The introduction of BITVM smart contracts marks a major milestone in the path for bitcoin scalability and programmerism. Rooted in the original BitVM protocol, Bitlayer's Finality Bridge presents the first version of the protocol live on TestNet. This is a good starting point for realizing the promise of the Bitcoin Renaissance or “Season 2”!
Unlike previous BTC bridges, which often require centralized entities or relying on suspicious trust assumptions, Finality Bridge leverages a blend of BITVM smart contracts, fraud proofs, and zero-aware proofs. This combination not only enhances security, but also significantly reduces the need for trust in third parties. Although not at the unreliable level that Lightning offers, this is one million times better than the current sidechain design that claims to be Bitcoin Layer 2 (which greatly increases the design space for Bitcoin applications) (In addition to).
The system works on the principle that the fund is securely locked to an address controlled by the BITVM smart contract, and that at least one participant in the system acts honestly. This setup inherently reduces the reliability requirements, but requires the introduction of additional complexity that Bitlayer aims to manage with this version of the bridge.
How trust works
Practically, if Bitcoin is locked to a BitVM smart contract via Finality Bridge, the user is issued a YBTC. This peg is not just a promise, but is enforced by the underlying smart contractor, ensuring that each YBTC represents an actual locked bitcoin on the main chain (fake “repacking”) (There are no BTC metrics). This mechanism allows users to participate in debt activities such as lending, borrowing, and agriculture within the Bitcoin ecosystem without compromising on the security and settlement guarantees offered by Bitcoin.
Some people in the community may find these activities undesirable, but this type of architecture allows users to get assurance that they didn't want to use traditional Sidechain designs before. Masu. That happens (the contract will be “trust” Bitcoin Layer 2 by fully “trust the design of this bridge). For more information on the different levels of risk associated with sidechain design, see Bitlayer evaluation for Bitcoin Layers.
However, until such advancements come into effect, the Bitlayer Finality Bridge will serve as the best realization of the Bitvm 2 paradigm. This is evidence of what is possible after the “brain drain” of development from the developed chain back to Bitcoin. Despite all the challenges faced by the BITVM chain, I remain extremely excited by the prospect that Bitcoin will fulfill its destiny as the ultimate settlement chain of all economic activity.
This article is a take. The opinions expressed are entirely the authors and do not necessarily reflect the opinions of BTC Inc or Bitcoin Magazine.
In particular, Guillaume's article may discuss topics and companies that are part of his company's investment portfolio (UTXO Management). The views expressed are solely himself and do not represent the opinions of his employer or its affiliates. He has not received financial compensation for these takes. Readers should not view this content as financial advice, approval of a particular company, or investment. Always do your own research before making any financial decisions.
