RTC(Rootstock)根链白皮书.pdf
RSK White paper overview Page 2/24RSK Bitcoin powered Smart Contracts White paper Overview Revision 9 Date November 19th, 2015 By Sergio Demian Lerner Confidential RSK White paper overview Page 3/24Introduction Why Rootstock is important for the Bitcoin Ecosystem Alignment of Bitcoin Stakeholders and protection of value Governance model Protection of Bitcoin Miner s Investment Securing the Bitcoin / Rootstock 2-way peg Lower Bitcoin transactions fees and stable value asset issuing Bitcoin Security hardening Rootstock as a low-cost BTC payment network Rootstock Use Cases Micropayment channels and Hub-and-Spoke networks Peer-to-peer distributed exchange Retail Payment Systems Escrow Services Crypto-assets Creation Asset Securitization Decentralized remittances IP Protection / Registry Voting System Micro-lending Supply Chain Traceability Online Reputation Digital Identity In-game Global Currency Internet-gambling and Prediction Markets Fair-playing Technology Overview Turing-Complete virtual Machine Sidechain Semi-Trust-Free Sidechains Dynamic Hybrid Merged mining/Federation Fast payments and low-latency-network Rootstock Feature comparison Instant Payments Technology preview DECOR Protocol The block propagation protocol Two Stage Block Propagation 2SBP Push Missing Transactions protocol PMT Delayed Transaction Inclusion heuristic DTI Immediate Block Header Propagation IBHP Two Prioritized Streams for each Connection protocol 2PSC Mining on Unverified Blocks Heuristic MUB Local Route Optimization Protocol LRO Re-using the Bitcoin Mining Network The real topology of the network The PoW function Verification Time Client Networking Stack The Block Overhead Simulations Safe Merged mining RSK White paper overview Page 4/24Transaction Privacy Security Scalability Probabilistic Verification and Fraud Proofs Conclusions RSK White paper overview Page 5/24Introduction In2008SatoshiNakamotorevolutionizedpaymentsbycreatingBitcoin.Bitcoinincludeda verylimitedimplementationoftheso-called“smartcontracts”,aconceptintroducedback in 1993 by Nick Szabo. Since then, alot of researchhasbeendedicatedtothecreationof newcryptocurrencies that support full Turing complete distributed programs. Now there is a widespread confidencethat useful, secureanddeterministicvirtual machinescanbebuilttoachieve this goal. We believe that newuse cases arenecessaryinorderforBitcointobecometheleading global cryptocurrency, andthat adding smart-contract capabilities is key to securethat future. With that inmindwe createdRootstock RSK, a smart-contract platthat incorporates a Turing Complete Virtual Machine to Bitcoin. It also provides other enhancementtothenetworksuchasfastertransactionsandbetterscalability,featuresthat we also believe will enable new usage scenarios. RSKisanevolutionofQixCoin,aturing-completecryptocurrencycreatedbackin2013by the same development team. RSKprovides animprovedpayment experiencewithnear instant confirmations. It achievescurrently300tpsandconfirmsmost paymentsinless than 20 seconds. And yet, is still based on the same security guarantees Bitcoinhas, supporting SHA-256D merged mining. RSK works as a Bitcoin Sidechain. When Bitcoins are transferred into the Rootstock blockchain,theybecome“Rootcoins”RTC.Rootcoinsareequivalenttobitcoinslivingin theRootstockblockchain, andtheycanbetransferredbacktoBitcoinsatanytimeatno additionalcostexceptforstandardRootstocktransactionfees.RTCisthebasecurrency usedontheRSKsidechaintopayminersfortransactionandcontractprocessing.Thereis no currency issuance all RTC are created from Bitcoins coming from the Bitcoin blockchain. Rootstock enhances Bitcoin in the following areas Turing-complete Rootstock Virtual Machine RVM allowing smart-contracts Average first confirmation of transactions in 10 seconds Safe merged mining combining PoW with threshold-signature based federation Embedded low-delay fast relay backbone into peer-to-peer gossip network. Two-way pegging usingsidechainscurrentlyafederatedpeg, fullyautomaticpeg subject to Bitcoin improvements Acronyms“RSK”referstotheRootstocktheplat,relatedtermsare“RSKprotocol” the specification and“RSKreferencenode”thereferenceimplementation, thenative RSKcurrencyisthe“Rootcoin”,and“RTC”isthesymboloftheRootcoincurrency,“BTC” RSK White paper overview Page 6/24refers to the Bitcoin currency and “Bitcoin” refers to the Bitcoin protocol. Why Rootstock is important for the Bitcoin Ecosystem Alignment of Bitcoin Stakeholders and protection of value