This is an amateur investment research post about the Merlin ecosystem, intended to provide initial information navigation for fams who interested in the Merlin ecosystem. All resources come from public information of Merlin Chain and Jeff as well as the involved projects. Friends are also welcome to contact me to point out any errors. Disclaimer: Investing involves risks, proceed with caution. The content of this article is not investment advice, DYOR

Recently, I've been watching Netflix version "One Piece" , and in the first episode, Gol D. Roger is executed, the first Pirate King in history. Facing the swarming crowd beneath the execution platform, he says, "Wealth, Fame, Power. I found everything this world has to offer. Free yourselves, take to the seas. My treasure is yours to find." As Roger falls to the executioner's blade, thousands rush to the seaside, seeking the supreme treasure he left behind. Thus, the Great Age of Piracy begins.

Seeing this, it suddenly reminded me of a report I had read before, in which Satoshi Nakamoto wrote in one of his last emails: "I've moved on to other things. With Gavin and everyone else, the project will be in good hands." After that, he disappeared without a trace. He and the Pirate King Roger share the same brilliant stroke of "being without possessing, acting without expecting, guiding without dominating."

To most people outside the circle, BTC might be considered the most meme-worthy asset, from the news of blockchain scams happening several times a year to Warren Buffett's recent investment of $500 million in NewBank (this bank offers Bitcoin and other cryptocurrencies trading to its customers). How many people entered the blockchain industry driven by the creed of "code is law" and "open source transparency without the need for trust," and how many were drawn in by stories of overnight riches. The ultimate treasure sought after through all the hardships might be wealth in the worldly sense, the power to fight for one's beliefs, the friendships made along the journey, or perhaps the ability to see and embrace the differences in the world. Regardless of which it is, everyone is in pursuit of their own One Piece in their minds.

The protagonist of this article, Merlin Chain, has been enjoying unparalleled glory in recent weeks, with total staked assets exceeding $2.3 billion. The airdrop of $VOYA to over 100,000 addresses has been met with applause, and the community meme token $HUHU has surpassed a $10 million FDV. Other Bitcoin layer-one assets like Bitmap, BRC420, are also showing potential for explosive growth. Merlin Chain, the flagship of the BTC ecosystem's exploration, is now in the final adjustment stage, preparing to set sail on a journey to discover the One Piece of the crypto world.

Alright, let's stop the emotional part and get to the main point. This article is divided into three parts, each summarized by a diagram (by @Void2Legend):

• The Bird’s Eye View of Merlin （about the trend）

• The Merlin One Piece Map （about the builders）

• The Merlin Menu （about the wealth code）

The three parts of the content aim to answer the following questions: Why build the Merlin flagship? Why has Merlin gained momentum quickly, and who is building it together? What dishes are available on board? How should one order to suit their taste?

Chapter1 The Bird’s-eye View of Merlin

Many people are puzzled by the sudden rise of the Merlin Chain. To find some explanations for their confusion, some are willing to believe in conspiracy theories, while others bluntly attribute it to "simply having money." Most people overlook the principles of "accumulating knowledge and resources" and "right timing and favorable conditions." After reviewing some materials, I believe three points are particularly meaningful:

• Bman, the co-founder of the venture capital firm ABCDE, systematically reviewed the past and present of Merlin and explained in his view why Merlin has risen: Portal

• @0xcryptowizard and Wei @coolish both mentioned that when the predecessor of MerlinChain was working on recursive inscriptions at rcsv.io, they collected users' on-chain art works and made a video to pay tribute to the community. From this small act, it can be seen that the team's culture is deeply Crypto Native. Portal

• In a conversation with MerlinChain's founder Jeff, this interview essentially reveals Jeff's thoughts. He himself adheres to a primary philosophy of simplicity, transparency, and freedom of market choice: Portal

From a macro perspective, the market capitalization of BTC's inscription ecosystem currently totals about ten billion, with BTC's market cap at a trillion. By analogy, ETH's market cap is roughly equal to the market value of its EVM tokens, from which we can roughly infer that the total volume of inscriptions and similar assets based on native networks still has nearly a hundredfold growth space. However, as the number of layer-one inscription assets gradually increases, we can clearly feel that the issuance/trading/derivative expansion of assets are constrained by the performance of the BTC network - there's a missing growth flywheel to expand the pie:

• Layer-one assets are highly recognized, and the volume of assets is beginning to scale, but transactions are limited.

• Layer-two assets offer a variety of playstyles, and transactions are convenient, but lack initial liquidity.

