Technical Overview
Last updated
Last updated
The Bitcoin Inscribed Trustless Execution Standard (BITE) describes a safer and simpler way to run applications that want to settle on Bitcoin but require more complex logic than simple user transfers. BITE uses a suite of advanced cryptography features -- namely, ZKPs, PSBTs, Schnorr signatures, tap-scripts, and Distributed Key Generation MultiParty Computations networks -- to verify each complex process step without needing to trust the counter-party or delegate the verification effort to a decentralised blockchain. All the settlements happen directly on-chain, and the balances never cede control to parties outside the Bitcoin network. The computations are verified locally, and the processes are computed in a distributed fashion, making it more secure and less error-prone than alternatives.
Put differently, BITE is a cryptographically secure extension of ’bitcoin script’ that requires no forking. This paper aims to provide the foundations for how this protocol could be implemented and scaled.
BITE is a meta-protocol like Ordinals or Runes and aims to extend Bitcoin's functionality without having to hard fork the network. It inherits all of Bitcoin's security, trustlessness, and decentralisation.
BITE is completely stateless and does not hold any data that can compromise the network's security.
A high-level breakdown of the protocol is presented in the image above, which can be broken down into four core parts:
Vaults is the name given to the tap-script that initiates a loan-creating event. They include three spending functions:
Mint - unlocks some Rune Tokens in exchange for locking some BTC.
Redeem - Unlocks the BTC held as collateral in exchange for burning some runes.
Liquidate - Makes the Locked BTC spendable by the Multiparty Computation network.
Distribute the network computation amongst all the nodes without storing any state. The network is set up to allow dynamic membership so users can drop in and out of the computations without affecting the outcome. The network only holds the code to pull information from the BTC chain, not the actual execution code, so all code is stored on BTC but computed locally.
The code executed by the network is in the form of zero-knowledge circuits stored on-chain as ordinal Inscriptions. This code is pulled from the chain into the nodes and executed locally. ZKs boasts a property called "Incremental Verifiable Computation," which allows third parties to verify that a given piece of code has been executed according to a specific standard called a circuit without running the code themselves with a fraction of the computational overhead, following the principle of hard to prove easy to verify.
The protocol participant will listen to any Bitcoin price updates through a connection to a decentralised Oracle system, specifically Chainlink.
