Bitcoin Amsterdam Spotlights Obstacles to Proposed Enhancements

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The continuous evolution of the Bitcoin protocol has remained a subject of intense debate within the ecosystem, as exemplified by historic events such as the block size dispute in 2017.

Bitcoin’s core developers have long been embroiled in contentious discussions regarding Bitcoin Improvement Proposals (BIPs) aimed at addressing protocol challenges, as evidenced by a heated panel debate at the Bitcoin Amsterdam event in 2023.

Esteemed Bitcoin developers Paul Sztorc and Peter Todd brought this discord to the forefront in Amsterdam, with Todd expressing strong criticism of Sztorc’s contributions to the ongoing development of Drivechains.

Sztorc’s LayerTwo Labs has dedicated nearly six years to the development of BIP-300, advocating for the creation of layer-2 sidechains capable of resolving various issues without necessitating fundamental changes to the Bitcoin protocol.

The ensuing debate, marked by occasional heated exchanges and Todd speaking over Sztorc, underscored the challenges of reaching a consensus on BIPs designed to enhance the overall functionality of the Bitcoin protocol.

Jameson Lopp, co-founder and Chief Technology Officer of Bitcoin custody firm Casa, weighed in on this issue during an extensive interview with Cointelegraph at the conference. He expressed his concern that the pace of improvements and protocol modifications has slowed more than he would prefer.

However, recent weeks have witnessed some changes with the emergence of new projects like BitVM and SpiderChain, as Lopp pointed out.

He believes that a couple of proposed soft forks could potentially benefit the future of the protocol:

“In general, I believe that Bitcoin should integrate features that enhance its role as a cryptographic accumulator. Bitcoin should facilitate functionalities that strengthen second-layer capabilities.”

Lopp also emphasised that a previous call for “hardcore ossification,” made by some maximalists in the past, would have stifled innovation that gave rise to solutions like the Lightning Network, which significantly contributed to the scalability of the Bitcoin network for more efficient transaction processing.

“Lighning wouldn’t have been feasible without OP_CLTV. It might have been possible but considerably less efficient without SegWit.

And without OP_CSV, indefinitely long-lived Lightning channels wouldn’t have been possible.”

Lopp was referring to CHECKSEQUENCEVERIFY (OP_CSV) and CHECKLOCKTIMEVERIFY (OP_CLTV) — two BIPs implemented to support payment channels as soft forks.

Todd authored OP_CLTV, describing a Bitcoin operation code that allows a transaction output to become unspendable until a designated future point.

Lopp also noted that while a lack of consensus on base layer improvement proposals might lead to the Bitcoin protocol becoming static, developers are likely to continue innovating in ways that don’t require extensive permissions:

“If it’s not viable to implement an optimal solution at the base layer in the base protocol, what we typically observe is that solutions are added on as needed.”

The Casa executive believes that if Bitcoin fails to continue its scalability efforts, users will inevitably turn to entrust and transact with BTC through a select few “Bitcoin banks,” also known as custodians and exchanges. However, this choice comes with significant drawbacks:

“In such a scenario, it essentially becomes IOUs, doesn’t it? That’s not the future any of us would prefer to witness.”

As previously reported by Cointelegraph, proponents and analysts at Bitcoin Amsterdam 2023 emphasised the increasing significance of the cryptocurrency’s value proposition and its attributes as a robust form of digital currency in the face of an extended bear market.