Bitcoin L2 Interoperability: Cross-Layer Transfer Methods
Compare interoperability between Bitcoin Layer 2 networks: atomic swaps, bridges, submarine swaps, and shared liquidity across Lightning, Spark, Liquid, and more.
Cross-Layer Transfer Methods Compared
Bitcoin's Layer 2 ecosystem has grown into a collection of independent networks: Lightning, Spark, Liquid, Stacks, Rootstock, Citrea, Ark, and others. Each L2 optimizes for different tradeoffs in speed, trust, and functionality. The challenge is moving BTC between them. Unlike Ethereum's L2s, which share a common settlement layer with native messaging, Bitcoin L2s rely on cryptographic swap protocols, federated pegs, and protocol-level integrations to achieve interoperability.
The following table summarizes the primary transfer methods used across Bitcoin L2s, their trust models, and practical characteristics. For a broader comparison of the L2s themselves, see the Layer 2 comparison tool.
| Method | Trust Model | Speed | Typical Fee | Supported Paths |
|---|---|---|---|---|
| Submarine swap | Trustless (HTLC) | Near-instant to 30 min | 0.05%–0.5% | Lightning ↔ on-chain, Lightning ↔ Liquid |
| Atomic swap | Trustless (HTLC) | Varies by chain | Network fees only | Any HTLC-compatible pair |
| Federated peg | Federated multisig | 11 min to 17 hours | 0%–0.1% + network fees | L1 ↔ Liquid, L1 ↔ Rootstock |
| Threshold signature bridge | Honest majority (signers) | 10–60 min | Network fees | L1 ↔ Stacks (sBTC) |
| BitVM bridge | 1-of-N honesty | 60 min in, ~1.5 days out | Network fees | L1 ↔ Citrea |
| Protocol-level integration | Operator set (1-of-N) | Near-instant | Minimal | Spark ↔ Lightning |
| ASP gateway | ASP trust (temporary) | Near-instant | ASP-set | Ark ↔ Lightning, Ark ↔ L1 |
Submarine Swaps
Submarine swaps use Hash Time-Locked Contracts to atomically exchange on-chain BTC for off-chain Lightning BTC, or vice versa. The HTLC ensures that either both sides of the swap complete or both are refunded: no counterparty can steal funds.
Lightning Loop, operated by Lightning Labs, remains the most widely used submarine swap service. Loop Out (Lightning to on-chain) and Loop In (on-chain to Lightning) charge dynamic fees starting around 0.05% plus miner fees. Loop introduced MuSig2 signatures in early 2025 to reduce on-chain costs through transaction batching.
Boltz Exchange previously offered submarine swaps across Bitcoin, Lightning, Liquid, and Rootstock at fees between 0.1% and 0.5%. However, Boltz suspended operations in August 2026 following infrastructure attacks, leaving wallets like Aqua, Bull Bitcoin, and Zeus without swap access. Blockstream launched Blockstream Swaps in beta shortly after as a replacement, offering HTLC-based swaps across Bitcoin, Lightning, and Liquid.
Atomic Swaps
Atomic swaps generalize the HTLC mechanism to any pair of chains that support hash locks and timelocks. Both parties lock funds with matching hash locks, and revealing the preimage on one chain allows claiming on the other. Lightning itself uses HTLCs for every routed payment, making each multi-hop payment technically an atomic swap.
PeerSwap enables Lightning node operators to rebalance channels using atomic swaps between BTC and L-BTC (Liquid Bitcoin), executing directly between peers without a centralized service. For cross-L2 transfers between networks that both support HTLCs, atomic swaps remain the most trust-minimized option available.
Federated Bridges
Federated bridges rely on a group of known entities (functionaries or signers) controlling a multisig that custodies locked BTC. The security depends on the assumption that a supermajority of signers will not collude.
Liquid Network
The Liquid Network uses an 11-of-15 federated multisig operated by functionaries running hardware security modules. The broader Liquid federation includes 87 members across six continents, though only 15 serve as functionaries controlling the peg. Peg-in requires 102 Bitcoin block confirmations (roughly 17 hours). Peg-out settles in 11 to 35 minutes after two Liquid confirmations plus batch processing by the federation.
Rootstock PowPeg
Rootstock's PowPeg is a 5-of-9 federated multisig with an additional hardware enforcement layer: Ledger HSMs refuse to sign withdrawal transactions unless they come from Rootstock's consensus chain with sufficient proof-of-work confirmations. Rootstock benefits from merge mining with roughly 87% of Bitcoin's hashrate. Native peg-in takes 100 Bitcoin blocks (about 16 hours), and native peg-out takes roughly 33 hours. The Flyover protocol provides fast peg-out in about 20 minutes at a 0.15% fee by using liquidity providers who front the BTC.
sBTC on Stacks
Stacks uses a threshold signature scheme with 15 professional signers (including Blockdaemon and Kiln) who manage a BTC multisig. A 70% consensus threshold (approximately 11 of 15) is required for transaction approval. Since the Nakamoto upgrade activated at Bitcoin block 840,360, Stacks transactions have Bitcoin-equivalent finality: reversing a Stacks transaction requires reversing the corresponding Bitcoin block. sBTC deposits settle in one to three Bitcoin blocks, and withdrawals require six Bitcoin block confirmations.
