From 941f2891f308c949eb1ee6e1c6cd0b435ba6f426 Mon Sep 17 00:00:00 2001 From: M Glasgow Date: Fri, 12 Apr 2024 16:00:21 +0100 Subject: [PATCH] sidechain constructions --- docs/uses/sidechains/sigma-chains.md | 48 ++++++++++++++++++++++++++-- 1 file changed, 45 insertions(+), 3 deletions(-) diff --git a/docs/uses/sidechains/sigma-chains.md b/docs/uses/sidechains/sigma-chains.md index f82d8d2..d6dac06 100644 --- a/docs/uses/sidechains/sigma-chains.md +++ b/docs/uses/sidechains/sigma-chains.md @@ -9,6 +9,20 @@ tags: Sigma Chains represent a groundbreaking innovation designed to revitalize Proof of Work (PoW) and solidify Ergo's position as the king of chains. By introducing programmability, cross-chain compatibility, and economic sustainability, Sigma Chains unlock a multitude of possibilities for Ergo and its ecosystem. +## What are Sigma Chains? + +Sigma Chains represent a universe of programmable money, offering a groundbreaking solution for the Proof of Work (PoW) and UTXO-based blockchain ecosystem. They are a series of blockchains that share the same contractual base layer, while allowing for different chain-specific features and customization. + +The Sigma Chain standard has already proven its success in the PoW and UTXO setting, with Ergo currently ranking as the #1 PoW blockchain in terms of Total Value Locked (TVL) relative to its market capitalization. This achievement showcases the immense potential and demand for programmable money within the PoW ecosystem. + +Beyond serving as a powerful contractual base layer, Sigma Chains are designed to operate as a cross-chain standard, enabling seamless interoperability and trust-minimized communication between different blockchains. This cross-chain capability opens up a wide range of possibilities, such as asset transfers, liquidity sharing, and the execution of complex smart contracts across multiple chains. + +In essence, Sigma Chains present a compelling alternative to the Ethereum Virtual Machine (EVM) for Proof of Work and UTXO-based blockchains. While the EVM has been the dominant smart contract platform for Proof of Stake (PoS) networks, Sigma Chains aim to fill this gap for PoW and UTXO-based systems, providing a robust and flexible framework for building decentralized applications (DApps) and enabling programmable money. + +Moreover, Sigma Chains go beyond the capabilities of the EVM by incorporating a trust-minimized cross-chain framework. This framework allows for secure and efficient communication between different Sigma Chains, as well as other compatible blockchains, without relying on centralized intermediaries or compromising the security and integrity of the individual chains. + +The trust-minimized cross-chain framework of Sigma Chains is achieved through the use of advanced cryptographic techniques, such as zero-knowledge proofs and threshold signatures. These techniques enable the verification of cross-chain transactions and the enforcement of cross-chain consensus rules, ensuring that assets can be securely transferred and smart contracts can be executed across different chains without introducing additional trust assumptions. + ## Ergo at the Center of Sigma Chains Sigma Chains are built upon the robust foundation of Ergo, leveraging its advanced features and technologies to create a thriving network of interconnected blockchains. Here's how Sigma Chains benefit Ergo and its holders: @@ -66,9 +80,37 @@ Sigma Chains introduce a novel approach to token distribution through smart cont - **Rewarding Investors:** Protocol-based emissions will be structured in new Sigma Chains to reward early investors, providing them with a stake not just in a single ecosystem but in the entire Sigma standard. This creates a seed allocation across new chains and future potential raises. - **Supporting Development and Growth:** Smart contract emissions can also be used to build treasuries for development, community initiatives, and marketing efforts. By allocating resources transparently and efficiently, Sigma Chains ensure the long-term sustainability and growth of the ecosystem. +## Sidechain Constructions + +Sigma Chains offer various efficient sidechain constructions that cater to different use cases and mining preferences. These constructions include merged-mined sidechains, double merged-mined sidechains, and dedicated mining algorithms for specific hardware types. + +### Merged-Mined Sidechains + +Merged-mined sidechains allow Ergo miners to simultaneously mine both the Ergo mainchain and the sidechains. This approach is often simpler than other Layer-2 scaling solutions, as it provides efficient and trustless cross-chain interoperability. With merged-mined sidechains, scaling applications can be built directly on top of Ergo, leveraging its security and functionality. + +One significant advantage of merged-mined