I created a thread about layer 2 solutions for Bitcoin, the
Sidechain Observer.
I have looked a bit in the so-called "
Litepaper" of the Fractal Bitcoin "project". I have to say that this is one of the worst "whitepapers" I've seen, if I'm not missing something.
It doesn't explain anything, only some ominous "virtualization" concept is mentioned. But the big problem, to solve the double spending problem on the Layer-2 (i.e. ensuring that no L2 bitcoin is created without a L1 bitcoin locked), is not even touched in this "Litepaper". Sidechains and layer-2's that "could" work employ complex two-way pegs, and there is no hint how this could be achieved on this "layer".
The website is fractalbitcoin.io, for those who want to risk a look at this. But I'm ... let's say extremely sceptic. It touches many red flags: technobabble, more imagery on the website than text, namedropping (a whitepaper mentioning Satoshi without good reason is often dubious) and "historydropping" (talking a bit too much about Bitcoin's history). And also Ordinals are mentioned like if it was a big innovation, which is also not correct, but many "L2s" like to mention them for no reason, because you don't need a "L2" for off-chain Inscriptions (you can use any altcoin chain actually). See the thread I linked above for examples.
An interesting project related to virtualization on Bitcoin is
BitVM but it is currently in pre-alpha state, an updated whitepaper has been published recently.