John Newbery is a Bitcoin Core developer and Chaincode Labs engineer. This article is the future course of Bitcoin that he shared on Twitter. He believes that in 2020, Lightning Network, Schnorr / Taproot, Payjoin, miniscript and other technologies will have more development.
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The end of the decade is a good time for us to look back at history and marvel at the tremendous progress Bitcoin has made since Satoshi Nakamoto gave us a glimpse of the Bitcoin white paper in 2008. Of course, this naturally made us start to look forward to what will happen in the next few years.
I think some are the development direction of Bitcoin in the next few years. If you think it is incorrect, then please tell me why I was wrong and what was wrong!
The Lightning Network protocol team (C-lighting from Blockstream, eclair from Acinq, LND from Lighting Labs) and the robust Lightning Network will continue to iterate rapidly.
All implementations now support basic multi-path payments . We will provide better support for this, as well as dual-funding, splice-in and splice-out .
Taken together, these technologies will make lightning channel and liquidity management easier. They will execute automatically and the user experience will be greatly improved.
Lightning network infrastructure will be improved, as Bitfinex has recently supported Lightning Network Bitcoin deposits and withdrawals. All other exchanges, merchant service providers, custodians and wallets will follow, otherwise they will fall behind.
We will see more Lightning web wallets: unmanaged hybrid wallets; outsourced routing self-hosted wallets; fully self-managed wallets. This is a brand new field and there will be a large number of experimental products. Different teams will find different positions. Like Muun, Breez, Phoenix, Zap, Bluewallet, etc., these wallets are experimenting with different models.
Tools for Lightning Network developers will also be improved. More than a year ago, when we ran a lightning application, developers spent a lot of time setting up their lightning development environment.
Now, with Polar developed by Jamal James, Lightning web application developers can set up a test environment with just a few clicks. More and more useful tools will continue to appear. With these better tools, we will see faster innovation at the application layer. ZEBEDEE and Satoshi's Games and other teams we haven't heard of yet will bring us a new and exciting exciting lightning experience.
Schnorr / Taproot
The Schnorr / Taproot soft fork will be activated in 2020 or 2021. This will provide huge improvements in terms of substitutability, privacy, scalability, and functionality. For an overview of the benefits, watch the introduction of Optech executives here: link
This will enable Lightning Network to upgrade from HTLC to Payment Points. This greatly improves privacy and de-correlation of payments, and allows "no fixed payments" with proof of payment-another huge increase in Lightning Network availability. (For more information on Payment Points)
Even better, the opening and closing of the Lightning Channel looks the same as the payment to a single pubkey. The same is true for payments to nk pubkey thresholds. This is good for replaceability, privacy, and scalability.
In fact, using schnorr / taproot, using advanced scripts instead of a single pubkey output to hinder UTXO has few disadvantages.
Cold storage UTXO will be k-of-n key trees with n signatures, and all hot wallet UTXOs will be stored in the channel (with splicing-out for on-chain payments). When transactions hit the entire chain, they will look like any other single pubkey / signature payment.
Payments to the wallet will be paid directly to the open output of the channel (thanks @esneider for pointing me to this). There will be no concept of on-chain balances and in-channel balances. Only a unified balance is needed for Lightning Network or on-chain payments.
The wallet team will collaborate on the PayJoin payment agreement. A large number of on-chain transactions will be 2-input-2-output transactions, which greatly improves the replaceability and privacy, and resists on-chain analysis.
The input of these PayJoin transactions may be channel splicing, and the output may be channel opening, but it cannot be distinguished by observing the blockchain.
Ultimately, we will perform cross-input signature aggregation , which means that these PayJoin transactions will only have one signature and will be "cheaper" than regular changes to generate transactions.
Larger coinjoins transactions will still be cheaper. The advanced PayJoin payment protocol can even make multiple payments to the same merchant / exchange in bulk, and uses only one signature.
We will get SIGHASH_NOINPUT or SIGHASH_ANYPREVOUT to make eltoo possible and blur the line between Layer 1 and Layer 2 .
This will make the Lightning Network more usable and allow more advanced Layer 2 contracts (such as the Channel Factory ).
All these advanced features will require greater wallet interoperability. Then you need miniscript .
With miniscript, wallets will eventually be able to contract with each other without needing to pre-template scripts (like the current Lightning Network). The interoperability of this wallet will allow for faster innovation in the Layer 2 contract.
OP_CTV or other opcodes that support the contract will be activated, allowing the use of richer Layer 2 constructs, such as joinpools .
Together with Taproot and SIGHASH_NOINPUT, we will become very rich, and private off-chain contracts will become possible.
Some of these things will happen in 2020 and some will take longer, but they are all moving in the same direction: using blockchain where it is good at it (h / t Andrew Poesltra).
That is to say: the blockchain allows nodes to reach the agreed ledger state, while contracts and functions are moved up to Layer 2. It's cheaper, safer, more private, and allows for faster innovation.
All this is inevitable, but this cannot happen without the efforts of many people and the creativity of many thoughts. Developers, researchers, businesses, and users still have a lot of work to do.