A novel proposal by a Bitcoin developer aims to introduce more versatile off-chain smart contracts to the Bitcoin network without the necessity of a soft fork. This groundbreaking concept, detailed in an October 9th white paper titled “BitVM: Compute Anything on Bitcoin” by Robin Linus, the project lead at ZeroSync, introduces the BitVM system, enabling Turing-complete Bitcoin contracts while preserving Bitcoin’s core consensus rules.
In essence, a Turing Complete system possesses the ability to theoretically solve any computational problem. BitVM achieves this by executing the “logic” of Bitcoin contracts off-chain, with the verification process taking place on the Bitcoin network, similar to Ethereum’s optimistic rollups.
The architecture of BitVM relies on fraud proofs and a challenge-response model. In this setup, a “prover” can make claims, and a “verifier” can utilize fraud-proof mechanisms to penalize the prover for making false claims.
In its current form, Bitcoin is limited to basic operations like signatures, timelocks, and hashlocks. BitVM promises to expand these capabilities, opening the door to various applications. This includes possibilities like implementing games such as Chess, Go, or Poker, as well as verifying the validity of proofs within Bitcoin contracts. Additionally, BitVM could potentially facilitate bridging Bitcoin to other blockchain networks, developing prediction markets, or emulating novel opcodes.
However, BitVM has certain limitations, including its confinement to a two-party setting involving a prover and a verifier. It also necessitates a substantial amount of off-chain computation and communication to execute programs effectively.
Robin Linus outlined the next milestone as the full implementation of BitVM, in addition to Tree++, a high-level programming language designed for writing and debugging Bitcoin contracts.
It’s important to note that BitVM’s functionality was made possible by the Taproot soft fork, which occurred in November 2021. Linus acknowledged the contributions of Ethereum research into optimistic rollups and a study on Merkle Trees in shaping the ideas presented in the eight-page white paper.
Within the Bitcoin community, reactions to BitVM vary. Prominent Bitcoiner Eric Wall expressed optimism on Twitter, describing the concepts in the white paper as promising and expressing cautious excitement about potential real-world experiments.
Bitcoin analyst Dylan LeClair also praised BitVM’s white paper. In contrast, Bitcoin Core contributor Adam Back urged caution and advised against prematurely building high expectations.
Some developers have already created a proof-of-concept for BitVM on GitHub. Furthermore, users have reassured Bitcoin maximalists that BitVM does not compel Bitcoin to be locked into these advanced contracts, as participation is entirely optional.
This flexibility aligns with the inherent security features of the UTXO (Unspent Transaction Output) system, allowing users to choose whether to engage with Turing’s complete smart contracts.