Hemi is a modular Layer 2 blockchain designed to integrate the Bitcoin and Ethereum ecosystems. The protocol aims to enhance Bitcoin's utility by introducing programmability, allowing developers to build decentralized applications (DApps) that interact directly with Bitcoin data while leveraging an Ethereum-compatible environment.

Overview

Hemi was developed to address the programmability limitations of the Bitcoin network. While Bitcoin is recognized for its security and status as a store of value, its scripting language is intentionally limited, which restricts the development of complex smart contracts and DApps directly on its base layer. Hemi seeks to bridge this gap by creating a "programmable Bitcoin chain" that combines the security of Bitcoin with the smart contract flexibility of the Ethereum Virtual Machine (EVM). The project's core vision is to treat Bitcoin and Ethereum as components of a unified "supernetwork," enabling new applications in Bitcoin Decentralized Finance (BTCFi), Web3, and AI. ^{[5] [8]}

The protocol functions as a programmability layer that allows idle Bitcoin to be used as a productive, yield-generating asset in DeFi applications such as lending and staking, without requiring users to rely on wrapped or synthetic versions of Bitcoin. This approach is intended to attract institutional capital and large Bitcoin holders by providing a secure environment to utilize their assets. The project was in development for two years prior to its public launch. The network is developed by Hemi Labs and supported by the Hemispheres Foundation. ^{[2] [3]}

Following its launch, the Hemi ecosystem saw significant growth. As of late September 2025, data on the network's total value locked (TVL) varied across different reporting platforms. Some sources indicated a DeFi TVL of approximately $279 million, which positioned Hemi as the second-largest Bitcoin sidechain by this metric. Other reports suggested the TVL across all its protocols had surpassed $840 million, with some estimates placing the total TVL as high as $1.2 billion. By this time, the ecosystem had expanded to include over 90 active protocols and more than 100,000 verified users, indicating growing adoption and utility. ^{[9] [10]}

History

Hemi was co-founded by Jeff Garzik, an early Bitcoin core developer, and Max Sanchez, a blockchain security expert. The project was conceived to merge the distinct strengths of the two largest blockchain ecosystems. Prior to its launch, Hemi Labs secured $15 million in a funding round co-led by Binance Labs and Breyer Capital. ^{[7] [8]}

Jeff Garzik has been a prominent figure in the open-source software and blockchain industries. Before his involvement with Bitcoin, he spent a decade at Red Hat, where he contributed to the Linux kernel. He was one of the early developers working on the Bitcoin Core software, and he played a role in fostering the early developer community by distributing 15,678 BTC in bounties. ^[5]

Max Sanchez is credited as a co-inventor of the Proof-of-Proof consensus mechanism, which is central to Hemi's architecture. His background includes co-founding and serving as the CTO of VeriBlock and working as an engineer at Coinbase. He has been active in the blockchain space since 2011 and is recognized for identifying and helping resolve consensus vulnerabilities in various blockchain projects, as well as developing open-source GPU miners. ^{[5] [7]}

The native token, HEMI, had its public launch at the end of August 2025. On September 23, 2025, Binance announced that Hemi would be the 43rd project featured on its HODLer Airdrops program, allocating 100 million HEMI tokens to the event. The token was subsequently listed on the exchange on the same day with a "Seed Tag," indicating it was an early-stage project. Trading pairs were opened for HEMI against USDT, USDC, BNB, FDUSD, and TRY. ^{[7] [10] [11]}

Market Performance

Initial Price Surge

Following a relatively quiet public launch at the end of August 2025, the HEMI token experienced a significant price increase in September 2025. In less than a month, the token's value surged by over 900% from its late August lows. The rally was driven by a combination of strategic exchange listings, growing interest in its DeFi ecosystem, and speculative demand. On September 23, 2025, the day of the Binance listing announcement, the token's price reached an intraday high of $0.1773. At its peak, the project achieved a fully diluted valuation (FDV) of approximately $1.7 billion. ^{[9] [10]}

Exchange Listings and Impact

The token's meteoric rise was significantly fueled by its listing on Binance, the world's largest cryptocurrency exchange, which provided access to millions of users and greatly increased its liquidity. The listing was part of Binance's HODLer Airdrop program, which distributed 100 million HEMI tokens to users staking BNB, further stimulating demand. However, the rally was not solely dependent on the Binance listing. The HEMI token had previously debuted on other exchanges, including Gate, Toobit, BYDFi, and WEEX, which helped build liquidity and accessibility across multiple markets. The increased interest culminated in a 24-hour trading volume that exceeded $500 million, a figure three times its market capitalization at the time, underscoring strong demand and active trader participation. ^{[9] [8]}

