How To Save Fees in Bitcoin Smart Contracts: a Simple Optimistic Off-chain Protocol

• URL: http://arxiv.org/abs/2403.09880v3
• Date: Thu, 24 Oct 2024 09:21:09 GMT
• Title: How To Save Fees in Bitcoin Smart Contracts: a Simple Optimistic Off-chain Protocol
• Authors: Dario Maddaloni, Riccardo Marchesin, Roberto Zunino,
• Abstract summary: We consider the execution of smart contracts on Bitcoin. We introduce a protocol that moves most of the execution of a Bitcoin contract off-chain.
• Score: 0.40964539027092906
• License:
• Abstract: We consider the execution of smart contracts on Bitcoin. There, every contract step corresponds to appending to the blockchain a new transaction that spends the output representing the old contract state, creating a new one for the updated state. This standard procedure requires the contract participants to pay transaction fees for every execution step. In this paper, we introduce a protocol that moves most of the execution of a Bitcoin contract off-chain. When all participants follow this protocol, they are able to save on transaction fees, drastically reducing them. By contrast, whenever adversaries try to disrupt the off-chain execution, any honest participant is still able to enforce the correct contract behaviour, by continuing its execution on-chain.

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