Author Topic: The Bitshares blockchain as the first public sidechain for Bitcoin  (Read 22558 times)

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Offline JonnyB

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Obviously we should be pushing to get a sidechain implementation going ASAP.  But I think we're dramatically overcomplicating it in this thread and should probably leave the precise details to the devs (primarily @bytemaster). 

Beyond that, I think we should be concentrating on pushing to incentivize a) creation of the primary fiat BitAssets and b) participation in BitAsset liquidity pools, among other liquidity measures. 

Speaking of liquidity, I think we should be doing what we can to establish robust markets in any new cryptocurrencies that hit the market.  The Lisk ICO will go for another 3 weeks and then it will launch and trade on the open market.  I'll probably say this until I'm blue in the face.  But we should make sure we are among the first exchanges (if not THE first) to trade Lisk.  That would generate plenty of buzz and new users for the DEX.

We really need to get serious about making some of these pieces of the puzzle come together.

@bytemaster solution is just a bitcoin master wallet where the witnesses share the private keys and issue IOU tokens much like OPEN.BTC minus the multisig

Can we keep on topic with this thread. Please start a new thread if you want to discuss adding lisk.
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Offline Frodo

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Edit: Thinking about it more the SIDEBTC shouldn't require a key held by the depositor or SIDEBTC loses fungibility. Since SIDEBTC can only exist on the BitShares chain there is no reason to have anyone but the witnesses (aka the Graphene engine) able to spend it 1:1 for real BTC.
Correct. This is the point.

 +5%
I just wonder how it would be possible to maintain a witness multisig address with witnesses getting voted in and out.

Offline tbone

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Obviously we should be pushing to get a sidechain implementation going ASAP.  But I think we're dramatically overcomplicating it in this thread and should probably leave the precise details to the devs (primarily @bytemaster). 

Beyond that, I think we should be concentrating on pushing to incentivize a) creation of the primary fiat BitAssets and b) participation in BitAsset liquidity pools, among other liquidity measures. 

Speaking of liquidity, I think we should be doing what we can to establish robust markets in any new cryptocurrencies that hit the market.  The Lisk ICO will go for another 3 weeks and then it will launch and trade on the open market.  I'll probably say this until I'm blue in the face.  But we should make sure we are among the first exchanges (if not THE first) to trade Lisk.  That would generate plenty of buzz and new users for the DEX.

We really need to get serious about making some of these pieces of the puzzle come together.

Offline JonnyB

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In this case, only those that provide real BTC will be able to withdraw real BTC ..
That's a non-starter IMHO and I would personally prefer a big multisig scheme instead ..

Correct. But this would create the liquidity and the low costs that would allow for a shapeshift style bridge from BITBTC to realBTC.

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Offline xeroc

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In this case, only those that provide real BTC will be able to withdraw real BTC ..
That's a non-starter IMHO and I would personally prefer a big multisig scheme instead ..

Offline JonnyB

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@abit
* The witness who hold the second key could be killed, so the key lost, and the locked BTC become non-redeemable, hence no value.
* The witness who hold the second key could be the same person who deposited the BTC which is supposed to be locked, but actually the person have both keys, she can just unlock the fund without destroy the issued bitBTC.

1 all witnesses would hold the second key
2 the software will only allow a witness to sign the bitcoin transaction once the corresponding SIDEBTC has been destroyed. Remember SIDEBTC is not transferable only BITBTC is.
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Offline tbone

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I can't see a need for BitBTC in this scenario.  Unless I'm missing something, the whole point of a BTC sidechain is that it effectively allows real BTC to be traded on the DEX.  Of course, mechanically, that means trading a BTC asset (e.g. SIDE.BTC) that is backed 1-1 by real BTC held in a multi-sig BTC wallet or some other sidechain construct.  But the point is, I think this makes BitBTC unnecessary.  In fact, theoretically this could be duplicated for any blockchain-based asset such that the need for all the complications associated with market pegging will ONLY be required for "real world" assets such as fiat currencies (e.g. USD, CNY, EUR), commodities (e.g. Gold, Silver, Oil), stocks (e.g. AAPL, MSFT), etc.  Where am I going wrong here?

Offline abit

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How to solve these problem:
* The witness who hold the second key could be killed, so the key lost, and the locked BTC become non-redeemable, hence no value.
* The witness who hold the second key could be the same person who deposited the BTC which is supposed to be locked, but actually the person have both keys, she can just unlock the fund without destroy the issued bitBTC.

The real solution should be like: the person who deposited fund to BTS network SHOULD abandon any control of the fund totally, since the BTS network already issued her same amount of token for example bitBTC, she can transfer the bitBTC to others. Then the fund can be and can only be redeemed by anyone who hold same amount of bitBTC.