Rootstock governance s primary goal is to align the main stakeholders of Bitcoin by creating rewards that are fully aligned with their current activities. ThisphilosophyisdirectlyreflectedinitscorearchitecturewhereBitcoinminersprovide the hashing power required for the proof-of-work block validations, industry leaders Exchanges, Wallets and Payment Processors integrate the Federation that creates validation checkpoints and sign the redeem transactions of the 2-way peg. Ontopof that Rootstockdecidesimprovementstoitsplatbasedonavotingsystem whereMiners,IndustryLeaders,Bitcoin/Rootstockholdersandcoredeveloperstakethe final decision. In the following paragraphs we describe how this incentives play along. Governance model Eachplayerinthecommunityhastheknow-howtoservebestthecommunityexchanges andweb-wallets knowhowtoprotect Bitcoinsavings, minersknowhowtorealizelarge scale mining operations to secure user’s transactions, Blockhaincompanies innovatein newusecasesandmakesdreamscometrue,coredevelopershavethetechnicalexpertise to knownhowto tackle thetechnical challengestocome, nodemaintainersprovidethe infrastructureandnetworkconnectivity, andusersaretheheartofthesystem,providing trust and liquidity. Rootstockgovernancemodelaimstorepresentallactorsofthecommunity,byprovidinga boardofgovernanceconsistingin5seats. Minerswillbeabletovotewithhashingpower 1vote,BitcoinandRootstockuserswillvotewithproof-of-stake1vote,Exchangesand web-wallets will vote though the Federation 1 vote, Rootstock and Bitcoin Core developers will haveaspecial thresholdvotingsystem1vote, andthelast votewill be offeredtoanon-profitestablishedBitcoininstitution,suchastheBitcoinFoundation,that canrepresent the broader ecosystem. Also aninstitutional vote couldbe offeredtothe Ethereum Foundation, if it is representative of the Ethereum community. Protection of Bitcoin Miner s Investment InAugust 2016Bitcoinminingprofitabilitymarginwill fall tolessthan50duetothe decreasing block reward from 25 BTC to 12.5 BTC. Hundreds of millions of mining hardware will become instantaneously obsolete. This probably includes all mining machinesinthemarkettoday,sincetwogenerationsofchipsfasterandwithlowerpower consumptionwillbedevelopedandsoldbefore2017.Almostallcurrentminersthathave notreplacedtheirhardwarewillseetheendoftheirminingbusiness.Rootstock,thanksto itsmergedminingcapabilities,bringstheopportunitytotheseminerstokeeponbusiness RSK White paper overview Page 7/24at least four more years. Since Bitcoin merge-miners can mine both coins with zero marginal cost, minerswill still beabletomineBitcoinaslongastheadditional income provided by Rootstock mining compensates the profitability gap. Additionally the reduction in mining profitability by the Halving will create additional concentrationinthelowcost minerswhichwill increaseBitcoin snetworkvulnerability. Hence, RSKcouldalso play a key role inpromoting a broadbase of profitableminers increasing the security and value of Bitcoin. Alsobystartingtodayataminimumcost,andcreatingapplicationsforRootstocks,Bitcoin miners may not only protect their investment, but develop a whole new business opportunity. Securing the Bitcoin / Rootstock 2-way peg LeadingBitcoincompanieswillintegrateaFederationthatwillplaythefundamentalrole of securing the transfer of funds between the Bitcoin and Rootstock blockchains. In exchangeforthat theywill profit fromthefeesgeneratedbythesettlement betweenthe inflow and outflow of funds. Lower Bitcoin transactions fees and stable value asset issuing Current Bitcoin holders and prospective users have seen their usage of the monetary systemconfinedtocertainusecasesi.einvestment,globalpaymentnetworkmainlydue tobitcoinpricevolatilitybutthisconstraintmightworseninthefutureduetoapotential increase in transaction fees on the next Bitcoin halving. Rootstock brings a solutiontothisbyofferingalmost instant transactionvalidation20 seconds andasset issuing withprices peggedto that of a fiat currencyorotherstable commodity.Loweringvolatilityexposureintransactionswhilekeepingbitcoinasareserve currency increases overall bitcoin value. Bitcoin Security hardening Onthe next Bitcoinrewardhalving, hundredsof millionsondollarsinobsoletemining hardwarewillbesoldcheaplyprivatelyoronline.Thiswillopenawindowofvulnerability giving anattacker the possibility to buy ahugeamount of hashingpowerforverylittle money andcute a 51attack. Alsothedecreaseinsecuritymayaffect theperceived valueof thecoin.ByincreasingtheprofitabilityofBitcoinminingwithRootstockmerged