Bcoin Hackathon — Starting a new wave of Bitcoin innovation
At the weekend Michael Folkson and Nathan Basanese participated in the Bcoin hackathon at HackReactor in San Francisco. Read this excellent Steven McKie write up here.
We worked on a project with Alex Bosworth (BitGo) which after much discussion on how we thought Bitcoin will evolve and the challenges it would encounter in the next few years we named it “Monetizing Full Nodes”. As many will understand, the decentralization of the network depends on as many people running full nodes as possible but there is a real monetary cost to doing so. We wanted to explore how lightning transactions could facilitate the generation of revenue to at least fund the running costs of full nodes (if not generate profits for the owner).
There were two really interesting technologies that we experimented with during the weekend: Bcoin and Lightning.
Bcoin
Bcoin has been built by Chris Jeffrey (JJ) who is CTO at Purse. Bcoin is an alternative full node implementation to Bitcoin Core. Satoshi famously said an alternative implementation would be a “menace to the network”. It is built in Javascript which makes it accessible to many more developers than C++. Arguably, its most attractive feature is its modularity that allows developers to make changes to a specific component (e.g. wallet, mempool) without needing to make changes to the various other components.
At worst, Bcoin will be a great educational tool for allowing Javascript developers to understand the different components of Bitcoin for the first time. At best, it brings valuable diversity to the Bitcoin ecosystem. Bcoin may eventually be relied upon as an alternative in the case of a failure within the Core implementation in the same way as Ethereum miners can switch between Geth and Parity.
This is the Let’s Talk Bitcoin episode with JJ that acts as a great introduction to Bcoin and what it is attempting to achieve.
Or check out the code here:
Lightning
The Lightning network is a project that the whole Bitcoin ecosystem seems to be pinning its hopes on for Bitcoin scaling off-chain. It is still early for Lightning but Alex and Nathan entered into a Lightning transaction using Olaoluwa Osuntokun’s (“Roasbeef”) lightning node on a private simnet and we filmed it during the hackathon.
With Bitcoin transaction fees hitting record highs, many business use cases on-chain are no longer feasible. Lightning offers the potential for cheaper (or possibly even free) instant transactions. It also offers full nodes the opportunity to generate some fees by becoming a lightning node and routing payments through the lightning network.
During the hackathon we explored additional opportunities for monetizing a full node for which lightning would also be a prerequisite (assuming current on-chain transaction fees). If you are familiar with oracles e.g. moderators on OpenBazaar and RiskBazaar or Rep token holders on Augur, you will appreciate that multi-signature escrow transactions on Bitcoin and smart contracts on Ethereum both require the supply of information to settle. (Check out Oraclize if you are interested in how this information can be supplied with a proof of authenticity). The demo that we presented at the hackathon illustrated how a user could pay a lightning node for information on the state of the Bitcoin blockchain using the lightning network.
RiskBazaar
As always we were playing around with RiskBazaar before and during the hackathon.
I entered into a wager with Alexandra that we’d win the hackathon a couple of weeks in advance.
However, once there and we spoke to the participants, we were less confident and I entered into a wager that the team of kids (highschoolers Arjun, Ishan and Rishi) would win.
Our proof-of-concept demo requested information from the lightning node on whether the first prize (1BTC) had been sent to the highschoolers’ Bitcoin address. This information could be used to assess whether Michael (michael) or Nathan (v6) should receive the payout from the above risk contract. In return for this information, the demo paid a small fee to the lightning node using the lightning protocol.
Unfortunately, the highschoolers didn’t win this time but look out for these guys. Their enthusiasm was infectious and they are just the sort of guys that Bcoin hopes to attract into the Bitcoin ecosystem.
Thanks to the organizers (Buck Perley, Dylan Tran, Steven McKie) and the sponsors (Purse, Hack Reactor, Gen Life, Ledger, Andreas Antonopoulos) for providing a great space and great prizes. Hopefully see you at the next one!
