Botanix Labs announced on Wednesday that it is winding down its Bitcoin-based layer-2 network, asking users to withdraw funds before July 9 or risk losing them. The project acknowledged that it failed to achieve significant product-market fit, with investors favoring wrapped Bitcoin on Ethereum L2s, and the network struggled to generate fees. Botanix, an EVM-equivalent network that launched less than a year ago, saw its total value locked drop from a peak of $26.3 million in September to $120,000, with only $10 in fees over the past day. The company raised $8.5 million in a 2024 seed round but noted that Bitcoin remains primarily viewed as a reserve asset, not a platform for DeFi applications.

Key facts

• Botanix is shutting down its Bitcoin L2 network; users must withdraw by July 9.
• TVL fell from $26.3M peak to $120,000; daily fees only $10.
• Investors prefer wrapped Bitcoin on Ethereum L2s over native Bitcoin L2s.
• Botanix raised $8.5M in 2024 seed round from Bitcoin influencers.
• CEO cited lack of product-market fit and high user acquisition costs.

KeyAudit data perspective