Four years ago, the Blackpaper laid out a roadmap in four stages—EVM compatibility, DeFi primitives, BTC-backed stablecoins, and finally: rollups. We’ve delivered on the first three. This SIP is about delivering the fourth.
With BitcoinOS achieving the first ZK proof verification on Bitcoin mainnet last year, we now have the technology to complete what we started. This proposal establishes the Sovryn Layer as the canonical home for Sovryn—a true Bitcoin-native rollup secured by Bitcoin PoW.
What This SIP Does Creates Canonical SOV (cSOV) on the Sovryn Layer. If you’re staked, your rSOV is duplicated 1:1 as cSOV—no action required. Your staked rSOV remains locked in Rootstock Bitocracy permanently (effectively removed from circulation), while you receive fresh cSOV on the new layer. Liquid rSOV holders can convert via a one-way burn-and-mint bridge.
Distributes 100% of the BOS allocation to stakers. The full 10% BOS allocation goes directly to cSOV stakers. Not treasury. Not Exchequer. Stakers. Distribution begins around October 2026, linear over 3 years.
Unifies governance under a single Bitocracy. No more fragmented governance across chains. One token, one governance system, one canonical source of truth. BOB shifts to bridged governance via Exchequer immediately; Rootstock follows in a future SIP.
Introduces buy-and-burn for SOV. Protocol fees purchase and burn cSOV rather than distributing complex staking rewards. This ties protocol success directly to token value—proven by BNB, MKR, and others.
Why This Matters
This is more than a regular a migration. It’s the completion of Sovryn’s original vision. It is a comprehensive roadmap for the most significant move Sovryn has ever taken.
We’ve spent years building on borrowed infrastructure—EVM chains, trusted bridges, inherited limitations. The Sovryn Layer changes that. Native execution on a Bitcoin rollup. Trustless bridges via Grail. Full interoperability with other BitcoinOS rollups. L1 security for L2 applications.
For stakers who held through thick and thin: this is the payoff. SOV with cleaner value accrual. BOS distribution for your commitment. A protocol that finally lives where it was always meant to live—on Bitcoin.
The SIP
The full specification covers implementation phases, treasury consolidation, risk parameters, and security considerations. Read the complete SIP above and share your thoughts.
I’m excited about this SIP - it finally delivers the full Bitcoin-native vision for Sovryn, with the Sovryn Layer, unified governance, and the BOS distribution exclusively to stakers.
I’ve read the full proposal, and the BOS vesting is a great incentive for the next 3+ years. But long-term, relying only on token appreciation from burns might not be enough, especially since this seems to replace any direct fee distributions to stakers.
Burns benefit all holders equally - non-stakers free-ride on the deflation without locking capital or participating in governance. This could drive staking ratios lower over time, making Bitocracy less decentralized and increasing the percentage of circulating supply. What I have in mind that locking SOV in the staking contract already removes tokens from circulation, which is another direct benefit for the protocol and token value.
To keep participation high, I’d suggest a hybrid: Use 100% fees to buy cSOV, burn 70-80% for strong scarcity, and distribute 20-30% proportionally to stakers (weighted by lock duration) as exclusive yield - no inflation, but a clear economic advantage for committed holders.
I am also of the opinion that at least 20-30% fees to be paid to stakers as dividends. not this pure buyback model.
Stocks like ASML are like this, with a mix of buybacks and dividends payouts. it’s a good formula.
Plus sovryn stakers could have some kind of liquid staking that allows them to get liquidity without liquidate their’s staking positions.
I don’t think that Liquid Staking in terms of SOV - a governance token after all - makes a lot of sense. It would result in one entity getting significant stake and voting power = centralization.
after the BOS rewards are finish, it will be the same thing by what is proposed here, only half a dozen stakers will remain plus exchequer…
instead of searching for ways to eliminate “time-value discount” problem, that will compromise sovryn bitocracy in the long term, why not talk about new products with new revenue streams that will make economically efficient to stake SOV. unless…
Everything sounds good, but I have concerns like Hyde about the buybacks. I’m not sure the incentive to stake rather than just hold?
I’m not sure the use of fees like this are necessary. Sov is extremely cheap at the moment and there’s a lot of people who have finally sold and capitulated after a short run up in price a few months ago. Fast moves up activate psychology and bring in sellers. So we have what appears to be a resulting dramatic sell off. I’m positive the buyer back in October intended for this reaction. Sov at these prices won’t last long.
There is already every incentive in the world for stakers to use their fees to repurchase sov. Some are. The number 1 staker has increased their share from 5% up to 22% since June. Others have also followed increasing their share. I would just give buyers a bit more time to let the sellers finish.
Another point is I have no desire to sell ZUSD for repurchasing sov. With the more thought I’ve given to Zero it’s occurred to me that selling ZUSD puts ZUSD back into the redemption path, and as a staker I see that as countering my interests. Using protocol fees to repurchase sov would likely lead to increased zero redemptions (something I think stakers should try to avoid).
I’m sorry about the confusions on the call. I think the confusion comes from “buy-and-burn” implies removing sov from the market and reducing the supply, but if your intention is to issue new sov to reward stakers you’re simply growing the supply and reintroducing circular selling pressure.
