The Launch of the First DAO on Bitcoin’s Layer 2: RootstockCollective

The Emergence of DAOs on Bitcoin’s Layer 2

In the past year, the world of Bitcoin has seen significant innovations with the introduction of non-fungible tokens (NFTs) and fungible tokens, alongside a surge of new layer-2 networks and staking projects. In a groundbreaking development, a decentralized autonomous organization (DAO) has been launched on Bitcoin’s layer 2, Rootstock, marking a pivotal moment where concepts traditionally associated with platforms like Ethereum are making their debut on the oldest and most established blockchain.

The RootstockCollective represents the inaugural DAO on the Rootstock layer 2. Its primary aim is to foster a collaborative environment for builders and users of the Rootstock ecosystem, as highlighted in an announcement sent to CoinDesk on Thursday. DAOs function as blockchain-based organizations where decision-making power is vested in the holders of the underlying tokens, rather than being centralized in a single authority. While DAOs have flourished within networks like Ethereum and Solana, their presence on Bitcoin has been limited, largely due to the inherent constraints regarding Bitcoin’s programmability.

Rootstock is among several layer-2 solutions devised to enhance the utility of Bitcoin. It is compatible with Ethereum’s EVM programming standard for smart contracts, which theoretically allows for the seamless migration of applications originally developed on Ethereum and related chains. The trend of building on Bitcoin gained traction early in 2023 with the launch of the Ordinals protocol, which introduced a Bitcoin-native version of NFTs. This momentum has continued with the emergence of the Runes protocol, facilitating the creation of memecoins and other fungible tokens, while the innovative BitVM computing paradigm has paved the way for enabling smart contracts on the Bitcoin network.

The RootstockCollective DAO offers an exciting opportunity for holders of the Rootstock token, RIF, as it allows them to gain voting rights by staking their tokens. Staking involves users locking their tokens to engage in the blockchain’s verification processes, thereby earning additional tokens as a reward for their participation.