Hemi (HEMI) — A modular Layer 2 solution connecting Bitcoin and Ethereum

Core Highlights

Hemi is a modular Layer 2 blockchain solution designed to integrate the security of Bitcoin with the programmability of Ethereum on a unified platform. Through the Proof of Proof (PoP) consensus mechanism and a virtual machine with a built-in Bitcoin node, the protocol allows smart contracts to directly access Bitcoin data. The HEMI token is the native asset within the ecosystem, supporting governance, staking, Gas fees, and reward mechanisms. Cross-chain tunnel technology replaces traditional bridging solutions to achieve seamless asset flow between Bitcoin, Ethereum, and Hemi.

What is Hemi

Hemi, as a modular Layer 2 solution, breaks down the barriers between the Bitcoin and Ethereum ecosystems. The protocol combines the robust security guarantees of Bitcoin with the flexibility of the Ethereum smart contract ecosystem, creating a unified interoperable platform.

The core innovation lies in its virtual machine architecture. The Hemi Virtual Machine (hVM) is an improved version based on EVM, with the key feature of embedding a complete Bitcoin node. This means that smart contracts running on hVM can natively access Bitcoin transaction information, account balances, and UTXO data without relying on external oracles.

In terms of security, Hemi adopts the Proof of Proof (PoP) consensus mechanism, periodically anchoring the network state to the Bitcoin blockchain. This design allows Hemi to inherit the security properties of Bitcoin while reducing the risks of chain reorganization and consensus disputes. With this architecture, developers can build truly decentralized applications (DApps) that can interact with Bitcoin, while maintaining full compatibility with the Ethereum toolchain.

Technical Architecture Explanation

How Proof of Proof consensus works

Hemi's PoP mechanism is an innovative consensus design that enhances the security of the entire system by writing the network validation status to the Bitcoin blockchain.

During this process, Hemi maintains a dedicated set of PoP miner nodes. These miners regularly collect the block header data from the Hemi network, generate cryptographic proofs, and then submit these proofs to the Bitcoin network. In exchange, the miners receive HEMI token rewards.

Due to the block generation speed and fee fluctuations of Bitcoin, Hemi has introduced a delay mechanism of 9 Bitcoin blocks (approximately 90 minutes) as a final confirmation window. This ensures that state updates do not occur too frequently while providing sufficient security. By closely binding consensus with Bitcoin, Hemi significantly reduces the likelihood of being attacked or undergoing a reorganization.

The uniqueness of the Hemi Virtual Machine (hVM)

hVM is essentially an enhanced execution environment that integrates Bitcoin data access capabilities on the basis of EVM compatibility.

The system has a lightweight Bitcoin daemon (Tiny Bitcoin Daemon, abbreviated as TBC) built in. This daemon process is designed for low resource consumption, continuously synchronizing with the Bitcoin network to pull the latest block data and maintain consistency across all Hemi nodes. Whenever Hemi generates a new block, the network synchronizes the latest snapshot of Bitcoin information, ensuring that all nodes have a synchronized understanding of the Bitcoin status.

Smart contract developers can query details of Bitcoin transactions, account balances, UTXO sets, and other information through pre-compiled contract interfaces (built-in shortcuts). This eliminates the need for third-party oracles and greatly simplifies the development process of cross-chain applications.

Cross-chain Tunnel Mechanism

Hemi has adopted a cross-chain bridging system called “Tunnel”, which does not require traditional relay node verification. The Tunnel directly monitors the state changes of multiple blockchains at the protocol level, achieving atomic asset transfers.

When assets are recharged, the user's assets are locked on the source chain, and an equivalent amount of token certificates is minted on Hemi, which can be circulated immediately within the ecosystem. When assets are withdrawn, the tokens on Hemi are destroyed, and the original assets on the source chain are subsequently unlocked. As of September 2025, the tunnel has supported ERC-20 and BRC-20 standard tokens, with plans to expand to more Bitcoin-native assets in the future, further deepening the integration of DeFi and the Bitcoin economy.

Hemi Bitcoin Kit (hBK) development tool library

hBK is a smart contract library designed specifically for Hemi developers, providing a convenient Bitcoin data query interface.

As the daemon process has completed the local synchronization of Bitcoin data at the hVM level, developers do not need to set up complex infrastructure or rely on external services to directly access Bitcoin information. This significantly accelerates the application iteration cycle, and space has been reserved in the library for more advanced tool integration.

HEMI Token Economics

Currency: Hemi (HEMI)

• Max Supply: 10,000,000,000

HEMI is the native token of the Hemi protocol, and the key functions throughout the ecosystem include:

• Governance Rights: HEMI holders can vote on protocol upgrades, parameter adjustments, and ecological development plans, directly influencing the evolution of the network.

• Security Assurance: By staking HEMI, validators participate in the PoP consensus maintenance and receive incentives for submitting the state to Bitcoin, which is an important guarantee for network security.

• Transaction Fees: Deploying and executing smart contracts on hVM, interacting with Bitcoin states, and making cross-chain transfers through tunnels all require paying Gas fees with HEMI.

• Staking Rewards: Users can stake HEMI to obtain veHEMI, sharing in the various revenues generated by the network, including block rewards and transaction fee distributions.

Project Background and Founders

Hemi was co-founded by Jeff Garzik and Max Sanchez. Garzik is an early contributor to Bitcoin Core development, while Sanchez has extensive experience in blockchain security and the Coinbase engineering team. Together, they established Hemi Labs with the goal of bridging the Bitcoin scripting capabilities with the Ethereum smart contract ecosystem.

Overall Evaluation

Hemi represents a new approach to multi-chain interoperability. By directly embedding Bitcoin nodes into the execution environment, combined with the Proof of Proof security mechanism and trustless cross-chain tunnels, this protocol provides developers with a complete toolkit that can leverage both the security of Bitcoin and the flexibility of Ethereum. Whether it’s DeFi applications, cross-chain liquidity protocols, or other Web3 services that require trustless cross-ecosystem interactions, Hemi offers viable infrastructure support.