mining, the Bitcoin network may prevent the hash rate to plummet. RSK White paper overview Page 8/24Rootstock as a lowcost BTC payment network IfBitcoinblocksizeisnotincreasedviaahard-fork,whenthenextBitcoinrewardhalves, Bitcointransactionfees may becomeprohibitivelyhighforcertainapplications. AsRSK blockscanholdmanymoretransactionsthanBitcoinblocks,Rootstockwillnaturallyoffer lower fees. See next section for an analysis of future scenarios regarding transaction fees. ThefutureofBitcoinanditstransactionsfeesisunclearcurrently,contentiousproposals onchangesinthemaximumblocksizewillhaveahighimpactinfuturetransactionfees.In thefollowingtableweattempt topredict futurescenariosandcompareRSKandBitcoin under reasonable assumptions on growth and forks. Parameter Bitcoin Rootstock Confirmation time with comparable security under Satoshi equivalence 10 minutes 10 seconds Minimum confirmation time for a reversal probability of 0.1 20 minutes 2 blocks 30 seconds 3 blocks Max. Transactions per second 3.3 tps assuming an average size tx 300 tps at launch Scalable to 1000 tps Current average cost for users for a standard transaction 6 cents Assuming 1.5 tps Market price not available Current cost for miners to include a standard transaction 1 cent Assuming Using the fast relay network UTXO in memory 1 ms processing time per tx. 25.2 BTC average block reward 5 cent Assuming Using standard relay network 1 cent estimated Assuming No RSK specific hardware switching. Almost no Rootstock transactions 1 cent estimated Interrupting a miner to load new header loses 10 ms of processing time Transaction fees by end of 2016 1.6 USD Assuming block size is not increased BTC/USD rate unchanged Same level of security 3 tps 1 cent estimated Assuming 3 tps Isimportant tonotefromtheabovechart that transactionfeesestimationsarebasedon theunprovenfact that theBTCpricewillremainatapproximately240BTC/USDduring 2016.Ifthepriceincreasesten-foldduringthisperiod,thenalsowillthetransactionfees, rendering Bitcoin Blockchain viable as an inter-banking clearing system, but not a payment network. Alsoisimportant tonotethat off-chainpaymentsystemscanemerge, providingcheaperpayments,butatthesametimecentralizingthenetwork,andchanging RSK White paper overview Page 9/24its decentralized nature. The following table shows possible future scenarios by the endof 2016, assuming that network hashing difficulty increases at the same ratio as BTC price Scenario Bitcoin cost of tx to miners Rootstock cost of tx to miners Bitcoin price increases 10 x 16 USD 2 cents TPS increases 10 x via hardfork 11 cents 0.2 cents BTC price and TPS increase 10 x 1.1 USD 2 cents AsthecostofincludingaBitcointransactionincreases,userswillswitchtoplatswith lower transaction costs, such as Rootstock. RSK White paper overview Page 10/24Rootstock Use Cases The Rootstock platprovides Turing-complete smart contracts as proposedbyNick Szaboin1993. At thesametime, RSK’sVMisbackwardcompatiblewithEthereumVM, henceRootstockgivestheopportunitytodevelopersworkingonEthereumtobenefitfrom the robustness of the Bitcoin Blockchain. Below we present a list of potential smart contracts and use cases that can be developed over RSK. Micropayment channels and Hub-and-Spoke networks Micropayment channels allowtwo parties to make secure regular lowvaluedpayments without paying fees for each payment, but only one time when the channel is closed. Hub-and-Spoke networks allow mutually untrusted users to make low-cost one time paymentsindirectlyusingpaymentchannelstoandfromathirdpartywithminimaltrust. TheRSKallowsHub-and-spokenetworkstobeimplementeddirectlywithminimalhassle and interfacing natively with standard e-wallets. Peer-to-peer distributed exchange Using TierNolan s protocol RSKsupports contracts that act as peer-to-peer exchanges. Automatic matchinginanorderbookcanalsobeeasilycreated. Thisallowsdistributed markets over independent block-chains, exchanging crypto-assets without third parties. Retail Payment Systems RSKallows BTCto beadoptedgloballyforevery-dayretail transactions. Oneof Bitcoin mainlimitationsforretailuseisitsconfirmationtimefrom10minutesto1hourtoensure irreversibility.RSKallowsconsumerstobenefitfromBitcoinsecuritywithconfirmations injust afewseconds.Merchantswillbeabletoacceptpaymentsinstantaneouslywithout requiring third party gateways. Another key element that any platshouldhave to succeedinthe retail market is to be able to support a largeamount of transactionper secondtps. TheRSKnetwork, usi