Author: Thomas Hartman 2023-05-01 23:48:14
Published on: 2023-05-01T23:48:14+00:00
The paper "Blockrate Binaries on Bitcoin mainnet" presents a formalization of the Powswap protocol, which involves hashrate derivatives as off-chain contracts between two users for making peer-to-peer binary contracts on the future rates of block discovery. The paper describes the protocol steps in detail and the threat model, including contentions and transaction confirmation racing in edge cases. Infrastructure for counterparty discovery and selection is also discussed, with potential use of Discreet Log Contracts or other protocols. The Blockrate Binary Options could operate on top of Lightning payment channels, although further protocol design is needed. It is not yet established whether these options would be useful financial tools for Bitcoin users, but they may be useful to miners for hedging their operations and providing a decentralized price indicator and a means of derivative trading. The authors welcome protocol researchers and experienced core and lightning software developers to help solve remaining blockers. Private inquiries can be directed to the author's email.
Updated on: 2023-06-16T18:12:41.064743+00:00