Writing up to this point, a not entirely appropriate but very intuitive analogy suddenly comes to mind. If a BTC is a building, then an inscription is one of the apartments within it. Although you can find apartments of the right size to buy and sell, if you're considering it as an investment, you still need to move in and out as a whole. When you don't want to trade in the short term, your funds can't be used at will. What to do? It would be great if there were an institution that could recognize this asset and lend money against it, allowing me to invest in stocks/buy art/start a business!

How does Merlin act as a growth flywheel for the BTC market?

• By attracting more L1 Native assets to come and stake, offering 20% of governance tokens to major investors to join the venture. The more friends, the fewer enemies.

• Building a stage on L2, one act follows another. With numerous shows, visitors will enjoy and stay.

• Close loop of L1-L2 assets, users participate in L1 asset inscriptions from L2, which are then automatically moved to L2 to enter the trading pool.

Conclusion：

The ETH ecosystem has gone through nearly a decade of token issuance, DEFI asset yielding, application empowerment, and performance expansion in four major narrative steps. The BTC ecosystem, after years of accumulation, shows a trend of achieving all these in one step following the explosion of inscriptions. In summary, understanding this flywheel, regardless of which stage one participates in, allows one to ride the wind.

Chapter2 The Merlin One Piece Map

This image zooms in on the bird's-eye view from the first chapter, listing the early friends of Merlin Chain. Let's see who are the esteemed individuals working together to build the Merlin flagship, and what insights they bring to the builders of the blockchain.

The top section with a yellow background primarily shows the sources of staked assets, among which assets from the BTC ecosystem account for 90%, and assets from other chains about 10%. From the staking rate, it can be seen that derivative assets on the BTC chain have found their use cases in Merlin, meeting market demand. For real-time information, you can refer to the GeniiData panel Portal 

The middle purple section represents the core developers of the Merlin ecosystem. The upper half includes developers closely connected to the technology of Merlin Chain itself, while the lower half consists of developers based on EVM L2 or those addressing gaps in ecosystem needs. Currently, each segment has a "gatekeeper" partner, all of whom are leading players in their respective markets.

With MerlinChain：

• Particle Network：The leading player in the AA(Account Abstraction) track is said to have almost more than half of the GameFi projects in the EVM market as its clients. It is precisely the demand from MerlinChain that prompted it to develop the first BTC account abstraction protocol, which allows for the secure control of EVM wallets using BTC addresses.

• Lumoz：The leading player in the zk-RaaS (Rollup As A Service) track, it possesses abundant miner resources and focuses on using market-proven zkEVM open-source modules to package and verify layer two transactions. It is also the technology provider for the ZKFair platform.

• Polygon CDK：Polygon abstracted a set of open-source modules for the chain during its transition to an ETH layer two, which includes zkEVM and an optional Valium data availability module. It is considered by the development community to be the most comprehensive L2 open-source module.

• Cobo Global：A well-known digital currency custody and wallet technology service provider. Those familiar with the BTC mining pool F2Pool should know that its founder is also the founder of Cobo, @bitfish1 . At first, I thought Cobo was providing custody services here, but upon closer look, I found that they offer multi-signature MPC services to Merlin.

• Merlin Bridge：The bridge from BTC layer one to Merlin must have required considerable effort from the officials. Coin-to-coin conversion is relatively mature, but the conversion of Inscriptions to tokens needs some innovative research and development.

• Wallet：Here, many familiar figures have already been seen. In the BTC ecosystem, leading platforms UniSat / OKX / Bitget are among the first to support interactions between L1 and L2, with Token Pocket also joining. MetaMask-like EVM wallets seamlessly integrate with L2 itself.

• Explorer and Node：

  Currently, the browser is also using open-source packages, which have limited functionality, including complex data functions. The RPC nodes are operated by the official team (please contact me if this information is inaccurate). It is estimated that more nodes will be introduced later to bring in a validator mechanism.

Conclusion：

The Merlin team, much like Apple, selects the best companies in the market for corresponding components to collaborate with, assembling them perfectly according to their own design, contributing to the BTC ecosystem an expansion solution that has never been seen before, blending BTC's asset attributes with ETH's functional properties. Naturally, it also received the same kind of mockery from the BTC native community that early keyboard phones had for Apple's all-touchscreen smartphones. Time and the market will tell us the answer, and it's still early. However, we can see that currently, traffic and funds are moving towards Merlin; wallet/node staking service providers/block explorers/RPC data service providers can consider Merlin as a new growth point.

