Is Ethereum really a test chain for Bitcoin?

This article is written by Aaron Zhang, Managing Partner of Chain Renaissance Capital (x:@zzmjxy)

This issue has become a meme in the crypto community, but it hides a deep misunderstanding of the technical routes of the two ecosystems. Let's peel back the surface jokes and see what the technical reality actually is.

Modular Era: Is Ethereum Moving Closer to Bitcoin?

The most interesting phenomenon is that Ethereum is dismantling itself. Ethereum's Rollup-centric roadmap essentially says: we no longer need to perform complex calculations on L1; let Rollups handle the execution, while the main chain is only responsible for consensus and data availability.

Does this sound familiar? This is the design philosophy of Bitcoin from day one — the main chain remains simple, while complex functions are delegated to the second layer. The Lightning Network implemented this idea back in 2018, and now the RGB protocol has taken this model to the extreme.

So the question arises: if Ethereum's final form is to "only serve as a consensus layer," do we still need a new chain for consensus? Bitcoin already has the strongest security budget and the most decentralized network in the world, so why not just use it directly?

When Ethereum pushes all application logic to Rollup, it is actually acknowledging the correctness of Bitcoin's design. Off-chain execution, on-chain verification — isn't this the core idea of RGB?

The Vitalik Effect: The Contradiction Between Innovation and Decentralization

The fastest period of innovation for Ethereum coincides with the time when Vitalik's influence was at its peak. From smart contracts to DeFi, from EIP-1559 to the PoS transition, these groundbreaking advances are all inseparable from the strong support of the core team.

But what about now? Ethereum's governance has become increasingly decentralized, EIP proposals require more consensus, and hard forks have become more cautious. The cost of this decentralization is a slowdown in the pace of innovation.

In contrast, Bitcoin has maintained an extremely conservative development model, but this philosophy of "slow is fast" has allowed it to maintain a record of zero major security incidents over the past 16 years. When your security budget reaches hundreds of billions of dollars, stability is more important than speed.

Technical Debt: The Truth about VMs

Opponents always say: Bitcoin's VM is too weak to run complex ZK verifications. This statement is both true and not true.

Bitcoin Script is indeed not Turing complete, but this is a design choice, not a technical flaw. Satoshi intentionally limited the complexity of the script because he knew that simpler systems are more secure.

But this does not mean that Bitcoin cannot do complex things. Taproot has unlocked more powerful scripting capabilities, and the RGB protocol has implemented a complete state machine on Bitcoin. The key is to understand: you do not need to do everything at the base layer.

The EVM of Ethereum executes each smart contract on the mainnet, which was necessary in the early days but now seems like a technical debt. Why should all nodes on the network execute your DEX trading logic? This is why Ethereum is turning to Rollup.

UTXO vs Account Model: Which is More Suitable for Modularity?

This is one of the most misunderstood technical debates.

Traditional views suggest that the account model is more suitable for complex applications because you can directly read the balance status. However, in the era of modularization, this advantage has turned into a disadvantage.

The biggest advantage of the UTXO model is parallelism. Each UTXO is independent and can be verified in parallel, which is a huge advantage for layer two networks. Do you see why the Lightning Network is so efficient? Because each channel is an independent UTXO.

Moreover, who says UTXO cannot be used for account models? If you need account balances, you can fully implement it through log replay, just like the Electrum server does. UTXO provides a lower-level abstraction on which you can build any model.

The account model of Ethereum seems convenient, but it enforces the concept of global state. In a modular world, this has become a burden.

Security Budget: The Real Rules of the Game

Let's return to the fundamental question: what is the core value of blockchain? It is the security of decentralization.

The Bitcoin mining network consumes a massive amount of electricity, which is often criticized as "wasteful." However, this "waste" creates the most powerful security budget in the world. The cost of attacking the Bitcoin network is astronomical, something that no PoS network can compete with.

When your layer two network is handling trillions of dollars in value, the security of the underlying layer is everything. Ethereum's PoS, while more "green," bases its security on economic incentives rather than physical costs. Theoretically, an attacker with enough capital could buy a large amount of ETH to attack the network.

