Last updated: October 2026
Merlin Chain is an EVM-compatible network that markets itself as a Bitcoin Layer 2: you deposit BTC or Bitcoin-native assets such as BRC-20 tokens, receive representations on Merlin, and use them in Ethereum-style DeFi apps. It was launched in February 2024 by Bitmap Tech, the team behind the Bitmap and BRC-420 Ordinals projects, and briefly became the largest “Bitcoin L2” by deposits, with billions of dollars locked within weeks. Its governance token is MERL. The important nuance: Bitcoin does not enforce Merlin’s rules, so users rely on Merlin’s bridge operators rather than Bitcoin’s own security.
New to this topic? Our Coin Directory lays out the options and links every related guide.
What Is Merlin Chain?
Bitcoin’s base layer has limited programmability, which leaves most BTC idle. Merlin is one of several projects trying to bring lending, trading and yield to BTC holders without moving them to Ethereum. It uses Ethereum’s virtual machine so developers can reuse Solidity contracts, and it anchors data about its state to Bitcoin.
- Key takeaway: Merlin is a sidechain-like rollup design whose BTC deposits are secured by an MPC custody bridge, not by Bitcoin consensus.
- Key takeaway: Its 2024 growth was driven by the “Merlin’s Seal” points campaign, which rewarded deposits with future MERL.
- Key takeaway: MERL has a 2.1 billion total supply distributed over four years; a large share was still vesting in 2026.
- Key takeaway: Bridged BTC on Merlin (M-BTC) is only as safe as the bridge that backs it.
History & Origin Story
Merlin emerged from the 2023 Ordinals boom, when inscriptions and BRC-20 tokens created a new class of Bitcoin-native assets and a community, much of it in Asia, eager to do more with them. Bitmap Tech had built a following through Bitmap (an Ordinals-based “metaverse land” project) and the BRC-420 “Blue Box” collection. It partnered with digital-asset custodian Cobo, whose MPC (multi-party computation) technology secures the bridge, to build Merlin.
Before mainnet, the team ran Merlin’s Seal, a staking campaign that accepted BTC, Ordinals assets and BRC-20 tokens in exchange for points convertible into MERL. Deposits poured in. By the time mainnet opened in February 2024, the team was reporting more than $3 billion in value locked, with roughly $1.75 billion in BTC and close to $1 billion in BRC-20 assets, according to its April 2024 launch release. Over 200 apps were announced on the network.
MERL launched on 19 April 2024, the eve of Bitcoin’s fourth halving, with listings on OKX, Bitget, Bybit, KuCoin, Gate and others. Like most points-funded launches, it traded sharply lower after the initial airdrop selling and through subsequent unlocks. Activity on the chain also cooled once incentives faded and capital moved to newer Bitcoin-yield products such as Babylon-based staking.
Since then Merlin has continued to expand M-BTC to other networks and to promote BTC yield products, while the broader Bitcoin L2 sector has become crowded with competitors including Stacks, BOB, Bitlayer, Core and Citrea. Market data in 2026 showed MERL trading far below its launch-period highs, with a market capitalisation in the tens of millions of dollars.
How Merlin Chain Works
- Bridge and custody: BTC deposited to Merlin sits in addresses controlled through Cobo’s MPC co-custody with Merlin; both parties apply risk policies before signing withdrawals. Independent analysts describe this as a trust-based model: users cannot force a withdrawal on their own if operators stop cooperating.
- M-BTC: Minted 1:1 when BTC is bridged in and burned on withdrawal.
- Execution: An EVM-compatible environment where a sequencer orders transactions.
- Proofs and data: Merlin describes a ZK-rollup design, with ZK proofs generated through its partnership with Lumoz and state data anchored to Bitcoin via Taproot inscriptions, plus a data-availability committee. A fraud-proof module has been planned; check current documentation for what is live.
- Wallet access: Particle Network’s BTC Connect lets Bitcoin wallets such as UniSat and OKX Wallet interact with Merlin apps, alongside standard EVM wallets.
Anchoring data to Bitcoin is not the same as Bitcoin securing your funds. Bitcoin miners do not verify Merlin’s proofs, so the guarantees come from Merlin’s operators and committees. Our Layer 2 explainer shows how this differs from Ethereum rollups, where the base layer verifies proofs or fraud claims.