With Merlin Eco：

• Bridge | Meson：Supported 19 chains, bridged over 2 billion US dollars, featuring low fees and fast bridging speed.

• DEX | MerlinSwap（iZumi）：iZumi is a veteran DEX project that has been deployed on multiple ETH L2s, achieving top trading volumes. This time, directly adopting the official name of Merlin to create MerlinSwap must also be a result of thorough efforts to cultivate the ecosystem. Currently, it sees nearly 9M USD in daily on-chain trading volume.

• StableCoin | BitSmilely：Will launch the bitUSD stable coin, and has also introduced the bit-Disk Black OG asset.

• Lending | BenDAO：A well-known blue-chip NFT collateral lending platform within the ETH ecosystem, expected to provide similar services for PFP-type inscriptions or BRC420.

• Staking | StakeStone：Stake ETH to earn extra income, thus achieving two benefits with one action.

• LaunchPad | MerlinStart：Aggregate ecosystem attention, Merlin ecosystem alpha window.

• Inscription Tool | UniCross：A tool platform invested in by Merlin officials, it inscribes L1 on L2 and automatically bridges to L2 to gain liquidity. It has a certain strategic positioning.

• Data | GeniiData：Focused on inscription ecosystem data, it provides Merlin with an exclusive data viewing page. The issuance of the GeniiData Genesis Pass is also one of the staked assets.

• Gaming | Mobox：One of the top projects on Binance during the GameFi era, it issued Dragonball BRC420 assets in the BTC ecosystem and developed the game DragonverseNeo in conjunction with Bitmap, as well as preparing to enhance game interactivity on Merlin by introducing L3.

The bottom part shows that, at the token & ecosystem project level, some promising targets have already emerged. In addition to the $MERL quotas that all the Merlin wizards are competing for, there are also airdropped coins $VOYA and the community meme $HuHu. These represent three different preferences: $MERL is linked to the entire Merlin ecosystem's earnings; $VOYA is a BRC20 showcase launched fairly on L2, covering all effective participating addresses in the Merlin chain; while HuHuCat has gathered a large number of active fans as a test coin meme with a cute cat image. On the project level, the focus is mainly on the BRC420 ecosystem, issuing recursive inscriptions on the BTC network and related dApps with BitMap, which is one of the main sources of growth for Merlin ecosystem assets and gameplay.

Conclusion：

The early form of the Merlin ecosystem has already shown signs of emergence, with a large number of dApps expected to be deployed in the short term, as everyone is already familiar with the EVM system from a development perspective. The greatest opportunity and conflict for developers here may be the bottom-up approach to asset issuance within the BTC ecosystem, as well as the bottom-up community culture. In other words, people first discover assets, hold them, then aggregate into communities, and finally form development pathways. This is a level 0.5 investment behavior, meaning after buying assets, one realizes they are part of the project and then chooses whether to engage in short-term speculation or join in building. The cohesiveness formed by community culture thus becomes a core competitive strength of a project.

Chapter3 The Merlin Menu

The third part, which is of most interest to many, is the wealth code of the Merlin ecosystem. As a new chain, it is still very early days. Open GeniiData to take a look at the types of staked assets, then open MerlinSwap to see the trading rankings to get a basic idea. Note, this menu only lists assets from the Merlin faction and has not yet covered inscription assets. Since MerlinChain is about to experience a surge in asset issuance, please do your own research (DYOR) for more new assets; here, we only list observed assets that are closest to the official, have frequent project progress, or have an exceptionally active community. As for how to choose, you can refer to the lower right part of the menu to see which of the signature dishes, classic dishes, and hidden menus suits your taste better.

In conclusion, after closely examining Merlin's partners and investors, it seems evident that this is currently the strongest assembly of Chinese entrepreneurs and investors in the BTC ecosystem under the prevailing trend. The veterans, battle-hardened, seem to be fully geared up to reclaim the past glory lost by Chinese miners in the global BTC hash power and Chinese entrepreneurs in the ETH L2 space. Thus, the Merlin flagship is ready, embarking on its One Piece journey, to Make Bitcoin Fun Again!

BitcoinThrough Merlin's mist and magic bold,

Where tales of justice and wisdom told.

Upon Bitcoin's Layer 2, we ride,

With Merlin's Chain as our guide.

Ordinals' treasures, in hand we hold,

Tokens and JPEGs, stories unfold.

Towards horizons where dreams collide,

On Grand Voyage, with Merlin as our guide.