A team of crypto developers has published a detailed plan to enable transaction rollups on Bitcoin, a common practice in crypto that was deemed impossible on the grandfather blockchain.
Rollups are a decentralized system for bundling crypto transactions off-chain before settling them together on-chain in more target=”_blank”>scaling solution for Ethereum. The creators of the proposed Bitcoin framework say rollups will deliver more than increased capacity.
“They bring full Turing complete functionality to Bitcoin,” said Edan Yago, a co-author of the Bitcoin rollup framework BitSNARK and Grail, in a message to Decrypt. Turing completeness would mean Bitcoin can use smart contracts, thus enabling decentralized finance (DeFi) and other applications found on other blockchains.
1/ NEW WHITEPAPER: BitSNARK & Grail—Bitcoin Rails for Unlimited Smart Contracts and Scalability. This is a solution to Bitcoin’s trilemma of scale, computational expressivity, and decentralization. https://t.co/As6kJIQe2t
— Yago (@EdanYago) April 25, 2024
“Initially, we would expect a 10X scale or more that can maintain full Bitcoin security,” he continued. In a separate presentation earlier this year, the developer claimed Bitcoin rollup transactions could have infinite scalability in terms of both throughput and speed—at least theoretically.
Yago is a contributor to the Bitcoin DeFi platform Sovryn (SOV), which announced development on its Bitcoin rollup platform BitcoinOS in January. Unlike other scaling proposals, BitcoinOS requires no soft fork or hard fork upgrades to Bitcoin Core, which evolves deliberately and can be resistant to change.
Their whitepaper, published last week, introduces two innovations.
One is called BitSNARK, a software library for verifying zkSNARKS on Bitcoin. zkSNARKS are zero-knowledge cryptographic proofs of completed transactions that do not include or expose any other details.
BitSNARK is a core building block of their second innovation, Grail, which is a practical and scalable implementation of BitSNARK to create a Bitcoin rollup bridge. The Grail bridge would let Bitcoin blockchain users move their BTC (and other assets) back and forth between layer-2 networks (rollups) in a near trustless manner.
According to Yago, the design of Bitcoin rollups shares elements of both Ethereum’s ZK rollups and optimistic rollups.
“Bitcoin Rollups are a new beast,” he said. “They will use ZK proofs but verify them through a challenge/response sequence, similar in some ways to optimistic rollups.”
Moving BTC through BitcoinOS still requires intermediary agents called “operators” to assist with processing bridge deposits and withdrawals. Those operators are able to monitor the activity of their fellow operators at all times, preventing any of them from stealing users’ coins or processing a dishonest bridge transaction of any kind.
“As long as even a single operator remains honest the system maintains its integrity,” Yago said.
Yago says there is also “no theoretical limit to the number of participants” in the decentralized operator set. New operators can join, and old members can leave by following specific steps. Sovryn says it is working to create a bridge that works efficiently with over 100 operators.
3/
•DeFi?
•Low-cost transactions?
•BTC-Backed stablecoins?
•Private transactions?
•DAOs?All this will soon be built on BitcoinOS.
Sovryn will be the first to Launch a BitcoinOS rollup, bringing the power of DeFi, secured directly by Bitcoin, to the world.
— Sovryn | DeFi for Bitcoin (@SovrynBTC) April 25, 2024
The proposed rollup system is an outgrowth of Robin Linus’s revolutionary BitVM framework, which introduced the ability to compute anything on Bitcoin last year.
Unlike BitVM, BitSNARK is purpose-built for SNARK verification, the group says, overcoming the practical limitations and inefficiencies of its predecessor in supporting a Bitcoin rollup bridge.
“It offers an order of magnitude improvement to program size and as much as 50% reduction in challenge/response protocol length for the kind of computations required by bridges,” the whitepaper states.
The Grail bridge implementation also solves a significant limitation of BitVM bridges called out earlier this month. Crypto developer Tyler Whittle claimed users of such bridges could lose all of their funds if bridge operators were forced to process a massive withdrawal that exceeded their on-hand liquidity.
“Grail provides users a consistent ability to withdraw,” the whitepaper reads. “The application of a fee-market for priority withdrawals coupled with the ability to scale operators via dynamic membership, allows for continued smooth operation of withdrawal.”
Once functional, Yago said Sovryn’s BitcoinOS could render rival L2s and sidechains—such as Liquid, Rootstock, and Stacks—“completely obsolete.” While sidechains lack the direct security of the Bitcoin network or a decentralized Bitcoin peg, rollups have both, making them a major improvement.
In fact, Yago said, the bridge may be so decentralized that nobody could compromise it if they tried–not even the government.
“The system is absolutely designed to defeat state-level attackers,” Yago said. “A single honest coder in his basement can successfully defeat a coalition of nation-states.”
Edited by Ryan Ozawa.