BIP-02-08-2024: Tailstorm Subnet for Bitcoin (BTC)

Status:

Draft

Type:

Standards Track

Created:

[02-08-2024]

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Summary

This proposal introduces a subnet on the Bitcoin (BTC) network leveraging the Tailstorm protocol to enhance transaction speeds while maintaining the SHA-256 hashing algorithm. This subnet aims to provide a secure and efficient on-chain solution, offering an alternative to the Lightning Network.

Background & Motivation

Bitcoin currently faces scalability issues, often relying on the Lightning Network for off-chain transactions. However, off-chain solutions come with their own set of challenges. The Tailstorm protocol, utilizing parallel proof-of-work consensus and a DAG-style structure, enhances transaction throughput and reduces confirmation times without sacrificing security oai_citation:1,Tailstorm: A Secure and Fair Blockchain for Cash Transactions oai_citation:2,Tailstorm: A Secure and Fair Blockchain for Cash Transactions | Papers With Code.

Deployment

Deployment of this specification does not require network coordination. Sufficient deployment, as per the payee's risk profile, is required before Tailstorm-secured transactions can be safely accepted as final.

Specification

1. Integration of Tailstorm Protocol:

   • Implement the Tailstorm protocol to support high transaction throughput using a Directed Acyclic Graph (DAG) structure.
   • Optimize for low latency, achieving transaction confirmation times within seconds.

2. Retain SHA-256 Hashing Algorithm:

   • Maintain the use of SHA-256 for compatibility with existing Bitcoin mining hardware and to ensure network security.

3. Subnet Development:

   • Develop a dedicated subnet within the Bitcoin network for running Tailstorm.
   • Implement interoperability mechanisms for smooth transaction transfers between the Bitcoin mainnet and the Tailstorm subnet.

4. Testing and Deployment:

   • Utilize a simulation framework to test the Tailstorm implementation under various conditions.
   • Conduct extensive testing followed by a phased rollout to the Bitcoin community.

Benefits

1. Faster Transactions: Near-instant transaction confirmation times.
2. Enhanced Security: Reduced risk of double-spending compared to current methods.
3. Compatibility: Continued use of SHA-256 ensures compatibility with existing Bitcoin infrastructure.

Costs & Risk Mitigation

1. Increased Transaction Sizes: Slight increase in transaction size due to additional Tailstorm data.
2. Modification to Transaction Acceptance/Relay: Changes to transaction relay policies might affect existing transaction users.
3. Node Implementation Complexity: Specialized transaction relay and mining policies might increase the cost and complexity of node implementations.

Reference Implementation

Source Code

```python

Tailstorm Network Simulation

import networkx as nx import matplotlib.pyplot as plt

Create a directed graph

G = nx.DiGraph()

Add nodes

G.add_nodes_from([1, 2, 3, 4, 5])

Add edges

G.add_edges_from([(1, 2), (2, 3), (3, 4), (4, 5), (2, 5)])

Draw the graph

nx.draw(G, with_labels=True) plt.show() ```

Directory Structure

btc-tailstorm-subnet/ │ ├── src/ │ └── tailstorm.py │ ├── docs/ │ └── README.md │ ├── tests/ │ └── test_tailstorm.py │ └── requirements.txt

Installation

bash git clone https://github.com/your-repo/btc-tailstorm-subnet.git cd btc-tailstorm-subnet pip install -r requirements.txt

Usage

Run the simulation framework:

bash python -m src.tailstorm

Analyze attack success rates:

bash python -m tests.test_tailstorm

References

1. Tailstorm: A Secure and Fair Blockchain for Cash Transactions
2. Tailstorm: A Secure and Fair Blockchain for Cash Transactions - Dagstuhl
3. Bitcoin Improvement Proposals (BIPs) Repository
4. Parallel Proof-of-Work with DAG-Style Voting and Targeted Reward

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The current implementation of lightening network is not only complicated but it can lead to centralization this alternative solution solves the issue of transaction speed without compromising the final settlement transaction guarantee of 6 confirmations it help merchant accept the transaction faster while waiting for the final settlement at The mainnet however it doesn't help with the high transaction fees issue this is an excellent solution for moderate value transaction where both strong final settlement guarantees needed and transaction speed

This BIP aims to guide the development and deployment of the Tailstorm subnet, enhancing the Bitcoin network's efficiency and security. Community feedback and participation is important for the success of the idea we as collective community secure the network and we need careful thinking and technical discussions before any implementation the side effect of taproot activations made unexpected outcomes.