Merlin vs Other Bitcoin Layer 2s
| Network | How BTC gets in | Execution | Main trust assumption |
|---|---|---|---|
| Merlin Chain | MPC bridge co-run with Cobo | EVM | Bridge signers and Merlin’s committees |
| Stacks | sBTC, a threshold-signer peg | Clarity smart contracts | Signer set staking STX |
| BOB | Bridged BTC variants | EVM (OP Stack hybrid) | Ethereum-style rollup plus BTC bridges |
| Citrea | BitVM-based bridge design | EVM zk-rollup | Aims for trust-minimised verification via BitVM |
The comparison shows why “Bitcoin L2” is a loose label. Every option relies on some group of signers or a novel bridge design, because Bitcoin itself cannot yet verify another chain’s state. When choosing where to put BTC to work, compare who can move the deposited coins, whether there is an escape hatch if operators disappear, and how long the system has run without incident. Merlin’s advantages are a large early community and broad exchange support; its weakness is a custody model that is closer to a federated sidechain than to a rollup.
For price scenarios on a token built around Bitcoin smart contracts, see our Stacks STX price prediction, which is speculative, not a reliable forecast.
Tokenomics & Supply
MERL has a total supply of 2.1 billion, issued originally as a BRC-20 token and usable on Merlin Chain. The launch allocation published in April 2024 listed:
- Merlin’s Seal airdrop: 20%
- Community rewards: 16.57%
- Grants and incentives: 40%
- Private investors: 15.23%
- Core team: 4.20%
- Advisers: 3%
- Public sale: 1%
Distribution runs over roughly four years from 2024, so unlocks continue to add supply through 2028. MERL is used for governance and ecosystem incentives. For how to weigh unlocks like these, see what is tokenomics.
How to Use Merlin Chain and Buy MERL
Getting BTC onto Merlin
- Check whether your exchange supports withdrawals directly to the Merlin network; some, such as OKX, have offered this, which avoids using a bridge yourself.
- Otherwise, use the official Merlin bridge from Bitcoin. Connect a Bitcoin wallet (UniSat or OKX Wallet), deposit BTC and receive M-BTC on Merlin.
- For EVM wallets, add Merlin Chain to MetaMask using the network details from Merlin’s official docs or Chainlist, and keep a little BTC on Merlin for gas.
- Send a small test amount first and expect withdrawals back to Bitcoin to take longer than deposits.
Before bridging meaningful sums, read is bridging crypto safe?, since bridge failures are among the largest causes of crypto losses.
Buying MERL
MERL is listed on several centralized exchanges, including OKX, Bybit and Gate, and trades on DEXs on Merlin. Availability depends on your country. Use limit orders, as liquidity is thinner than for large tokens.
Risks & Is Merlin Chain a Good Investment?
- Custodial bridge: Funds depend on MPC signers behaving honestly and staying secure.
- Incentive-driven usage: Much of the 2024 activity was points farming; organic demand is harder to measure.
- Unlocks: Vesting continues into 2028.
- Competition: Stacks, BOB, Citrea, Core and Babylon-based products all compete for BTC deposits.
- Transparency: Verify current TVL on independent sources such as DefiLlama rather than project announcements, and note whether figures count bridged assets held elsewhere.
- App risk: DeFi apps on Merlin are newer and less audited than Ethereum blue chips; one exploited lending market can trap deposits even if the bridge is fine.
The optimistic case is that Bitcoin DeFi grows and Merlin keeps its early-mover community. The pessimistic case is that capital moves to more trust-minimised designs. For a comparison with the oldest Bitcoin programmability layer, read our Stacks guide, and for more Bitcoin-focused reading browse the Bitcoin guides hub.
FAQ
Is Merlin Chain secured by Bitcoin?
Not in the way Ethereum rollups are secured by Ethereum. Merlin anchors state data to Bitcoin, but Bitcoin nodes do not verify Merlin’s transactions or enforce withdrawals. Deposited BTC is held through an MPC bridge co-managed with Cobo, so users trust those operators. Treat it as a separate network with its own trust assumptions.
Who created Merlin Chain?
Merlin Chain was created by Bitmap Tech, the team behind the Bitmap Ordinals project and the BRC-420 standard, with custody partner Cobo providing the MPC technology for its bridge. Mainnet opened in February 2024 and the MERL token launched in April 2024.
What is M-BTC?
M-BTC is Merlin’s representation of Bitcoin. It is minted 1:1 when BTC is bridged onto Merlin and burned when it is withdrawn. Its value depends on the bridge reserves remaining intact, which makes it similar in risk profile to other custodial forms of wrapped Bitcoin.
Is MERL a good investment?
MERL is a small-cap governance token with ongoing unlocks and heavy competition, and it has fallen sharply from its 2024 launch levels. Its value depends on Merlin retaining BTC deposits and users. It suits only a small speculative allocation, if any.
Crypto is volatile and risky; this is education, not financial advice. Do your own research.
