SatLayer Overview
SatLayer connects Bitcoin restakers, BVS developers, and node operators to power secure Bitcoin Validated Services
Last updated
SatLayer connects Bitcoin restakers, BVS developers, and node operators to power secure Bitcoin Validated Services
Last updated
Think of SatLayer as a marketplace where we connect Bitcoin restakers, BVS developers and node operators to bring cryptoeconomically secured services to life.
The SatLayer ecosystem consists of the following participants:
Bitcoin restakers enhance cryptoeconomic security by depositing and restaking their Bitcoin assets, delegating them to node operators. If a node operator acts maliciously, these assets face the risk of being slashed, reinforcing cryptoeconomic security. In exchange, Bitcoin restakers earn rewards. Bitcoin restakers can currently restake wrapped Bitcoin and specific Bitcoin LSTs through the SatLayer Staking App.
Bitcoin Validated Services (BVS) developers can address the cold-start problem—where new services and protocols are initially insecure—by launching services secured through SatLayer using staked Bitcoin. These services, called Bitcoin Validated Services (BVS), derive their security from the amount of Bitcoin backing them (i.e staked Bitcoin).
Node operators are responsible for running nodes to validate BVSes, using stakes delegated to them by Bitcoin restakers. In exchange for providing the validation service, computing resources, and expertise required to run the node operator software required for validation, these node operators take a portion of the rewards as their fee.
In addition, node operators can choose which BVS applications to secure where their fees increase and decrease based on their selection. As a permissionless protocol, SatLayer does not dictate how much stake, or how many BVSes a node operator needs to secure. The market will decide which BVSes gain the most support by way of validation, and which node operators can win the trust and delegation of Bitcoin restakers.
SatLayer offers the above-mentioned framework for developers to build BVS systems secured by Bitcoin assets staked in our contracts. It features a clean and straightforward abstraction while allowing flexibility for both on-chain and off-chain components. Similar to Next.js or React, SatLayer acts as a modular lego block for developers' customization and creativity.
A BVS relies on economic incentives and risk mechanisms to discourage malicious behavior in off-chain processes. The economic defense works as follows:
Each BVS enforces a set of "slashing conditions" within its on-chain contract. When a slashing condition is met, node operators who violate these rules have a portion or all of their stake confiscated. BVS developers have considerable flexibility in managing these slashing conditions and outcomes — slashed assets can be redirected as protocol revenue or permanently burned by sending them to a null address.
This structure creates a financial incentive for node operators to behave responsibly, as they risk losing their collateral and assets if malicious behavior is detected. Meanwhile, restakers are motivated to deploy assets with trustworthy node operators and monitor for potential risks.
In practice, slashing conditions for a real-world BVS are likely complex and often require cryptographic proof of malicious activity. Slashes are validated and executed on-chain. Thus, developers must ensure that (a) slashing remains affordable to execute to deter unchecked malicious activity, and (b) slashing is secure against misuse to prevent false triggers.
By accepting the risks associated with slashing, restakers earn rewards as defined by the BVS developers, distributed through the SatLayer ecosystem. These rewards may come from the BVS’s native tokens or other specified assets.