BitVM Bridges
BitVM-based bridges represent the most trust-minimized bridge design currently in production. Citrea's Clementine bridge, launched with mainnet in January 2026, is the first production BitVM2 bridge. It operates on a 1-of-N honesty assumption: one honest Signer ensures funds follow pre-approved paths, one honest Watchtower can block invalid claims, and one rational Challenger can prove invalid computation and seize a malicious Operator's collateral (a roughly 2 BTC bond).
Deposits require six or more Bitcoin block confirmations and must be in exact multiples of 10 BTC. Withdrawals include a dispute window of approximately 1.5 days. While more trust-minimized than federated designs, the current constraints on deposit sizes and withdrawal delays limit practical use to larger transfers.
Protocol-Level Integration: Spark and Lightning
Spark takes a different approach by building Lightning interoperability directly into the protocol. Spark users can send to any Lightning invoice and receive Lightning payments without managing channels, inbound liquidity, or routing. The Spark Service Provider (SSP) handles Lightning routing while the Spark Engine locks and finalizes transfers atomically using conditional transfers.
This design eliminates the need for third-party swap services entirely. Where Lightning-to-Liquid transfers require Blockstream Swaps or PeerSwap, and Lightning-to-Stacks has no direct path at all, Spark treats Lightning as a native payment rail. Transfers are near-instant with minimal fees since they avoid on-chain transactions. Spark also supports Taproot Assets and stablecoins like USDB, enabling multi-asset transfers across the same interoperability layer.
Ark Protocol
Ark uses an Ark Service Provider (ASP) that organizes rounds, typically every 15 to 60 minutes, in which users hold Virtual UTXOs (VTXOs): off-chain, pre-signed transaction trees that can be broadcast at any time for unilateral on-chain exit. The ASP acts as a Lightning gateway, allowing Ark users to pay any Lightning invoice from their balance and receive incoming Lightning payments as new VTXOs.
For direct Ark-to-Ark payments, the receiver temporarily trusts that the sender and ASP do not collude to double-spend, but this risk is eliminated when the VTXO is refreshed in the next round. VTXOs have a configurable lifetime of roughly 30 days, after which they must be refreshed. In 2026, Lightning Labs launched Wavelength, an alpha toolkit described as an Ark-like settlement layer for agentic payments.
L2-to-L2 Compatibility Matrix
Direct L2-to-L2 transfers remain rare. Most cross-L2 paths require routing through Bitcoin L1 or Lightning as an intermediary. The following matrix shows which direct transfer paths exist between major Bitcoin L2s.
| From / To | Lightning | Spark | Liquid | Stacks | Rootstock | Citrea | Ark |
|---|---|---|---|---|---|---|---|
| Lightning | — | Native | Swap service | None | None | None | ASP gateway |
| Spark | Native | — | Via Lightning | None | None | None | Via Lightning |
| Liquid | Swap service | Via Lightning | — | None | None | None | None |
| Stacks | None | None | None | — | None | None | None |
| Rootstock | None | None | None | None | — | None | None |
| Citrea | None | None | None | None | None | — | None |
| Ark | ASP gateway | Via Lightning | None | None | None | None | — |
The pattern is clear: Lightning serves as the primary interoperability hub for Bitcoin L2s. Spark and Ark connect to Lightning natively. Liquid connects via swap services. Sidechains and rollups (Stacks, Rootstock, Citrea) are isolated from each other, requiring a two-hop path through L1 for cross-L2 transfers. For deeper analysis of each L2's architecture, see our Bitcoin Layer 2 comparison research.
