Types of protocols that may support Bitcoin scaling

This page is currently under development.

We have seen the following protocols being used to scale Bitcoin.

  • Federations: Custodial protocols (e.g. Fedimint) or blockchains operated by permissioned federation members (e.g. Liquid)

  • State channels: Multi-signature contracts where parties can perform transactions while the channel is open

  • Sidechains: Permissionless consensus protocols (blockchains) that exist to provide more functionality to BTC the asset, or are merge-mined with Bitcoin, or do both.

    • Sidechain rollups: Rollups that use sidechains for DA and additionally receive settlement assurances from sidechain consensus

  • Validiums or Optimiums: Blockchains that post DA somewhere but have a trustless BTC bridge.

    • This is not currently possible. Blockchains may be pseudo-validiums (or optimiums) if they have a BitVM bridge program, but no implementation of this is currently live.

  • Rollups: Blockchains that post DA to Bitcoin (and have a trustless BTC bridge)

    • Rollups can have trust-minimized validating bridges (that may also validate ZK-proofs) with something like a BitVM bridge program. No implementations of this are currently live. The requirement for being a rollup is using Bitcoin as the DA layer.

  • Other: Client side validation protocols, Taproot assets, L3s

Notes

  • We classify rollups that settle to other blockchains that are not merge-mined, or don't use Bitcoin for data availability, as sidechains.

  • Alternative Layer 1 blockchains are not sidechains because they do not exist to scale Bitcoin.

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