I’m concerned a lot of this is reactionary to low sov prices and not it’s not necessary for the success of sov. If sovryn continues to improve the user utility of the dapps like zero and trading and properly communicate development progress to the community, sov prices will take care of themselves. You don’t need to force staker’s hands to repurchase sov. That will happen naturally once the sov holders who want out are gone and you’re left with those who are here for the long term. Try to remember 2021 left a significant impact on people’s psychology. Ethereum or Solana for example have still not even grown past their 2021 all time highs. I don’t think sov, that was selling as high as $68 in 2021 (while the ico price was around 20 cents) should be exempt from a post 2021 bear market to the absolute lowest price it can achieve. We’re finally seeing a wash out of those final original ico buyers who are throwing in the towel.
My report at the beginning of December shows 10 of the top 100 stakers by weight all increased their sov staking amounts through staking deposits over the month of November with no one in the top 100 decreasing their staking position. The incentive for buy backs is already there and buy backs are happening and have been since the July sell off created the incentive. The major holder who predominately cause the July sell off via deposits to Gate completed their final sells during this most recent sell off btw ( Rootstock address details for 0x7C1437Dc4C67753ecA6aF02f8E51A6d5889d2250 | Blockscout ) you can follow their sov back to their original accounts and see they are now out of all SOV. The beauty of the fixed sov supply is that these sellers who were original ico buyers in 2021 will and most likely are running out of sov. Messing with this would be like Bitcoin messing with it’s fixed supply, it would break investor confidence.
I’m all for everything about this SIP and thank you for all your efforts drafting this, but I can’t support it with the current SOV buy-and-burn/minting new sov as rewards section. Hopefully you or others can work up some solutions to my concerns regarding this section.
Much needed. This is indeed what we all signed up for 5 years ago. Though staking rewards under this model will be abysmal, and juicy BTC rewards was the Sovryn standard.
I agree with this, a small % of revenue (above 50% is too much) could be used for buy back and burn… still I think revenue should not be taken away from stakers. especially when the idea is to introduce inflation on SOV, I mean if the SOV burned is the same as the SOV inflated, the price wont go nowhere and stakers lost their revenue. the only ones winning here would be the exchequer that would get the revenue redirected to them. speaking of which, why does the exchequer needs revenue for? I haven seen the last financial reports as they haven’t been publish, and the old ones don’t describe where the expenses were spent on… so no new products were built or will be build, there is no markting, there is no nothing. sovryn was building BitcoinOS then Charms then both end up being spinned off at stakers expense. the operation costs from exchequer are opaque and now stakers also gonna lose their revenue?
POWA and Rune bridge, deployment of new DEX on BOB, Orignins, constant improvement and fixes of DEX on RSK - really no new things?
Sovryn was only one of the cogs in this machinery. One of many. There are things that Sovryn can help with, but not easily build them. These are very complicated things, that requrire certain skillset, knowledge and experience.
Not to be “That guy” but, I’m almost certain everyone is on board with this. While I see the benefit of the slowfi thing. Sovryn layer has a real chance to be the first roll-up on Bitcoin.
Maybe just this once we can move fast and break shit?this could be a really big deal in the Bitcoin Space. Maybe Sovryn finally gets the spotlight it deserves.
I liked what Yago said on the call but I don’t like the idea of minting more SOV at all.
one question I have though is what happens to all of the ESOV? Will there be a way for those who are on BOB or ethereum holding their eSOV token to lock in their tokens for the cSOV?
It wouldn’t make much sense for eSOV holders to have to sell their ESOV → BTC; BTC → rBTC; rBTC → eSOV; eSOV → cSOV
The most epic solution from a UX perspective would be: CSov can be exchanged for any form of Sov on the Sov layer… otherwise, what would be the purpose of calling it canonical?
How specific do parameters need to be for the buy/burn mechanics? Can we just implement a basic mechanism and tweak it later? There’s a lot of parts to it that aren’t discussed here that’s why I’m asking.
Do we set a % of returns to stakers but it’s much lower than the current APY but now it’s set and all additional rewards go to buy and burn?
or do we send all rewards to buy and burn and stakers get no ROI other than SOV price go up from buy and burn?
Can we change APY in the future?
Can we change what rewards are given out in future?
I say just set a basic buy and burn mechanism and then we tweak it if need be, but like you said bnb and other protocols have already shown success.
If we capped staker revenue at a stable % of 8-10% and the rest of rewards go to buy/burn mechanics. Making staking more appealing by streamlining a stable apy% to all stakers since they’re taking much less than what the protocol would have been paying them without having to endure the random spikes in earnings.
I don’t think that particular thing is a pai don’t think the minting new SOv is a part of the scope of this.
Minting more tokens is probably a super dumb idea just because it dilutes Stakers. Punished for staking.
I almost certainly bet that particular idea end up “just and idea”.
It has some benefits, but it makes any “tokenomics can’t be changed” statements from team in the past, ridiculously comical. Particularly during the damn “lock coins up” debacle.
I do think you will be able to trade all SOV into “cSOV” in the end if I understood correctly. Canonical (Sovryn layer) is one chain to rule them all.
Section 2.2.3 says stakers can unstake cSOV without long lockups or penalties.
Can you clarify: does this mean immediate unstaking is possible, or will there be a shorter lockup period? And does the voting power multiplier system carry over to cSOV staking?