developers have access to contracts, SDKs, and a CLI.
Restaking risks and considerations
Restaking introduces risk — particularly slashing. If an operator misbehaves or fails a BVS task, restaked BTC may be partially or fully slashed. Each BVS defines its own slashing conditions — some simple, some cryptographically enforced. This creates real economic pressure for diligence: users have to choose trustworthy operators, understand how each BVS works, and monitor their positions. While SatLayer mitigates this through audits and modular architecture, it’s still an early-stage protocol — so risk remains an integral part of the system.
SatLayer brings BTC closer to the role ETH already plays — providing cryptoeconomic security for external systems.
With SatLayer, BTC can now participate in securing decentralized systems — through restaking, not protocol changes. That includes trustless applications, bridges, oracles, and more — with native yield, slashing conditions, and independent operators.
This opens the door for Bitcoin to serve as a real foundation for modular, security-first DeFi — built around restaked collateral.
Want to dive deeper?
Explore SatLayer’s full documentation: docs.satlayer.xyz
🔹OUR BITCOIN LAYER 2 DASHBOARD
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