Derivatives Market and Technical Outlook

In addition to spot market listings, HEMI was also introduced to the derivatives market. On September 24, 2025, the token was listed on Hyperliquid for perpetual futures trading with up to 3x leverage, further expanding its reach among traders. Despite the strong upward momentum, technical indicators suggested the token was entering overbought territory. The 14-day Relative Strength Index (RSI) reached 86.61, while the 7-day RSI peaked at 90.49. These levels signaled extreme bullish momentum but also highlighted the potential risk of a short-term price correction as traders might look to take profits. ^[9]

Technology

Hemi's architecture is built on several core components designed to facilitate secure and seamless interoperability between the Bitcoin and Ethereum networks.

Hemi Virtual Machine (hVM)

The Hemi Virtual Machine (hVM) is the core of the network's functionality. It is a modified version of the Ethereum Virtual Machine (EVM) that is fully EVM-compatible, allowing developers to use familiar tools and programming languages like Solidity. The key innovation of the hVM is that it embeds a full Bitcoin node directly within its environment. This design is often described as a "full Bitcoin node wrapped inside an EVM." ^{[2] [5] [10]}

This integration enables smart contracts deployed on Hemi to natively and directly read Bitcoin network data, including transactions, account balances, and Unspent Transaction Outputs (UTXOs), without relying on external oracles or centralized data providers. To facilitate this, the hVM uses custom precompiled smart contracts that act as efficient, built-in functions for querying Bitcoin's state. To ensure that all nodes on the Hemi network have a consistent and up-to-date view of the Bitcoin blockchain, a lightweight process known as the Tiny Bitcoin Daemon (TBC) runs on each Hemi node. The TBC connects to the Bitcoin network, downloads blocks, and synchronizes this data across the Hemi ecosystem. ^[7]

Proof-of-Proof (PoP) Consensus

Hemi utilizes a proprietary consensus mechanism called Proof-of-Proof (PoP) to secure its network. Co-invented by Max Sanchez, PoP is designed to provide Hemi with Bitcoin-level security and finality against chain reorganizations in a decentralized and permissionless manner. The mechanism works by anchoring Hemi's network state to the Bitcoin blockchain. ^[5]

The PoP system involves two key types of participants:

• Hemi Validators: These are standard network validators responsible for producing and validating blocks on the Hemi chain.
• PoP Miners: These are specialized miners who monitor the Hemi network. They collect Hemi's block headers, generate cryptographic proofs of their validity, and embed these proofs within transactions on the Bitcoin blockchain.

PoP Miners are incentivized for their work with rewards paid in HEMI tokens. By publishing these proofs to Bitcoin, they create an immutable and publicly verifiable record of the Hemi chain's state. A Hemi block is considered final after a confirmation delay of nine Bitcoin blocks, which is approximately 90 minutes. This delay is a security measure designed to account for the variable nature of Bitcoin block times and transaction fees, ensuring that the anchored state is part of a stable and irreversible segment of the Bitcoin chain. ^[7]

Tunnels

Tunnels are Hemi's native mechanism for cross-chain asset transfers between Bitcoin, Ethereum, and the Hemi network. This system is designed to eliminate the need for traditional third-party bridges, which can introduce additional security risks and centralization vectors. Tunnels operate at the protocol level by directly tracking the state of the connected blockchains, avoiding the use of external relayers. ^[2]

The process for transferring assets via Tunnels involves three main steps:

1. Deposit: A user locks their assets in a smart contract on the origin chain (e.g., Ethereum).
2. Mint: An equivalent amount of pegged tokens is created on the Hemi network, allowing the user to interact with DApps within the Hemi ecosystem.
3. Withdrawal: To retrieve the original assets, the user initiates a withdrawal, which burns the pegged tokens on Hemi. Upon finalization of this transaction, the original assets are released from the smart contract on the source chain.

As of September 2025, Tunnels support the transfer of assets based on the ERC-20 and BRC-20 token standards, with plans to expand support for other Hemi-native and Bitcoin-native assets. ^[7]

Developer Tools

Hemi provides a suite of tools to facilitate the development of Bitcoin-aware applications.

