Arch: Bitcoin’s Execution Play

Ape-tizers:

• For years, BTC was just a “hold and hope” asset. Arch changes that by bringing a Rust-based VM directly into Bitcoin’s UTXO model for devs to build DeFi, NFTs, and DAOs without bridges or wrappers.
  
• ArchVM + Titan gives BTC a real developer stack. Pre-confirmations, rollback safety, and cross-program composability unlock apps that simply weren’t possible on Bitcoin before.

• Testnet already has Saturn (DEX), Autara (money markets), VoltFi (derivatives), Ordeez (BNPL for Ordinals), and HoneyB (RWAs). It’s a live ecosystem proving Arch Network is working at scale.
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It’s no secret that most of us don’t have a single ounce of bitcoin in our wallets. It’s stables and alts, maybe some dusty airdrop bags, but rarely any Bitcoin. That’s just how the space has evolved, and that’s pretty much the norm.

Bitcoin sits there as the $2.2 trillion heavyweight that moves the market, but even for most retail, it’s been more of a spectator asset than something they actively touch.

It's been the same story when it comes to building. The irony is that the most secure and liquid network in crypto hasn’t been the one people innovate on.

Old hands will tell you Bitcoin was never meant to stop at “number go up.” It was supposed to be usable money, not just something you bury in multisig.

But along the way, it got boxed into being the backdrop asset while all the experimentation moved to Ethereum, Solana, and elsewhere.

Well, that might’ve been the case until recently. A recent survey run with builders and investors showed a massive surge in usage for Bitcoin DeFi, as TVL climbed from a few hundred million to over $8 billion over the past year.

For the first time in a long while, it’s starting to look like BTC isn’t just sitting cold in multisig but is actually being put to work.

Lending apps are leading that charge. Reports show momentum coming from everywhere – Asia is a huge driver, new teams are entering, and investors are lining up with the kind of conviction you don’t usually see outside of ETH or SOL.

And really, none of this should be surprising. What Bitcoin always lacked was the proper infrastructure.

That’s the part Arch is stepping in to build. It’s a network trying to give Bitcoin the same kind of programmable toolkit that Ethereum and Solana users take for granted.

What is Arch Network?

Arch is a Bitcoin-native application platform that brings smart contracts directly to Bitcoin’s base layer. In the simplest sense, it’s an attempt to make Bitcoin programmable in a way that doesn’t feel like patching smart contracts onto it.

Instead of treating Bitcoin like a passive rock that needs to be bridged, wrapped, and rewrapped ten times before it becomes useful, Arch builds an actual execution layer on top of Bitcoin.

The team behind Arch isn’t fresh off any hackathon either. They’re well-experienced and have been building the network since 2023 with funding raised from names like Multicoin, OKX Ventures, Big Brain, and CMS Holdings.

Earlier this year, Arch also raised $13 million, led by Pantera. They plan to deploy the capital across three main priorities: scaling its core engineering team, growing the ecosystem, and expanding developer adoption.

The focus is squarely on infra as the project pushes toward mainnet launch. To accelerate that path, Arch Labs is also rolling out grants, developer tooling, and community programs.

This kind of early support shows there’s an appetite for a Bitcoin-native execution layer that doesn’t compromise on security or liquidity.

Arch’s working mechanics

In essence, Arch is basically asking: how do you make Bitcoin programmable without breaking what makes Bitcoin, Bitcoin?

Well, the answer to that isn’t to slap on another sidechain or force users through bridges. We’ve already learned that. It’s to build an execution layer that anchors back to Bitcoin itself.

To pull that off, Arch blends some familiar pieces (delegated proof-of-stake, a VM, an indexer) with some very Bitcoin-native cryptography.

The next few sections will tell you exactly how those parts fit together.

Consensus layer

Arch runs on a delegated proof-of-stake (dPoS) model.

Validators stake Arch tokens to earn leader slots, and leaders are the ones who gather and order transactions into blocks. Nothing unusual there, except once blocks are finalized, transactions get settled back onto Bitcoin itself.

