Botanix Labs announced the closure of its second layer (L2) network for Bitcoin, known as Spiderchain, after more than a year of operation on the mainnet.
According to the firm’s official statement, published on June 9, the decision responds to the impossibility of achieving a fit between product and market. This, in a context where Bitcoin continues to be perceived mainly as a store of value and not as programmable money.
Spiderchain was described by Botanix as Bitcoin’s first layer 2 with a decentralized finance (DeFi) ecosystem complete and compatible with the Ethereum Virtual Machine (EVM), which would allow any application originally developed for Ethereum to run on Bitcoin, as CriptoNoticias reported at the time.
During its time of operation, the network recorded 25 million transactions, 200,000 active wallets and zero security incidents, according to the data provided by the firm itself.
Botanix also achieved integrations with protocols like Aavein addition to GMX, Morpho, Chainlink, Fireblocks, Alchemy, Galaxy and OKX Wallet. The team identifies five structural reasons for the closure:
- The timing of the market.
- The deterioration of the token launch model.
- User preference for WBTC (Wrapped Bitcoin) on Ethereum vs. native Bitcoin solutions.
- The consolidation of the ecosystem around platforms with control of the relationship with the user.
- The insufficiency of commission income to cover infrastructure costs.
The dilemma of native DeFi in Bitcoin
On market timing, Botanix suggests that the public conversation about Bitcoin remains focused on its role as a reserve asset and in its monetary and political positioning, not in its programmability.
The firm points out that these questions are prior to what a Bitcoin layer 2 needs the market to be asking, and recognizes that it is not possible to predict when—or if—that change will occur. The team also admits that Bitcoin could simply consolidate as a store of value, with there never being a market for what they built.
Regarding the token model, Botanix maintains that it always intended to launch onebut he conceived it as a genuine form of participation in the project—closer to a public offer than an airdrop—and conditional on having first achieved product-market fit. That moment never came.
The company further notes that, over the last year, token launches in the general market have performed below expectations, without producing the results that the model assumes.
Regarding the demand for DeFi in Bitcoin, the team proposes that for the majority of current use cases—lending, yield, leveraged exposure— WBTC over a general purpose layer 2 on Ethereum is enough.
Botanix maintains that users have voted with their behavior: the trust assumptions of an Ethereum-wrapped representation are acceptable to almost everyone who wants Bitcoin-denominated DeFi. Decentralization, the firm points out, matters in discourse, but in practice users choose the cheapest and most accessible option.
Regarding the consolidation of the ecosystem, Botanix warns that the on-chain economy is increasingly concentrated on platforms that control the relationship with the user: centralized exchanges, Hyperliquid and traditional finance participants that absorb a growing portion of attention and flows.
The company maintains that, as retail share shrinksthat concentration deepens, and any team that builds grassroots infrastructure operates against that current.
Bitcoin L2s face a challenge
On this last point, Botanix posits that the user base it attracted used Bitcoin primarily as a store of value to generate returns.a legitimate use case but with low transactional volume.
He adds that BINK, his neobank application with self-custody and email login, was the strategic response to that problem. But it hit app stores just weeks before the shutdown, with no time to validate its impact.
This vision is shared by other actors in the ecosystem. Alex Svanevik, CEO of Nansen, recently noted that “many Bitcoin L2s are facing the same problem: users prefer to hold their BTC in wrappers like WBTC or use more mature EVM solutions on Ethereum and their L2s, rather than experimenting with new, less liquid architectures.”
The closure is effective from July 9, 2026. According to the statement, after that date the federation will sweep the remaining BTC on the network and any assets not withdrawn will be unrecoverable. The future of L2s in Bitcoin will depend on their ability to offer something that holders cannot easily find outside of the mainnet.