Like it or love it, this abbreviated week of rags from this dark corner of the Internet is hyper-focused on Taproot activation. On Monday, I laid out my thesis that Taproot is a catalyst that will take Jevons Paradox into a higher gear within the Bitcoin protocol. Today, I'd like to get away from my wacky theories and highlight people much smarter than me who are actively working to leverage the benefits of Taproot to improve the Bitcoin protocol and the layers above it.
As we've discussed many times in this rag, Taproot activation enables bitcoiners to open channels on the Lightning Network in a new way by leveraging Point Time Locked Contracts (PTLCs) instead of Hash Time Locked Contracts (HTLCs). The transition from HTLCs to PTLCs will bring with it privacy and efficiency gains, which everyone wants. However, before we're able to realize the benefits from a transition, bitcoiners working on and using the Lightning network need to figure out how to transition. Up until recently, this has been an unanswered question that many have been loosely brainstorming about off the record.
Well, last month a number of developers working on the Lightning Network met in Zurich to discuss the current state of the network and ways in which they can continue to improve it. Luckily for us Olaoluwa Osuntokun, CTO of Lightning Labs, took detailed meeting minutes and shared those on the lightning-dev mailing list. A large focus of the discussions was on how to best transition from HTLCs to PTLCs. Above are a couple of snippets from Olaoluwa's notes which give a high level synopsis of two different approaches. As of right now developers are weighing two different approaches; a "big bang" transition where everyone transitions at once, and a slow iterative transition that happens in chunks over time.
Off the bat, I am partial to the iterative process. In my opinion, the "big bang" transition is preferable but not very practical as it seems like it would be extremely hard to coordinate every node operator at once. The iterative route seems more practical but also comes with the risk of falling prey to second-system syndrome.
After roughly twenty four hours of contemplation on this, this is where I currently stand. This is subject to change as more information and context comes to light. At the very least, I am extremely happy these discussions are being had and ideas are coming to the surface. This is only the beginning of the conversation and I look forward to watching it evolve to a point that produces a viable solution.
What do you think?
Bill Burr is a don.
Enjoy your weekend, freaks.