sidechains in the Ergo ecosystem is the possibility of trustless two-way pegging. This is achievable because smart contracts on the Ergo mainchain can read sidechain data written on the blockchain, including commitments to the sidechain UTXO set. Unlike Bitcoin, where the Merkle tree of sidechain block transactions cannot be used in contracts, Ergo's smart contract capabilities enable seamless and secure pegging between the mainchain and sidechains. + +In a merged-mined sidechain setup, the pegging security is equivalent to the security of the sidechain itself. This means that the sidechain benefits from the combined mining power of both the mainchain and the sidechain miners, providing a robust and resilient security model. + +### Double Merged-Mined Sidechains + +Double merged-mined sidechains offer an innovative approach to bridging Ergo with other PoW blockchains, such as Bitcoin, while minimizing trust requirements. This construction allows for the enrichment of contractually limited blockchains by leveraging Ergo's advanced smart contract capabilities. + +One example of a double merged-mined sidechain is the RGB++ proposal from Nervos/CKB. In this setup, a Sigma Chain acts as a Bitcoin sidechain, but unlike traditional sidechains, it includes commitments to both the Bitcoin and the sidechain UTXO sets written on the blockchain. This enables the execution of rich applications directly on the Bitcoin blockchain, with Bitcoin transactions submitted to the Bitcoin blockchain and auxiliary data submitted on the sidechain instead of off-chain. + +Double merged-mined sidechains provide sidechain security in a merged-mine setting. They also enable the coexistence of Bitcoin and Ergo UTXO sets on the same blockchain, where some blocks are merged-mined with Bitcoin and others with Ergo. This construction facilitates the creation of bridges between Bitcoin and Ergo with reduced trust requirements. + +### Dedicated Mining Algorithms + +Sigma Chains also support dedicated mining algorithms, allowing for the creation of sidechains tailored to specific hardware types. These sidechains feature a dedicated PoW consensus mechanism alongside the Sigma contractual layer and additional chain-specific features. + +With the inclusion of Autokoyos2 verification and built-in support for Ergo headers (already available in the Sigma protocol), trustless replay protection can be implemented through on-chain contracts. This enables the creation of SPV (Simplified Payment Verification) clients for sidechains. + +Furthermore, sidechains with dedicated mining algorithms can utilize relay contracts to incentivize mainchain miners for submitting proper sidechain data on the mainchain. The sidechain's emission contract rewards mainchain miners in sidechain tokens for their contributions. This approach provides a clearer and more secure incentive mechanism compared to the BIP-301 proposal. + +Ergo miners can submit sidechain data efficiently by running SPV clients for the sidechains, avoiding the need for full data validation. This addresses the main concern raised in BIP-301, as miners can submit SPV data for different sidechains and receive rewards from the emission contracts without the burden of full verification. -## Conclusion +The flexibility of dedicated mining algorithms in Sigma Chains opens up new possibilities for tailored sidechains. For example, as Ergo's mining landscape evolves and certain hardware becomes less profitable (e.g., 4GB GPUs), dedicated sidechains can be created to support these specific hardware types, ensuring their continued viability and participation in the ecosystem. -Sigma Chains represent a significant leap forward for Ergo and the broader blockchain ecosystem. By empowering Ergo as the king of chains, Sigma Chains create new opportunities for miners, developers, and users alike. With increased demand for ERG, expanded collateral opportunities, and a thriving ecosystem of portable projects, Ergo is poised to lead the charge in the era of programmable PoW. +In conclusion, the various sidechain constructions available in Sigma Chains, including merged-mined sidechains, double merged-mined sidechains, and dedicated mining algorithms, offer a wide range of options for scaling, interoperability, and hardware-specific optimizations. These constructions showcase the versatility and adaptability of the Sigma Chain framework, enabling developers and miners to choose the most suitable approach for their needs while leveraging the security and functionality of the Ergo ecosystem. -As Sigma Chains gain momentum, Ergo will solidify its position as a key player in the blockchain space, driving innovation and adoption across all hardware classes. The future of Proof of Work is bright, and Ergo, with its Sigma Chains, is at the forefront of this transformation. \ No newline at end of file