That’s what makes Arch different from a sidechain or wrapped-BTC setup, since the state is anchored directly in the most secure base layer crypto has.

Threshold signatures

The bridge-free design works because of Arch’s cryptographic backbone: FROST and ROAST threshold signatures.

• FROST (Flexible Round-Optimized Schnorr Threshold): No single validator can push a transaction through. You need a majority of validators signing off (51%+).
  
• ROAST (Robust Asynchronous Schnorr Threshold): Makes the system practical in the real world by letting validators drop in or out between epochs without halting consensus.

Together, they distribute trust across the validator set and extend Bitcoin’s security guarantees to every Arch contract.

The ArchVM

Building on Bitcoin has always been painful. Script isn’t built for smart contracts, block times kill UX, and apps can’t talk to each other. Most devs gave up and went to Ethereum or Solana.

Arch’s answer was to build the ArchVM. A Rust-based environment that plugs straight into Bitcoin’s UTXO model without needing bridges or sidechains.

• Programmability: Script is too limited, so ArchVM lets devs write expressive Rust programs that can directly handle BTC, Runes, and Ordinals.
• Speed: Waiting 10 minutes per block is useless for DeFi. Arch adds pre-confirmations, anchored back to Bitcoin, with rollback protection if a transaction gets reorged.
• Composability: Bitcoin apps don’t naturally talk to each other. Arch uses an accounts-based model with cross-program invocation, so one smart contract can call another seamlessly.

Put simply, ArchVM gives Bitcoin the developer experience it never had.

It’s a custom execution environment forked from eBPF. Unlike EVM chains, ArchVM is tuned to play nice with Bitcoin’s UTXO model.

It comes with syscalls that directly handle UTXOs and Taproot addresses, so users don’t need to jump through hoops.

If this went over your head (it did at first for me), it basically means you can run DeFi apps, NFT marketplaces, or DAO contracts on Arch while still interacting with your regular Bitcoin wallet. There isn’t a need for wrapping or bridges.

State and indexing

Keeping all of this responsive requires a better indexing system than Bitcoin’s defaults. That’s where Titan  comes in, Arch’s custom-built indexer. Titan operates at the mempool level, meaning it tracks unconfirmed transactions in real time.

It also has built-in support for Runes, giving developers immediate visibility into token states, balances, and transfers. For dApps, that basically means faster UX, fewer failed transactions, and protection against common issues like front running. All the good stuff, eh?

But it doesn’t stop there. Titan goes further by delivering faster queries than standard indexers, real-time data access, and interfaces built specifically for Arch. The result is smoother developer workflows and, more importantly, reliable pre-confirmations (core feature of Arch), making Titan a critical piece of this stack.

Alright, maybe that’s too much to digest at once, so at a high level: consensus locks in blocks, threshold signatures secure them, ArchVM executes the smart contracts, and Titan keeps everything quick and transparent.

Bitcoin, but actually usable

For over a decade, we’ve seen how Bitcoin has been the ultimate “hold and hope” asset. Everyone respects it, everyone tracks its price, but very few use it. That could very well change with Arch.

Here’s what using Arch looks like in practice:

• Seamless wallets -  Arch ties directly into Taproot, so you can use wallets you already trust (Xverse, Unisat, Ledger, etc.) to interact with apps. There won’t be a need for any extra accounts, nor will you have to move BTC offchain. You’re still transacting from your regular Bitcoin wallet, just with added functionality.
  
• Liquidity and trading - Arch makes it possible to run DEXes, AMMs, and liquidity pools directly on Bitcoin. Developers can build protocols that settle BTC swaps and liquidity provision natively, instead of routing through wrapped tokens or centralized desks.
  
• Borrowing and lending - With programmable contracts on ArchVM, markets can support both overcollateralized and undercollateralized lending. That means earning yield on BTC directly or using it as collateral, without relying on offchain lenders or opaque custody setups.
  
