A group of developers has discovered the possibility of enabling covenants on Bitcoin without altering its base code.
On November 7, a team of developers published a new paper announcing a breakthrough that could change how Bitcoin operates. The main novelty is the ability to activate covenants without needing to modify its base code through a soft fork.
The research, titled “ColliderScript: Covenants in Bitcoin via 160-bit hash collisions,” was conducted by a team including Ethan Heilman, one of the authors of the OP_CAT proposal, Victor Kobolov and Avihu Levy, developers of the StarkWare project, and Andrew Poelstra, Head of Research at Blockstream.
The paper introduces the following:
“Until recently, it was believed that implementing covenants on Bitcoin would require a soft fork of an additional opcode, such as dedicated ones like OP_CTV or indirect ones like OP_CAT. In this paper, we show that covenants may already be feasible on Bitcoin today without any soft fork. While our solution is computationally intensive, we believe there’s significant room for optimization.”
Covenants are restrictions placed on how Bitcoin UTXOs can be spent, which would enable:
- Development of advanced deposit systems (Vaults)
- Improved network scalability
Last September, Peter Todd, a Bitcoin developer, published a paper analyzing in detail all the covenant proposals currently under discussion.
Some covenant proposals would enable new, more complex functionalities similar to those found in Ethereum, while maintaining the high level of security that characterizes the Bitcoin protocol.
Although the proposed solution is promising, it still requires several optimizations. For instance, one limitation is the still very high computational cost. According to Robin Linus, BitVM developer, the basic idea is “ingenious” and could pave the way for further research and optimizations.
