26 sats \ 3 replies \ @frostdragon 1 Aug 2022 \ on: Could Bitcoin eventually have a second layer for smart contracts paid in Sats? bitcoin
Technically there’s no Layer 2 “settlement” - there are transactions, but settlement happens on the base layer. That only works because of smart contracts. If you’re talking about NFT’s you’d have to make a change to the base layer, which should be avoided at all costs IMO.
There’s a BIP being discussed at the moment to expand smart contracts to the base layer at the moment. Last I checked that wasn’t looking very likely, but it might happen with more time.
Here’s a summary of it:
I wouldn't say that covenants fundamentally change the functionality of Bitcoin in terms of smart contracts. All they can do is place conditions on the spending of a UTXO. Bitcoin's "smart contracts" are not in the same category as Ethereum's: they are processed statelessly, there is no interaction between Bitcoin smart contracts. Even if Bitcoin script was replaced with a Turing complete language, these limitations still apply, and they keep Bitcoin safer and more decentralized. I don't see any layer 2 getting around these limitations, but sidechains might be able to, with the caveat of tradeoffs in the security.
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That's a very detailed reply. Thank you, will learn more about this. :)
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Don't want any changes to base layer. :)
But layer 2 solutions that allow us to bring decentralisation and freedom from centralized control would be cool.
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