• Synthetic assets & derivatives - Arch’s execution environment and Titan indexer allow Bitcoin-native assets like Ordinals, Runes, and BRC-20s to move beyond collectibles. They become composable with DeFi apps, opening the door to synthetic stablecoins, tokenized assets, and even decentralized derivatives, all anchored to Bitcoin security.

The bigger picture here is that this isn’t just good for investors, it’s good for Bitcoin itself.

In the words of @Saturn_btc’s founder, "You're not building on Arch. You're building on Bitcoin."

First movers on Arch

We’ve covered how the Arch mechanics work, but the real test is what people are actually building with it.

Infra is only as good as the apps that live on top, and even in testnet, Arch’s ecosystem is already showing signs of life. Let’s run through a few standout projects and get a feel for what Bitcoin DeFi might look like once the mainnet is live.

➤ Saturn (DEX & Liquidity Hub)

Saturn was the first DEX to go live on Arch’s testnet, bringing AMM-based swaps for Bitcoin-native assets without relying on bridges.

It laid down the base liquidity pools for tokens like Runes (BDC, PUPS, and others) and plugged into the wider ecosystem through ArchVM’s cross-program composability. Since launching in December 2024, it’s already processed millions of swaps, making it the de facto liquidity hub for early Bitcoin DeFi.

It’s also become a bit of a poster child for Arch, showing up in official comms and even handing out XP through testnet missions.

➤ Autara Finance (Money Markets)

Autara Finance is Arch’s native money market, letting users lend BTC or borrow against it without bridges or wrappers.

It runs directly on the UTXO model, with isolated pools to manage risk and customizable oracles for reliable pricing. It’s pretty much shaping up to be a secure backbone for Bitcoin liquidity and capital efficiency inside Arch.

➤ VoltFi (Derivatives)

VoltFi is building Bitcoin’s first real derivatives hub, starting with a VIX-style volatility token that lets traders hedge or speculate on BTC swings.

It’s powered by Arch’s parallel engine and Titan indexer, and runs options and hedging products at speed without settlement drag.

Even on testnet it’s clocked 59,000+ trades and 13 BTC in volume, and the roadmap points to a full suite of structured products, covered calls, and volatility swaps (essentially the go-to venue for pro-grade derivatives on Bitcoin).

➤ Ordeez (BNPL)

Ordeez brings the first BNPL (Buy Now, Pay Later) to Ordinals, turning Bitcoin NFTs into yield-bearing assets.

It uses DAG-based transaction management and Arch’s rollback system to stay stable, and has been a key part of testnet missions. Ordeez is positioned as a native financial tool, and aims to expand liquidity and utility in the Bitcoin NFT and Ordinals market.

➤ HoneyB (RWAs)

HoneyB is Arch’s big bet on real-world assets. Think gold, private credit, even trade finance, but running directly on Bitcoin instead of some wrapped side-token.

They’ve teamed up with Chintai, a serious name in institutional RWA infrastructure, to handle the boring but crucial parts like compliance and lifecycle management.

They’re starting with gold but have their sights set on broader credit markets and structured products, making it one of the clearest examples of how Arch could connect Bitcoin to multi-trillion-dollar traditional markets.

Concluding thoughts

We’ve seen a rise in attempts at bitcoin execution layers recently, and understandably so. The stats show why. But the thing I keep coming back to with Arch is that it doesn’t feel like another “Bitcoin Layer” pitch.

I’ve seen enough of those over time, and most of them boil down to “send us your BTC, trust our multisig, and we’ll give you a wrapped version to play with.” Arch isn’t that.

What makes me optimistic is less about the whitepaper and more about the early ecosystem. Seeing people actually build DEXes, lending markets, even casinos on testnet tells me the dev experience is real.

To top it all, the support that the project has for that setup is something in and of itself – they put out a weekly newsletter packed with insights and guidance for devs looking to get the most out of the ecosystem. This kind of dedication and intent from a project, and for a narrative this strong, makes it all the more refreshing.