Fee and Speed Comparison
| Transfer Path | Fee | Speed | Trust Required |
|---|---|---|---|
| Spark ↔ Lightning | Minimal (no on-chain tx) | Near-instant | Operator set (1-of-N) |
| Lightning Loop Out | ~0.05% + miner fees | 10–30 min | Trustless (HTLC) |
| Lightning ↔ Liquid (swap) | 0.1%–0.25% | 2–5 min | Trustless (HTLC) |
| Liquid peg-in | Network fees | ~17 hours (102 blocks) | Federated (11-of-15) |
| Liquid peg-out | Network fees | 11–35 min | Federated (11-of-15) |
| Rootstock peg-in | Network fees | ~16 hours (100 blocks) | Federated (5-of-9 + HSM) |
| Rootstock Flyover (fast out) | 0.15% + network fees | ~20 min | Liquidity provider |
| sBTC deposit (Stacks) | Network fees | 10–30 min (1–3 blocks) | Threshold (11-of-15) |
| sBTC withdrawal (Stacks) | Network fees | ~60 min (6 blocks) | Threshold (11-of-15) |
| Citrea Clementine deposit | Network fees | ~60 min (6+ blocks) | 1-of-N (BitVM2) |
| Citrea Clementine withdrawal | Network fees | ~1.5 days (dispute window) | 1-of-N (BitVM2) |
| Ark ↔ Lightning | ASP-set | Near-instant | ASP (temporary) |
Unified Bitcoin L2 Liquidity
The current state of Bitcoin L2 interoperability resembles Ethereum in 2021: liquidity is fragmented across isolated networks, and cross-L2 transfers are expensive and slow. Several developments point toward a more unified future.
Lightning's role as the interoperability hub is strengthening. Spark's native Lightning integration, Ark's ASP gateway model, and Liquid's swap services all route through Lightning as the common layer. As more L2s build Lightning gateways, the network effect compounds: a user on any Lightning-connected L2 can reach any other Lightning-connected L2 without touching L1.
Covenant proposals like OP_CAT and CTV could enable new bridge designs with stronger trust guarantees directly in Bitcoin Script. BitVM bridges, while currently limited in throughput, prove that 1-of-N trust models are achievable on Bitcoin without consensus changes. The progression from federated pegs (11-of-15) to threshold signatures (11-of-15 with collateral) to BitVM (1-of-N) shows a clear trend toward reducing trust assumptions over time.
Frequently Asked Questions
Can I transfer BTC directly between Bitcoin Layer 2 networks?
Direct L2-to-L2 transfers are only possible for a few pairs. Spark and Ark connect to Lightning natively, and Liquid connects to Lightning via swap services. For most other pairs (Stacks to Rootstock, Citrea to Liquid, etc.), you must withdraw to Bitcoin L1 first and then deposit into the target L2, which can take hours and incur fees on both legs.
What is the cheapest way to move BTC between Layer 2s?
The cheapest path depends on which L2s are involved. For Lightning-connected networks (Spark, Ark, Liquid), transfers can cost under 0.1% in fees. For sidechains and rollups that only bridge to L1, you pay miner fees on both the withdrawal and deposit transactions. The Spark-to-Lightning path has the lowest overhead since it avoids on-chain transactions entirely.
What is the difference between a submarine swap and an atomic swap?
A submarine swap is a specific type of atomic swap between an on-chain UTXO and an off-chain Lightning payment. Both use HTLCs for trustless execution. The term "atomic swap" is broader and covers any HTLC-based exchange between two chains or layers, while "submarine swap" specifically refers to the on-chain/off-chain boundary crossing.
Are Bitcoin L2 bridges safe?
Safety depends on the bridge design. Federated pegs (Liquid, Rootstock) distribute trust across known entities but require honest supermajorities. Threshold signature bridges (sBTC) add collateral requirements. BitVM bridges (Citrea) offer the strongest guarantee: only one honest participant is needed to prevent theft. HTLC-based swaps are fully trustless. The collapse of Boltz Exchange in August 2026 highlights that even trustless swap protocols depend on the operational reliability of service providers.
Why does Lightning act as the interoperability hub for Bitcoin L2s?
Lightning is the most widely deployed Bitcoin L2 with the broadest wallet and service support. Its HTLC-based payment channels are compatible with submarine swaps and atomic swaps, making it the natural intermediary. Newer protocols like Spark and Ark build Lightning interoperability directly into their architecture, recognizing that connectivity to Lightning's existing network provides immediate access to millions of users and thousands of merchants.
How does Spark interoperate with Lightning without a bridge?
Spark integrates Lightning at the protocol level rather than relying on external swap services. The Spark Service Provider routes Lightning payments while the Spark Engine handles conditional asset locking and atomic settlement. Users can pay any Lightning invoice directly from their Spark balance. This avoids the liquidity fragmentation, channel management, and third-party dependencies that characterize other L2-to-Lightning integrations.
What happens if a Bitcoin L2 bridge operator goes offline?
The impact depends on the bridge type. Federated pegs continue operating as long as the threshold is met (e.g., 11 of 15 for Liquid). BitVM bridges allow users to reclaim funds through a refund path after a timelock expires (200 Bitcoin blocks for Citrea). Ark users can broadcast their pre-signed VTXO transaction trees for unilateral on-chain exit at any time. The key principle across all designs is that users should always retain a unilateral exit path to Bitcoin L1.
This tool is for informational purposes only and does not constitute financial advice. Data is approximate and based on publicly available information as of September 2026. Protocol specifications, fees, and service availability change frequently. Always verify current data before making decisions.
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