Author: Nicolas Dorier 2016-05-26 02:50:26
Published on: 2016-05-26T02:50:26+00:00
The Open Asset Protocol (OAP/1.0) is a well-known and simple colored coin protocol created by Flavien Charlon. It has been in existence for over two years and uses OP_RETURN to store the coin's color. The protocol allows for the creation and transfer of assets on top of the Bitcoin protocol, represented by tokens called colored coins. An issuer can issue colored coins and associate them with a promise that he will redeem the coins according to terms he has defined.Colored coins can be traded using transactions that preserve the quantity of every asset. The Open Assets Protocol allows outputs to encapsulate a quantity of a user-defined asset on top of the Bitcoin amount. This leads to many applications such as trading frictionlessly through the Bitcoin infrastructure or transacting in any currency. The Open Assets Protocol also provides Open Assets Transactions, which must have a special output called the marker output. This allows clients to recognize such transactions and can be used to issue new assets or transfer ownership of assets. The marker output separates issuance outputs from transfer outputs. Colored outputs can be identified by traversing the Blockchain without external data. The coloring process works by retrieving the asset quantities and asset IDs of the outputs referenced by each input of the transaction. Outputs are assigned asset quantities based on the asset quantity list field values provided in the marker output. Inputs and outputs are then seen as a sequence of asset units, and their asset IDs are determined using order-based coloring.The Open Assets Protocol is economical, pseudonymous, and uses OP_RETURN to avoid polluting the UTXO. Compatibility is maintained with existing Bitcoin clients, and new versions should be backwards compatible. The document is in the public domain.
Updated on: 2023-06-11T05:33:45.611630+00:00