Bitcoin's zero-knowledge future gets a test

Bitcoin currently lacks true layer-2 networks (as the term is used on Ethereum) primarily because existing scaling solutions do not inherit Bitcoin’s security model. Not really.*

Ethereum rollups that post transaction data to Ethereum mainnet directly leverage its security, ensuring that correct execution of transactions on these layers are secured by the same mechanisms protecting the base layer.

Bitcoin’s “layer-2” solutions, such as the Liquid Network and Rootstock (RSK), are technically sidechains. They operate independently of Bitcoin, using their own set of validators or miners. Sure, they may share mining hash rate, or checkpoint snapshots into Bitcoin, but it’s fundamentally a different level of security.

Innovations like BitVM can improve trust-minimized bridging from Bitcoin, but to enable bona fide layer-2 solutions on Bitcoin, protocol upgrades are necessary. These upgrades would introduce covenants — mechanisms that restrict how BTC can be spent — that enable secure, trust-minimized interoperability and allow Bitcoin to support a robust layer-2 infrastructure similar to Ethereum’s.

StarkWare described a significant milestone Wednesday in successfully verifying the first zero-knowledge proof using its new STARK verifier on Bitcoin’s test network, Signet. This achievement follows three months of research on the potential of OP_CAT, one such proposed Bitcoin upgrade.

StarkWare’s verifier, developed in collaboration with Weikeng Chen from venture firm L2 Iterative, is the first large-scale practical application of this opcode, StarkWare said in a statement. It demonstrates potential to underpin the development of zk-based layer-2 solutions for Bitcoin.

“This type of verification methodology is completely different from what’s already being explored by other scaling solutions on the Bitcoin network because it doesn’t require the use of fraud proofs or liveness,” the company said, adding that the code for the verifier has been published via Github.

Chen noted that the research was trailblazing. “We started with nothing. There’s no information about zk proofs on Bitcoin or the necessary mathematical operations. We had to build the full xstack leading to the STARK verifier’s implementation,” he said.

The new verifier employs Circle STARKs — cryptographic proofs which significantly speed up the proving process. They will also be used in StarkWare’s next-generation STARK prover, Stwo.

The current demo only verifies the solution to a discrete mathematical problem: the 32nd number in the Fibonacci squared sequence — or 21,783,092² — but the team plans to move on to demonstrate a wide range of computations that could ultimately form the basis of a virtual machine.

Until then, bitcoin holders who want to engage in DeFi can do so via a range of other approaches aimed at bringing BTC to other networks, each with their own trade-offs.

*Counterparty might quibble.

Get the news in your inbox. Explore Blockworks newsletters:

Blockworks Daily: The newsletter that helps thousands of investors understand crypto and the markets, by Byron Gilliam.
Empire: Start your morning with the top news and analysis to inform your day in crypto.
Forward Guidance: Reporting and analysis on the growing intersection of crypto and macroeconomics, policy and finance.
0xResearch: Alpha directly in your inbox. Market highlights, data, degen trade ideas, governance updates, token performance and more.
Lightspeed: Built for Solana investors, developers and community members. The latest from one of crypto’s hottest networks.
The Drop: For crypto collectors and traders, covering apps, games, memes and more.
Supply Shock: Tracking Bitcoin’s rise from internet plaything worth less than a penny to global phenomenon disrupting money as we know it.

Bitcoin’s zero-knowledge future gets a test

news