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Blockstream's Neigut Expects ‘Cambrian Explosion’ of Bitcoin Layer 2 Protocolswww.coindesk.com/tech/2023/05/03/blockstream-developer-neigut-expects-cambrian-explosion-of-bitcoin-layer-2-protocols/
451 sats \ 10 comments \ @Futru 3 May 2023 bitcoin
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100 sats \ 9 replies \ @om 3 May 2023
This needs a write-up from somebody who doesn't call WBTC (which is just an IOU from BitGo) a L2. Also mints are more L3 than L2 since they sit on top of LN.
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10 sats \ 6 replies \ @lightcoin 3 May 2023
mints don't really sit on top of LN, anymore than Kraken or River "sit on top of LN" just because their users can deposit/withdraw via LN
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0 sats \ 5 replies \ @om 3 May 2023
I would say that if a user of Kraken could send a payment to a user of River and it would go through LN, then Kraken and River "sit on top of LN". The support for atomic swaps with LN is built into Fedimint so I'd say that counts.
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10 sats \ 4 replies \ @lightcoin 3 May 2023
Yes, a Kraken user can pay a River user through LN and vice versa afaik. But they could do the same with L1 BTC too. Does that also mean Kraken and River "sit on top of bitcoin L1" and are therefore L2s?
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0 sats \ 3 replies \ @om 3 May 2023
Let's say the code for Lx can call into Ly code if x > y, so in your example L3 code calls L1.
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0 sats \ 2 replies \ @lightcoin 3 May 2023
I don't follow. Are you saying Kraken and River are L3s? I'm mostly confused because you objected to calling WBTC L2 but seem to be making an exception for a different custodial system (mints, and now maybe CEXes as well?)
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69 sats \ 1 reply \ @om 3 May 2023
As I have written in the reply to niftynei, "In my mind what makes a layer is the number of participating entities". So yes, if Kraken, River and some other exchanges allow users to pay each other via LN, then I'd say they form an L3.
I object to calling WBTC L2 because there's only one BitGo, but if there would be 100 different custodians I'd say they form an L2.
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100 sats \ 0 replies \ @lightcoin 3 May 2023
Ok. I don't consider the number of trusted third parties involved to be what distinguishes between what is and isn't a distinct "layer" on bitcoin but to each their own!
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0 sats \ 1 reply \ @niftynei 3 May 2023
I listed WBTC as an L2 in my talk, which is where the confusion comes from; I give the definition of an L2 that I’m using in the talk I did at MIT the weekend before, notes here: https://gist.github.com/niftynei/5f9373568e2cf6d15db6c7546a43f763
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0 sats \ 0 replies \ @om 3 May 2023
I'll quote your definition here:
  • a layer-2 is a separate accounting system where the authorization to execute a transaction must be granted by the holder of the account primitive in other words, you can't make a valid transaction on a layer-2 without a valid signature of the party that owns the layer-2 asset. in this sense, coinbase's database would NOT be a layer-2, since anyone who works at coinbase can validly update their database
My problem here is that I think that both WBTC and Cashu are not that different from Coinbase for the purpose of this definition. BitGo could in principle freeze your WBTC, refuse to honor their IOU to you and mint the same amount to someone else, effectively making a transfer. A Cashu minter could refuse to reissue ecash tokens if the request comes from a specific IP - again, the tokens could then be reissued to somebody else. I don't think that these scenarios are significantly more far-fetched than a Coinbase employee tinkering with their database.
In my mind what makes a layer is the number of participating entities. If there would be 100 instances of Stacker News, and they would be all connected through LN, they would form a L3.
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