Documentation

The Problem

‍Bitcoin is the largest digital asset by a wide margin, but it remains largely isolated from the EVM ecosystem where most onchain financial activity takes place. The root cause is architectural. Bitcoin uses a UTXO model, Ethereum and its L2s use an account model, and the two don't communicate natively. Bridging between them has historically required either trusting a centralized custodian or accepting the security model of a bridge that most serious holders aren't comfortable with.

‍What Annular Is

‍Annular is a cross-chain protocol that connects UTXO chains (Bitcoin, Zcash, Litecoin) to EVM chains (Ethereum, Arbitrum, Optimism, Base, Polygon). It uses native multisignature custody on the UTXO side and smart contract-based asset pools on the EVM side. A distributed validator network coordinates between the two, and the entire system is anchored by a unified state tree called Omnimerkle that anyone can independently verify against actual on-chain data. The protocol is programmatic, with an API as the primary interaction model, and is live today on private testnet.

‍How It Works

‍On the UTXO side, assets sit in native multisignature addresses controlled by the validator set. On the EVM side, assets are held in smart contracts called Custom Asset Pools (CAPs). A user initiates a bridge request, receives a fresh multisig deposit address on the source UTXO chain, and sends funds. Validators detect the deposit, update the Omnimerkle state, and post root attestations to the destination EVM chain. The user then submits a Merkle proof to claim their funds on the other side. No single entity takes custody at any point in the flow.


‍Omnimerkle

‍Omnimerkle is the piece that holds the system together. It is a Merkle tree that aggregates verified on-chain state from every supported network. Because the underlying data is publicly observable on each chain, anyone running nodes can confirm that the attested state matches reality. This is a meaningful distinction from systems where users have to take an operator's word for what happened on another chain. Omnimerkle serves as a canonical, cross-chain ledger that is independently auditable at all times.

Validator Architecture

‍Validators each hold and sign with their own keys rather than using MPC key shares, which means every validator's participation in a signing operation is individually verifiable on-chain. Fresh deposit addresses are generated per request, so when the validator set changes, new deposits go to addresses controlled by the updated set and old addresses drain naturally. This eliminates the need for key migration, a common pain point and security risk in other cross-chain designs.

‍Institutional Treasury Management

‍Organizations holding diversified portfolios across Bitcoin and EVM assets can consolidate operations under a single protocol. Rather than running separate custody arrangements and security processes for each chain type, the full portfolio can be managed through consistent interfaces. Policy controls such as multi-party approvals, spending limits, timelocks, and role-based permissions can be applied through abstract account contracts represented within Omnimerkle and as CAP beneficiary addresses, covering both UTXO and EVM assets.

‍DAO and Protocol Treasuries

‍Blockchain projects and foundations holding assets across multiple chains face particular challenges around custody, reporting, and accounting. Omnimerkle provides a canonical ledger across all supported networks, and the non-custodial model reduces counterparty exposure compared to centralized alternatives. Protocol treasuries can be managed with consistent governance across chain types, reducing operational complexity.

‍Cross-Chain Access

‍Holders of Bitcoin, Zcash, or Litecoin can reach EVM-based protocols without trusting a centralized bridge operator. The verifiable Omnimerkle state and non-custodial design provide stronger guarantees than typical bridge architectures. Cross-chain operations are initiated through structured requests, making the protocol accessible programmatically for developers and integrators building on top of it.

‍Competitive Landscape

‍Centralized MPC platforms like Fireblocks provide unified interfaces but concentrate trust in a single operator running proprietary infrastructure that can't be independently audited. Smart contract wallets like Safe provide strong security and flexibility for EVM assets but have no way to extend to UTXO chains. Bitcoin-native multisig providers like BitGo and Unchained offer solid custody for Bitcoin specifically but don't provide unified management across chain types.

‍Where Annular SitsAnnular extends the multisignature model into cross-chain coordination while keeping everything non-custodial and verifiable. It occupies a distinct position, bridging the gap between UTXO and EVM ecosystems without introducing centralized custody or proprietary trust assumptions. The current tradeoff is that individual validator signatures on-chain cost more gas than a single aggregated MPC signature, though ZK-based signature batching is planned to address this.