Thoughts?


//Update:
Edit: Thinking about it more the SIDEBTC shouldn't require a key held by the depositor or SIDEBTC loses fungibility. Since SIDEBTC can only exist on the BitShares chain there is no reason to have anyone but the witnesses (aka the Graphene engine) able to spend it 1:1 for real BTC.
Correct. This is the point.
« Last Edit: March 02, 2016, 01:13:24 pm by abit »
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Offline noisy

For reference: (with that link I will have less work next time, when I will need to find something what was already discussed about that topic)

This topic was already touched on the forum, however earlier we were not sure is it possible to do this:
- Is it possible for bitshares to become a sidechain of bitcoin?
- Graphene: Data security and verification on the chain

and we also got interesting input from Eric Martindale from Blockstream
Quote
Hey guys, Eric Martindale with Blockstream here.  The answer to your question is absolutely, yes!  It is definitely possible, and it would be very exciting to see BitShares as a sidechain.  If I recall correctly, there are many other related projects that would make equal sense as sidechains, too.

However, choosing to migrate from the existing model to a bonded sidechain is a different question.  While sidechains already exist in the wild (see the alpha sidechain if you're looking for something to prototype on top of), creating and configuring one isn't trivial (yet).  As part of the Elements Project, we're hoping to make this easier, but migrating any existing project to a sidechain will incur some amount of technical work.  In the case of BitShares, I would expect it to be significant – you'll want to make sure the benefits are worth the effort.

I'd be excited to have a conversation with Daniel or someone else from the BitShares team if they express any interest at all in pursuing this idea.  Obviously, I'm excited about it, because I think there is very clear value in doing so, but I'd want to make sure that sentiment is shared among those responsible for BitShares.

I, for one, think a world full of many interoperable blockchains is an exciting one!

Sidechains were also discussed during one of hangout with bytemaster. Could anyone help me find a link?
« Last Edit: March 02, 2016, 01:11:34 pm by noisy »
Take a look on: https://bitsharestalk.org/index.php/topic,19625.msg251894.html - I have a crazy idea - lets convince cryptonomex developers to use livecoding.tv

Offline sudo

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how to control btc address  decentralized?
can Intelligent contract run a robot?
receive  btc ---send sidebtc
receive sidebtc--send real btc
make profit  send to shareholders
no risk

Offline Riverhead




Beautiful. My only objection is with the 110% collateral requirement. What is the harm in SIDEBTC never being redeemed for BTC? The bitBTC would live forever collateralized with SIDEBTC. Since it's a 1:1 pairing there is never a chance of the two being worth different amounts and therefore would never have a need to be called. If the borrower lost the private keys to their signing account on the collateral then the bitBTC would be indestructible. They wouldn't be able to exit that position to unfreeze their BTC but since bitBTC is fungible they'd just need some bitBTC to unlock the same amount of real BTC. Sure the SIDEBTC would exist forever with the real BTC locked up forever but there's no harm in that. People lose private keys all the time - who knows how much actual BTC is unspendable.


Edit: Thinking about it more the SIDEBTC shouldn't require a key held by the depositor or SIDEBTC loses fungibility. Since SIDEBTC can only exist on the BitShares chain there is no reason to have anyone but the witnesses (aka the Graphene engine) able to spend it 1:1 for real BTC.
« Last Edit: March 02, 2016, 12:53:45 pm by Riverhead »

Offline noisy

I said it before and I will say it again, sidechain should be our top priority! :)

...
But to make sure almost all SIDEBTC is redeemed in the future we should make the collateral requirements for BITBTC higher than 100%
For example we could require 110% SIDEBTC in collateral to create 100% BITBTC
...

I am wondering how can we actually avoid requirenments for those additionall 10% of collateral.

Imagine that I have 1 SIDEBTC used as collateral to create exactly 1 bitBTC.


When I sell 0.8 bitBTC I need to:
- provide a public key, which wll be used to generate new multisig address
- sign 2 multisig transactions:
  - with 0.8 bitBTC, from my address A to new owner
  - with "0.2 bitBTC - bitcoin fee", from my address A to my new multisig address B

In that case I will have to prove that I have an access to my own bitcoins every time when I want to take something from my original collateral.

The downside: I am not sure... but is that will mean, that I will have to wait on average 10 minutes to fullfil an BTC order on the DEX?
Take a look on: https://bitsharestalk.org/index.php/topic,19625.msg251894.html - I have a crazy idea - lets convince cryptonomex developers to use livecoding.tv

Offline sudo

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krondix

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This is a killer feature from a lot of perspectives.

Offline Zapply

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