Re: [bitcoin-dev] Blind Merged Mining with covenants ( sighash_anyprevout / op_ctv )
Hello Nick, Thank you for your interest. It is quite different. Unlike MainStay, BMM isn't federation controlled. It's a decentralized consensus mechanism that can function entirely without a federation. BMM blocks are chosen by the highest bidder, which can be anyone. Note that it would be entirely possible for federations to issue two-way pegged tokens on this decentralized chain, but keep in mind you'll have two chains to worry about in terms of reorg potential (i.e. slow peg-outs). Cheers, Ruben On Thu, Dec 26, 2019 at 1:32 PM Nick Gregory wrote: > This not similar to MainStay? > > https://commerceblock.readthedocs.io/en/latest/mainstay/index.html > > https://mainstay.xyz > > > On Thu, Dec 26, 2019 at 2:25 AM Ruben Somsen via bitcoin-dev < > bitcoin-dev@lists.linuxfoundation.org> wrote: > >> Blind Merged Mining (BMM) is the idea of committing the hash of another >> blockchain into a unique location on the Bitcoin blockchain, and paying a >> Bitcoin fee to miners for the privilege of deciding this hash and capturing >> the fees inside the other blockchain. Since miners don’t have to know what >> the hash represents and are simply incentivized to choose the highest >> bidder, it requires no extra validation on their part (“blind”). This idea >> was originally conceived of by Paul Sztorc, but required a specific soft >> fork. [0] >> >> In essence, BMM is a mechanism that allows external blockchains >> (altcoins, tokens) to outsource their mining to the Bitcoin blockchain. >> Instead of burning electricity with ASICs, they pay bitcoins to miners, who >> in turn will perform Proof-of-Work (PoW) for the privilege of obtaining >> this payment. This increases the total PoW on the Bitcoin blockchain, which >> adds to the security of the Bitcoin network. It's an easy consensus >> mechanism to implement, and simple to mine, only requiring full node >> software for both chains and some bitcoins. >> >> While it may be hard to justify this as a soft fork, it turns out that >> the inclusion of sighash_anyprevout (previously sighash_noinput) into >> Bitcoin is sufficient to make BMM work, because, as noted by Anthony Towns >> [1], sighash_anyprevout allows for the creation of op_checktemplateverify >> (op_ctv, previously op_securethebag) style covenants [2]. With that, we can >> generate the following without any trusted setup: >> >> - A long string of sighash_anyprevout transactions, each only spendable >> by the next (the spending signature is placed in the output script, making >> it a covenant) >> - RBF enabled and signed with sighash flags single, anyonecanpay, and >> anyprevout, allowing the addition of inputs and outputs in order to pay >> fees (similar to fees in eltoo [3]) >> - A relative locktime of one block, ensuring only one transaction gets >> mined per block >> >> A complete transaction flow diagram can be found here: >> >> https://gist.github.com/RubenSomsen/5e4be6d18e5fa526b17d8b34906b16a5#file-bmm-svg >> >> (Note that op_ctv instead of sighash_anyprevout would require the use of >> CPFP, because all outputs need to be pre-defined.) >> >> This setup generates a unique location for the hash, which can be freely >> competed for by anyone with the help of RBF. The hash can be committed into >> the fee paying output via taproot. If the block corresponding to the hash >> is not revealed or invalid, then the BMM block simply gets orphaned, just >> like in Sztorc’s proposal. >> >> While the Bitcoin blockchain will be unaware of the BMM chain, the >> opposite does not have to be true. This enables some interesting >> possibilities. For instance, you could make a conditional BMM token >> transfer that only goes through if a specific Bitcoin transaction occurs >> within a certain period of time, thus enabling atomic swaps (especially >> useful when combined with asset issuance/colored coins/pegged tokens). It >> would also be possible to create contracts based on Bitcoin’s hashrate and >> such. >> >> It seems inevitable that this chain will need some kind of native token >> in order to pay for fees. This makes me uneasy. The fairest and least >> speculation-inducing method I can think of is a perpetual one-way peg, >> where at any time 1 BTC can be burned for 1 token, essentially preserving >> the 21M coin limit. Coins that are burned will never return, benefiting all >> BTC holders equally. Holding BTC will always be preferable, because the >> option to move is always open to you. This should disincentivize >> speculation -- it only makes sense to move coins if they serve an immediate >> purpose. >> >> Given the lack of a block subsidy, there may not be enough impetus to >> move the chain forward instead of enacting a reorg. However, BMM reorgs are >> somewhat unique in that they will have to compete for the same unique >> location that the original chain is using. A 10-block reorg would take 100 >> minutes on average to catch up, during which the original chain won’t move >> forward. If fee pressure