This is why more and more projects are choosing to build layer two solutions on Bitcoin. RGB, Lightning, and even some DeFi protocols are all leveraging Bitcoin's security budget.

OP_CAT: Misunderstood Complexity

Many people believe that Bitcoin needs OP_CAT to achieve complex functions, but this is another misunderstanding.

The recovery of OP_CAT will indeed make Bitcoin stronger, but the current Taproot is already strong enough. With MAST and Schnorr signatures, you can implement very complex script logic, and it appears on-chain just like a regular transaction.

More importantly, complexity should not be solved at the base layer. If you need Turing-complete computation, go to layer two. The responsibility of the base layer is to provide security and consensus, not to run your game logic.

Reality Check: The Market is Speaking

Technical debates are interesting, but the market does not lie.

The RGB protocol will officially launch in July 2025, and Tether has announced that it will issue USDT on Bitcoin. This is not a technical experiment; it is a demand from the real world. What does it signify when the world's largest stablecoin issuer chooses Bitcoin as its new issuance platform?

At the same time, Ethereum's Layer 2 ecosystem is experiencing explosive growth, but most users don't even know which Rollup they are using. This proves a point: users do not care about the underlying technology; they care about security, cost, and experience.

Under this standard, Bitcoin + layer two solutions have surpassed Ethereum L1 in many scenarios.

Re-defining "test chain"

So, is Ethereum really a test chain for Bitcoin?

In a sense, yes. Ethereum has validated many concepts: smart contracts, DeFi, NFTs, Rollup technology. However, after these validations are completed, actual deployments often choose safer and more decentralized platforms.

But this is not to belittle Ethereum. The value of Ethereum lies in innovation and experimentation, which are essential to the crypto ecosystem. Without Ethereum, we wouldn't have DeFi; without the concept validation of DeFi, RGB wouldn't know what functionalities to implement.

The real question is not who is the test chain of whom, but how to understand the positioning of the two systems:

• Ethereum: A rapidly iterating experimental platform focused on application layer innovation
• Bitcoin: A robust settlement layer focused on value storage and ultimate security.

The Future is Here: The Victory of Modularity

The trend of modular blockchain has become irreversible. Whether it's Ethereum's Rollup or Bitcoin's RGB, they are all proving the same point: specialized division of labor is more efficient than a monolithic architecture.

In this new paradigm, the value of the base layer lies not in the richness of its functions, but in the strength of its security. Bitcoin has an undisputed advantage in this regard.

Of course, Ethereum will not disappear. It will continue to serve as a breeding ground for innovation, validating new concepts and technologies. However, when these concepts mature, deploying them on Bitcoin's layer two solutions may be a better choice.

This is not a zero-sum game; it is the natural division of labor in an ecosystem. Just as the internet has the TCP/IP protocol stack, the crypto world is also forming its own protocol stack. Bitcoin provides the foundational security and consensus, while Ethereum and other platforms offer innovation at the application layer. In the future, we may see BTC as the security layer, with Ethereum L2 or even shared security returning to BTC.

Ultimately, the term "test chain" may need to be redefined. In the rapidly evolving technological landscape, every platform is a "test chain" in some sense; the key is how to learn from testing and apply best practices to the most suitable infrastructure.

The Truth about the Technical Route

Let me be more straightforward: the choice of technology route often reflects the choice of values.

Ethereum chose flexibility and speed of innovation, at the cost of complexity and potential security risks. Bitcoin chose simplicity and security, at the cost of slow feature development.

But in the era of modularity, this trade-off becomes less important. You can build Ethereum-level functionality on the secure foundation of Bitcoin. RGB is the best proof of this.

So, is Ethereum a test chain for Bitcoin? The question itself is wrong. They are not in a competitive relationship, but rather a cooperative one. Ethereum validates concepts, while Bitcoin provides a deployment platform. This is how the crypto ecosystem should look.

Technology will ultimately converge to an optimal solution. In the field of blockchain, the optimal solution might be: the most secure base layer + the most flexible application layer. Bitcoin provides the former, while Ethereum ( and other innovative platforms ) explore the latter.

This is not a story of who replaces whom; it is a sign of the entire industry's maturation.