• Hemi Bitcoin Kit (hBK): This is a smart contract library and software development kit (SDK) designed for the Hemi network. The hBK simplifies the process for developers to access and query Bitcoin data from their smart contracts, leveraging the native capabilities of the hVM. ^{[2] [11]}
• Chainbuilder: This infrastructure solution allows developers to launch their own custom, application-specific networks. These networks inherit the security of Bitcoin through Hemi's PoP consensus and the programmability of the Hemi ecosystem. ^[2]
• Native BTC Re-staking: This feature enables users to stake native Bitcoin directly. Protocols built on Hemi can then use this re-staked BTC to enhance their own security, while users can earn yield on their Bitcoin holdings without converting them to wrapped assets. ^[2]

Tokenomics

The native utility token of the Hemi protocol is HEMI. It is designed to play a central role in the network's governance, security, and operation.

Utility

The HEMI token has several primary functions within the ecosystem:

• Governance: HEMI holders can participate in the protocol's governance by voting on proposals related to network upgrades, parameter changes, and other ecosystem-wide decisions.
• Gas Fees: The token is used to pay for transaction fees on the Hemi network. This includes fees for deploying smart contracts, interacting with Bitcoin's state via the hVM, and executing cross-chain transfers through Tunnels.
• Security and Staking: Users can stake HEMI to contribute to the security of the network and support the Proof-of-Proof consensus mechanism. By staking HEMI, participants receive veHEMI, which grants them the ability to earn a share of network rewards, including block rewards and a portion of transaction fees.

These utilities are designed to create a circular economy where the token's demand is tied to network activity and security. ^[7]

Supply and Distribution

The HEMI token has a maximum supply of 10,000,000,000 (10 billion) tokens. As of its launch in late 2025, the token was introduced to the market through various channels, including a Binance HODLer Airdrop. For this event, 100,000,000 HEMI, equivalent to 1% of the total supply, were allocated to eligible Binance users. In addition to the airdrop, another 100,000,000 HEMI tokens were reserved for marketing campaigns and community activities to be utilized within six months of the announcement. The token exists as an ERC-20 token on the Ethereum network. ^{[5] [7] [11]}

Use Cases

Hemi's technology is intended to enable a wide range of applications that were previously difficult or impossible to build with native Bitcoin. Potential use cases include:

• Low-Fee Bitcoin DeFi: Building lending, borrowing, and automated market maker (AMM) platforms that use native Bitcoin as collateral.
• Non-Custodial Bitcoin Services: Creating applications for services like self-wrapping BTC or trustless escrow systems.
• Cross-Chain Exchanges: Facilitating decentralized trading between native assets from the Bitcoin, Ethereum, and Hemi ecosystems.
• Multi-Chain DAOs: Establishing decentralized autonomous organizations whose governance models can incorporate token holders from both the Bitcoin and Ethereum communities.
• Bitcoin-Backed Finance: Developing financial products and settlement systems that are backed by and settled in native BTC.
• Bitcoin-Secured AI: Using the Hemi network to publish and verify AI model hashes, securing them with the immutability of the Bitcoin blockchain.

These use cases leverage Hemi's ability to read Bitcoin's state and execute complex logic in an EVM environment. ^[2]

Ecosystem and Partnerships

Hemi has established a network of investors, infrastructure providers, and DeFi protocols to support its growth. The project secured $15 million in funding from investors including Breyer Capital, Big Brain Holdings, Crypto.com, Gate Ventures, BTC Inc, HiperChain, and Republic. The funding round was co-led by Binance Labs, which has also supported the project through its listing and airdrop programs. ^{[2] [5] [8]}

For its technical infrastructure, Hemi is integrated with Infura's MetaMask Developer platform, with decentralized infrastructure support provided by DINBuild. Upon its launch, the project announced several key partnerships to bootstrap liquidity and user activity. Its bridging infrastructure is powered by StargateFinance, with user interfaces for bridging provided by platforms like Oku. To incentivize participation in its DeFi ecosystem, Hemi implemented a rewards program managed by Merkl. Integrated DeFi protocols include SushiSwap V3, izumi Finance, Spectra, and Gearbox Protocol. The rapid expansion of its DeFi ecosystem led to the onboarding of over 90 active protocols by late September 2025. ^{[3] [9]}