Re: [bitcoin-dev] Blind Merged Mining with covenants ( sighash_anyprevout / op_ctv )
This not similar to MainStay? https://commerceblock.readthedocs.io/en/latest/mainstay/index.html https://mainstay.xyz On Thu, Dec 26, 2019 at 2:25 AM Ruben Somsen via bitcoin-dev < bitcoin-dev@lists.linuxfoundation.org> wrote: > Blind Merged Mining (BMM) is the idea of committing the hash of another > blockchain into a unique location on the Bitcoin blockchain, and paying a > Bitcoin fee to miners for the privilege of deciding this hash and capturing > the fees inside the other blockchain. Since miners don’t have to know what > the hash represents and are simply incentivized to choose the highest > bidder, it requires no extra validation on their part (“blind”). This idea > was originally conceived of by Paul Sztorc, but required a specific soft > fork. [0] > > In essence, BMM is a mechanism that allows external blockchains (altcoins, > tokens) to outsource their mining to the Bitcoin blockchain. Instead of > burning electricity with ASICs, they pay bitcoins to miners, who in turn > will perform Proof-of-Work (PoW) for the privilege of obtaining this > payment. This increases the total PoW on the Bitcoin blockchain, which adds > to the security of the Bitcoin network. It's an easy consensus mechanism to > implement, and simple to mine, only requiring full node software for both > chains and some bitcoins. > > While it may be hard to justify this as a soft fork, it turns out that the > inclusion of sighash_anyprevout (previously sighash_noinput) into Bitcoin > is sufficient to make BMM work, because, as noted by Anthony Towns [1], > sighash_anyprevout allows for the creation of op_checktemplateverify > (op_ctv, previously op_securethebag) style covenants [2]. With that, we can > generate the following without any trusted setup: > > - A long string of sighash_anyprevout transactions, each only spendable by > the next (the spending signature is placed in the output script, making it > a covenant) > - RBF enabled and signed with sighash flags single, anyonecanpay, and > anyprevout, allowing the addition of inputs and outputs in order to pay > fees (similar to fees in eltoo [3]) > - A relative locktime of one block, ensuring only one transaction gets > mined per block > > A complete transaction flow diagram can be found here: > > https://gist.github.com/RubenSomsen/5e4be6d18e5fa526b17d8b34906b16a5#file-bmm-svg > > (Note that op_ctv instead of sighash_anyprevout would require the use of > CPFP, because all outputs need to be pre-defined.) > > This setup generates a unique location for the hash, which can be freely > competed for by anyone with the help of RBF. The hash can be committed into > the fee paying output via taproot. If the block corresponding to the hash > is not revealed or invalid, then the BMM block simply gets orphaned, just > like in Sztorc’s proposal. > > While the Bitcoin blockchain will be unaware of the BMM chain, the > opposite does not have to be true. This enables some interesting > possibilities. For instance, you could make a conditional BMM token > transfer that only goes through if a specific Bitcoin transaction occurs > within a certain period of time, thus enabling atomic swaps (especially > useful when combined with asset issuance/colored coins/pegged tokens). It > would also be possible to create contracts based on Bitcoin’s hashrate and > such. > > It seems inevitable that this chain will need some kind of native token in > order to pay for fees. This makes me uneasy. The fairest and least > speculation-inducing method I can think of is a perpetual one-way peg, > where at any time 1 BTC can be burned for 1 token, essentially preserving > the 21M coin limit. Coins that are burned will never return, benefiting all > BTC holders equally. Holding BTC will always be preferable, because the > option to move is always open to you. This should disincentivize > speculation -- it only makes sense to move coins if they serve an immediate > purpose. > > Given the lack of a block subsidy, there may not be enough impetus to move > the chain forward instead of enacting a reorg. However, BMM reorgs are > somewhat unique in that they will have to compete for the same unique > location that the original chain is using. A 10-block reorg would take 100 > minutes on average to catch up, during which the original chain won’t move > forward. If fee pressure of new transactions is targeted exclusively > towards the original chain during this time [4], there would be forward > pressure that makes reorgs more expensive. Whether this mitigation is > sufficient is an open question. > > Finally, it is worth asking whether BMM interferes too much with the > existing incentive structure of Bitcoin. I don’t have a clear answer, but > it should be noted that a much more inefficient version of BMM is already > possible today. One could simply use up lots of block space instead of > specifying a unique location for the hash, as demonstrated by Veriblock > [5]. I therefore believe that the same argument as
