Grayscale, a leading crypto asset management firm, identifies several noteworthy Bitcoin (CRYPTO:BTC) Layer 2 technologies, such as BitVM, Spiderchains, and Taproot Assets, indicating a resurgence in Bitcoin development.

These technologies offer new use cases for Bitcoin and may stimulate increased demand for BTC in the market, according to Grayscale analyst Michael Zhao.

BitVM, introduced by Robin Linus, introduces a new computing model enabling smart contract functionality on Bitcoin, with projects like Build on Bitcoin exploring its integration.

Spiderchains, developed by Botanix Labs, offer layer 2 chains secured by staked Bitcoin, showcasing innovative scalability solutions.

Additionally, Babylon's BTC re-staking technology expands Bitcoin's utility by enabling BTC holders to stake their coins on other blockchain networks, potentially broadening Bitcoin's role in the crypto ecosystem.