CTV dramatically improves DLCs



Summary:

In a message to dlc-dev and bitcoin-dev, Jeremy Rubin provides some additional notes on the benefits of Discreet Log Contracts (DLCs) with OP_CTV. He notes that a 3/5th threshold would result in a total 300x improvement. Additionally, he suggests that CTV enables a "trustless timeout" feature whereby a failover claim returns funds to both sides. This can be achieved through an oracle-free CTV or by having the base DLC pay into a DLC that removes the just-used branch and replaces it with CTV containing a relative timelock. Jeremy also explains how CTV DLCs are non-interactive asynchronously third-party unilaterally creatable, enabling use cases like pay-to-DLC addresses. There are also opportunities for perpetual-like contracts that combine several DLCs closing one per month. Finally, Jeremy suggests that iterative DLCs in Lightning could benefit from a performance improvement by trading over a fixed set of attestation points with variable payout curves.


Updated on: 2023-06-15T15:22:52.077026+00:00