Botanix to close Bitcoin Layer 2; withdrawals due July 9

Botanix Labs is winding down its Bitcoin Layer 2 network after nearly four years of development. The project said the Spiderchain mainnet will be closed and users must withdraw funds by July 9; any assets left after that date will be swept by the network federation.

The team reported that Spiderchain ran with 100% uptime and recorded no security incidents during about a year of mainnet operation. Botanix reported roughly 25 million transactions across about 200,000 wallets and said the network moved tens of millions of dollars in assets. The project completed integrations with Chainlink, Morpho and OKX Wallet.

Botanix built the stack without a native inflationary token and developed Dynafed, a dynamic federation that converts a static multisig into a rotating, decentralized operator set. The project said fee revenue did not cover baseline infrastructure costs because most users held assets long term rather than making frequent on-chain transactions.

In a post on X, the team wrote: “The honest answer we have arrived at, after living inside it every day, is that it did not work, at least not in this market and not on this timeline.”

The team listed five findings to explain the outcome. Most users continue to treat Bitcoin primarily as a reserve asset, rather than a medium for frequent on-chain activity. Token launches tied to Bitcoin-denominated applications have underperformed. Demand for Bitcoin-denominated decentralized finance has largely migrated to wrapped Bitcoin on Ethereum-based networks. Activity is concentrating on centralized platforms such as exchanges, Robinhood and Hyperliquid, where convenience and institutional access draw users away from decentralized alternatives. Finally, operating a non-inflationary Bitcoin Layer 2 proved financially challenging without sustained fee-bearing transactions.

Botanix did not provide a migration path beyond the withdrawal deadline. The team framed the shutdown as a response to user behavior and market conditions rather than technical or security failures.