[bitcoin-dev] Blind Merged Mining with covenants ( sighash_anyprevout / op_ctv )
Blind Merged Mining (BMM) is the idea of committing the hash of another blockchain into a unique location on the Bitcoin blockchain, and paying a Bitcoin fee to miners for the privilege of deciding this hash and capturing the fees inside the other blockchain. Since miners don’t have to know what the hash represents and are simply incentivized to choose the highest bidder, it requires no extra validation on their part (“blind”). This idea was originally conceived of by Paul Sztorc, but required a specific soft fork. [0] In essence, BMM is a mechanism that allows external blockchains (altcoins, tokens) to outsource their mining to the Bitcoin blockchain. Instead of burning electricity with ASICs, they pay bitcoins to miners, who in turn will perform Proof-of-Work (PoW) for the privilege of obtaining this payment. This increases the total PoW on the Bitcoin blockchain, which adds to the security of the Bitcoin network. It's an easy consensus mechanism to implement, and simple to mine, only requiring full node software for both chains and some bitcoins. While it may be hard to justify this as a soft fork, it turns out that the inclusion of sighash_anyprevout (previously sighash_noinput) into Bitcoin is sufficient to make BMM work, because, as noted by Anthony Towns [1], sighash_anyprevout allows for the creation of op_checktemplateverify (op_ctv, previously op_securethebag) style covenants [2]. With that, we can generate the following without any trusted setup: - A long string of sighash_anyprevout transactions, each only spendable by the next (the spending signature is placed in the output script, making it a covenant) - RBF enabled and signed with sighash flags single, anyonecanpay, and anyprevout, allowing the addition of inputs and outputs in order to pay fees (similar to fees in eltoo [3]) - A relative locktime of one block, ensuring only one transaction gets mined per block A complete transaction flow diagram can be found here: https://gist.github.com/RubenSomsen/5e4be6d18e5fa526b17d8b34906b16a5#file-bmm-svg (Note that op_ctv instead of sighash_anyprevout would require the use of CPFP, because all outputs need to be pre-defined.) This setup generates a unique location for the hash, which can be freely competed for by anyone with the help of RBF. The hash can be committed into the fee paying output via taproot. If the block corresponding to the hash is not revealed or invalid, then the BMM block simply gets orphaned, just like in Sztorc’s proposal. While the Bitcoin blockchain will be unaware of the BMM chain, the opposite does not have to be true. This enables some interesting possibilities. For instance, you could make a conditional BMM token transfer that only goes through if a specific Bitcoin transaction occurs within a certain period of time, thus enabling atomic swaps (especially useful when combined with asset issuance/colored coins/pegged tokens). It would also be possible to create contracts based on Bitcoin’s hashrate and such. It seems inevitable that this chain will need some kind of native token in order to pay for fees. This makes me uneasy. The fairest and least speculation-inducing method I can think of is a perpetual one-way peg, where at any time 1 BTC can be burned for 1 token, essentially preserving the 21M coin limit. Coins that are burned will never return, benefiting all BTC holders equally. Holding BTC will always be preferable, because the option to move is always open to you. This should disincentivize speculation -- it only makes sense to move coins if they serve an immediate purpose. Given the lack of a block subsidy, there may not be enough impetus to move the chain forward instead of enacting a reorg. However, BMM reorgs are somewhat unique in that they will have to compete for the same unique location that the original chain is using. A 10-block reorg would take 100 minutes on average to catch up, during which the original chain won’t move forward. If fee pressure of new transactions is targeted exclusively towards the original chain during this time [4], there would be forward pressure that makes reorgs more expensive. Whether this mitigation is sufficient is an open question. Finally, it is worth asking whether BMM interferes too much with the existing incentive structure of Bitcoin. I don’t have a clear answer, but it should be noted that a much more inefficient version of BMM is already possible today. One could simply use up lots of block space instead of specifying a unique location for the hash, as demonstrated by Veriblock [5]. I therefore believe that the same argument as adding data via op_return applies here -- if it’s not supported, more wasteful methods may be utilized instead. Some technical details (thanks to Anthony Towns for providing his insights): - Since the exact signature is committed to ahead of time, private key security is actually irrelevant. You can simply use G to replace both R and P instead of the usual s = r + e*p. This means
