Shinobi’s Strawman is a weekly series where our technical editor Shinobi challenges the Bitcoin community, with the goal of sparking conversation around hot technical debates.
We’re going to try something today.
Chains are heralded by some as the savior of Bitcoin, the answer to all its problems. It solves the long-term security budget problem, allows complete freedom to integrate new features into Bitcoin, and presents no downsides to existing Bitcoin users.
Sound too good to be true? that it:
1) Chains of command change miners’ incentives
Lead chains introduce a patchwork of new variables into miner incentives, and after introducing this instability, advocates are pushing users to adopt a degraded security model for all new use cases and functionality using a sidechain rather than changing the underlying layer. How is this different from a direct attack on Bitcoin’s self-sequestration?
2) No support for existing sidechains
There have been many different design proposals for sidechains over the years, but the only currently published proposals are managed by consortiums (Liquid and RSK), both of which have failed to gain any meaningful level of adoption since their publication. Does this mean that sidechains are not worth the continuous development effort? Or is it worth it, and the failure to adopt federated chains is simply a result of shortcomings in the specific sidechain design?
3) Drive chains exacerbate MEV risks
MEV is something that is already possible on Bitcoin, As systems like Stacks demonstrate, but currently, possible MEVs on Bitcoin are generated either by completely independent altcoins such as Stacks (which have historically tended to generate a small percentage of miners’ income, such as Namecoin), or are very low in complexity (such as pioneering coins). . Lead chains open the door to arbitrarily complex forms of MEV on sidechains, while also ensuring that the token generating those MEV is tied to the price of Bitcoin. That is, it cannot simply vanish into an irrelevant portion of the miner’s income when people stop buying altcoins. This greatly exacerbates the potential risks and damage of MEV to Bitcoin.
4) No, swap markets are not an answer
Paul Stork He replied To some of these concerns on Twitter, but these responses don’t really address the root issues. Swap markets may seem like an answer, but the reality is that these markets merely push liquidity requirements onto another party, on the assumption that they will provide massive amounts of liquidity for almost nothing in return. This may work for small utility users, or with liquidity available to arbitrage the uncertainty around the peg, I don’t think it is certain enough liquidity to cover the “security budget problem solution” without slippage is a given, say nothing about all the other users who would like to Switch in and out. He then goes on to ignore the difference between main-chain reorganization, which requires rework and energy expenditure, versus side-chain reorganization, which does not. Finally, it equates to a random person without any logical or profit-driven reason donating money with someone who is making a profit through an activity for which they are the sole gatekeepers.
Look, in the end, I’m a Bitcoin fan. I want what is best for Bitcoin.
I think chains of command are stupid, dangerous, and a waste of time, but I want to hear your thoughts on the subject. Am I wrong in the above points? Is there another reason why I should disagree with the chains of command I ignored?
Please don’t write to me with some random hopium. I am open to new opinions. I want the conversation to move forward. Above is my best summary – we are simply not close to any meaningful consensus on chains of command.
My DMs are open. Opinion@bitcoinmagazine.com. Let’s hash it out.
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