‍The Interface

‍The primary interface follows the model established by Gnosis Safe, but extends it across chain types. Users can view balances, initiate transfers, and approve transactions across Bitcoin, Zcash, Litecoin, and any supported EVM chain from one place. Custom policies can be configured per account or per asset, covering controls like approval thresholds, spending limits, whitelisted destinations, and timelocks. Hooks allow teams to attach programmable logic to transaction events, triggering notifications, enforcing compliance checks, logging to external systems, or gating execution on arbitrary conditions.

‍Infrastructure Layer

‍Beyond the interface, Annular is infrastructure. The protocol exposes a programmatic API that other protocols, companies, and developers can build on top of. Any platform that needs to move assets between UTXO and EVM chains, manage cross-chain custody, or verify cross-chain state can integrate Annular directly into their own products and workflows. A DeFi protocol can embed UTXO-to-EVM bridging into its deposit flow. A custody platform can plug into Omnimerkle for unified cross-chain reporting. A treasury management tool can leverage the policy and hook system to enforce governance rules across chain types without building that coordination layer from scratch. The interface is one implementation on top of Annular's infrastructure. It is not the product boundary. The protocol is designed to sit beneath other products as a foundational layer for cross-chain interoperability.

‍Confidential Payments (future)

‍Every feature in Annular's current architecture becomes more useful when transaction amounts and balances aren't exposed on-chain. Confidential payments allow users to deposit, transfer, and withdraw across UTXO and EVM chains without revealing position sizes, movement patterns, or counterparty relationships to public observers.For institutional treasury management, this is critical. Organizations rebalancing across Bitcoin and EVM assets currently broadcast their exact positions and timing to every participant in the market. Competitors, counterparties, and adversaries can front-run movements, infer strategy, or size exposure simply by watching the chain. Confidential payments eliminate that surface. Policy controls — approval thresholds, spending limits, timelocks, role-based permissions — still execute and enforce, but the underlying amounts and destinations remain private.For DAOs and protocol treasuries, the same logic applies. Governance-approved disbursements, grant funding, and strategic asset movements don't need to be front-run or publicly dissected before execution settles.For the infrastructure layer, confidential payments make Annular a meaningfully different integration for any protocol building on top of it. A DeFi protocol embedding Annular's bridging can offer users private cross-chain deposits. A custody platform can provide institutional clients with verifiable but non-public reporting. A treasury tool can enforce governance without exposing capital structure. Privacy becomes a composable feature that propagates through every product built on the protocol.


‍Market Context

‍Bitcoin's market cap approaches $2 trillion, yet only $5-6 billion in BTC is locked into DeFi. Less than 1% of its value actively deployed in decentralized finance, compared to Ethereum's $130+ billion in DeFi TVL. Bitwise's head of research estimates the Bitcoin staking market alone represents a $200 billion addressable opportunity, and industry projections suggest Bitcoin DeFi TVL could grow as much as 300-fold as infrastructure matures.Total DeFi TVL hit a record $237 billion in Q3 2025, up 41% year-over-year. Cross-chain bridge TVL has reached $55 billion, with monthly bridging volume exceeding $23 billion and weekly volume surpassing $5.2 billion across over 1.5 million monthly transactions.

Despite this scale, cumulative bridge hack losses now exceed $2.8 billion. In H1 2025 alone, cross-chain breaches surpassed $2.3 billion, already exceeding the full-year 2024 total. Bridge transaction failure rates run between 5-15% during congestion, and users abandon bridge transactions at an estimated 70% rate during the approval process.

Fee unpredictability compounds the problem, with identical $100 transfers costing anywhere from $2.60 to $52.59 depending on protocol.The institutional crypto custody market was valued at $3.2 billion in 2024 and is projected to reach $7.74 billion by 2032 at a CAGR of roughly 13%. The broader digital asset custody market was projected at $684.8 billion in 2024 and is expected to reach $4.6 trillion by 2033.