Author: Tamas Blummer 2014-12-16 12:30:04
Published on: 2014-12-16T12:30:04+00:00
Tamas Blummer, founder of Bits of Proof, has proposed a new mining algorithm for side chains that uses Bitcoin to secure them. The rules of the side chain require that a transaction on the Bitcoin blockchain destroys Bitcoins with an OP_RETURN output that contains the hash of the block header of the side chain. To introduce a lottery, the burn transaction's hash is required to satisfy some function of the block hash it was included in on the Bitcoin blockchain. Those who want to mine the side chain will assemble side chain block candidates that comply with the side chain's rules, then submit a Bitcoin transaction burning the hash of the block candidate to the Bitcoin network. If the burn transaction is included in the Bitcoin block chain and the Bitcoin block's hash satisfies the lottery criteria, then the block candidate can be submitted to extend the side chain. A side chain block header sequence would be accepted as a side chain trunk if a sequence of Bitcoin SPV proofs for burn transactions proves that linked blocks have the highest cumulative burn compared to alternative sequences. In this way, there is no need for Bitcoin miner support or consent for the merged mining. Mining difficulty for the side chain could be adjusted by stepping up the required burn and/or hardening the criteria that links a burn proof transaction with the bitcoin block hash it is included in. The difficulty to mine with burn would be dynamic and would also imply a floating exchange rate between Bitcoin and the side coin.
Updated on: 2023-06-09T14:36:51.433919+00:00