New Hotspot in the Bitcoin Ecosystem: The Rise and Concerns of Odin.fun

Recently, a project called Odin.fun has sparked a small wave of excitement in the cryptocurrency circle. It is a token launch platform based on the Runes protocol, operating similarly to other projects on public chains. The emergence of Odin.fun has brought a hint of vitality to the long-quiet Bitcoin ecosystem.

However, on March 7th, community members discovered that 74 Bitcoins on the Odin.fun chain had mysteriously disappeared, suspected to be the result of a hacker attack. The project co-founder later responded on social media, stating that this was due to an error in the deposit synchronization code that caused some users' balances to display more than their actual deposit amounts; in reality, users' funds were not affected.

Looking at the relationship between public chains and token launch platforms, a hot token launch platform often brings a large amount of traffic to its associated public chain. However, unlike token launch platforms on other public chains, Bitcoin ecosystem projects like Odin.fun do not run directly on the Bitcoin main chain. To optimize user experience and reduce transaction costs, they are typically built on top of Bitcoin's second-layer network. A major risk of this architecture is that these projects find it difficult to fully share the security of the Bitcoin main chain, and Odin.fun's "hacker blunder" incident is a concrete manifestation of this issue.

What is more worth discussing is whether token launch platforms built on layer two networks, like Odin.fun, can truly bring enough momentum and attraction for the revival of the Bitcoin ecosystem?

Product Design Philosophy of Odin.fun

Odin.fun was launched in February 2025, founded by a creator of a certain Bitcoin ordinal market, and is essentially a token launch and trading platform based on the Runes protocol. According to official data, within a month of its launch, the trading volume surpassed 1000BTC, with the number of active addresses exceeding 37,000, and its flagship token's market cap once exceeded 35 million dollars.

The Runes protocol is not a brand new concept; it emerged after the Bitcoin halving in 2024. Following the introduction of the Ordinals inscription protocol and the BRC-20 token protocol, developers proposed the Runes protocol to address issues such as low transfer efficiency and UTXO expansion existing in BRC-20. The emergence of these protocols has brought new ways of asset issuance to Bitcoin, driving explosive growth in the Bitcoin ecosystem and related infrastructure in 2023 and 2024.

The innovation of Odin.fun lies in its improvements to the asset issuance and trading methods of the Runes protocol. As a token launch platform, its key to success depends on whether it can provide users with a good "speculative" experience.

In terms of specific user experience, Odin.fun has achieved second-level issuance and one-click trading of Runes assets. The platform claims that by adopting the second-layer solution Valhalla, it can complete transaction final confirmation within 2 seconds. In addition to high-speed trading, users can also enjoy convenient features such as account abstraction ( no social login ), gas-free transactions, and no need for repeated signature confirmation.

These optimizations are mainly due to Odin.fun hiding the complexity of the underlying chain. As a second-layer product beneath the Bitcoin main chain, the official has named its second-layer solution Valhalla. Users need to create an account using a Bitcoin wallet and recharge Bitcoin into the platform account, and this process is essentially cross-chain transferring Bitcoin to the project's second-layer network.

Although the second-layer solution brings convenience to users, the official has not disclosed detailed technical implementation methods. This "hacker blunder" incident has also exposed potential vulnerabilities or immaturity in its technology.

According to the explanation of the co-founder, the funds deposited by users will be placed in a decentralized 12/34 threshold signature setup to ensure the security of BTC. These funds are then sent to the platform's smart contract. All users' BTC is pegged to the BTC on the platform at a 1:1 ratio. The "disappearance" of the 74 Bitcoins was actually due to a display issue caused by a deposit synchronization error.

Regarding the security guarantee of user funds, the official statement is that it is achieved through a multi-signature method. However, multi-signature does not provide absolute security assurance. Essentially, users entrust their assets to the platform for management, which is similar to the logic of centralized exchanges.

Some analyses suggest that the BTC held by users on Odin.fun actually exists as wrapped BTC on a certain public chain. This public chain does not require a cross-chain bridge with the Bitcoin mainnet, and its smart contracts can interact directly with other networks, so its security might be higher than that of wrapped BTC generated through a typical cross-chain bridge.

As a token issuance and trading platform, the token trading rules of Odin.fun are as follows: The token launch process is called Ascend, which is the process of token binding. Newly created tokens are initially traded along a binding curve, with 80% of the token supply sold at a price of 0.211 BTC. The initial price of the token is 0.11 sats( with a market value of 3000 USD), and Ascend is completed at 4.76 sats( with a market value of 100,000 USD).

After completing Ascend, the project enters the AMM phase. The remaining 20% of the token supply and 0.2BTC are deposited into the AMM pool to support subsequent trading. From then on, token trading will follow the AMM curve k = X * Y, instead of the previous binding curve y = e^x.

Platform users can not only launch and trade tokens but also participate in liquidity provision (LP). In addition, the platform adopts a referral rebate marketing model, where 25% of the platform fees belong to the referring users.

Can Odin.fun Lead the Revival of the Bitcoin Ecosystem?

Currently, the development trend of the Bitcoin ecosystem is not optimistic, lacking projects that can ignite widespread participation. This results in difficulties in attracting funds and traffic to bring a new wave of enthusiasm to the Bitcoin ecosystem.

Although Odin.fun has generated some buzz to a certain extent, its influence seems limited. Compared to other token launch platforms that were once popular on public chains, Odin.fun has not sparked the same scale of on-chain activity in the Bitcoin ecosystem. The highest total market capitalization of its leading token has only reached 35 million USD.

It is worth noting that similar "meme coin pump" models have appeared multiple times in the Bitcoin ecosystem, such as Satspump.fun on a certain layer two network, Lnpump.fun on the Lightning Network, and Stx.city on a certain sidechain. However, these projects have not managed to achieve the same level of influence as comparable platforms on other public chains.

As a latecomer, Odin.fun finds it difficult to surpass the already successful predecessors. More importantly, these meme coin pump platforms on layer two or sidechains lack the legitimacy of the Bitcoin mainchain. Odin.fun is able to attract some attention mainly because it combines Runes, a new asset issuance method closely associated with the Bitcoin mainnet, with the current market's lack of hot topics for speculation during this cold period.

However, the influence of Odin.fun seems to have reached its limit. For the Bitcoin ecosystem, it lacks the unique innovation and hype potential of inscriptions, and only superimposes two narratives of outdated runes and meme coin pumps. Therefore, the enthusiasm that this project itself can generate is limited, making it difficult to undertake the important task of leading the revival of the Bitcoin ecosystem.

For investors, it is important to remain cautious when participating in such projects and to only invest small amounts of funds. When choosing potential tokens, one can pay attention to community activity and funding support. However, it is essential to recognize that this is essentially closer to a speculative behavior, similar to the gameplay of meme coins.