John Light has been a key proponent of enabling Bitcoin rollups and one of the foremost researchers in the Bitcoin ecosystem as a result. Light's research paper is well-known for illustrating how these specific scaling solutions can be adopted on BTC L1 to overcome the blockchain's scalability problem. It lays out how rollups can be a scaling solution for Bitcoin while also commenting on how they can impact settlement layers as well.
Light has also conducted additional research on complementary systems, such as validia chains.
In a Q&A with Trust Machines, the researcher and contributor to the Sovryn protocol on RSK explains how Rollkit's latest research integration has impacted how many believe we can use Bitcoin, and how rollups can be used to improve everything from processing crypto transactions and transaction data to expanding on the number of use cases for the BTC main chain.
Light was also a featured speaker in our recent Twitter Spaces session that dove into how rollups work and the challenges of building rollups on Bitcoin.
The Impact of Sovereign Rollups on Bitcoin
Trust Machines: We now have sovereign rollups on Bitcoin, thanks to Rollkit. What does this mean for Bitcoin in general?
John: The idea of a Bitcoin sovereign rollup is that you can have a rollup that is not connected to another blockchain through a native bridge. Therefore, the consensus rules of the blockchain are not defined by a smart contract that exists on another blockchain. What differentiates it from any other layer 1 chain is that the state of the rollup gets stored inside of the blocks of another blockchain, it's its parent chain. So in the case of one built on Bitcoin, it's the state of this chain. The full data in each block of the rollup is going to be stored in a Bitcoin block and then once a valid block gets confirmed – on or inside of a Bitcoin block – then that roll up block is now confirmed.
It has the same level of security in terms of its resistance to reorganization or double spending as any other transaction inside of that Bitcoin block. So this allows the sovereign rollup to inherit the full double spend resistance, and data availability of Bitcoin, which is a really great security benefit. You can contrast this with sidechains, which have their own independent security budget and therefore their own independent level of double spend resistance. It could theoretically be as high or even higher than Bitcoin in terms of its security but in practice, a lot of sidechains have a much lower security budget, and therefore they cost a lot less to do double spend transactions or to reorganize blocks in the blockchain.
Another thing that people are excited about by this announcement is that it could give developers the opportunity to start experimenting with what it's like to build a rollup on Bitcoin. It's not exactly like a rollup in that it doesn't have this trustless bridge with layer one like you would see with some of the rollups built on other chains, which support full validity rollups (ZK rollups) or optimistic rollups. But you can kind of get a feel for what it's like to build a rollup on Bitcoin without having to actually soft fork Bitcoin and add in the support for the full layer to rollup kind of model.
The Challenges of Implementing Different Types of Rollups on Bitcoin
Trust Machines: What are the barriers that need to be overcome?
John: I think there are two challenges to overcome. The first challenge is rather fundamental: currently, Bitcoin would not support a native trustless bridge to the rollup. We typically think of a rollup, like a layer 2 rollup, as built using a smart contract on some layer 1 chain. That smart contract enables users to have this trustless bridge with the rollup chain where they can move assets from the layer 1 chain to the layer 2 rollup chain, and then back to the layer 1 chain in a fully trustless kind of way. The rollup smart contract is able to actually validate state transitions on the rollup and therefore, it's able to validate that a withdrawal attempt from the rollup is either valid or invalid.
This is a really important property and this is what makes the trustless bridge. Currently, Bitcoin does not have enough functionality to be able to validate state transitions from chains that are built outside of the Bitcoin blockchain, or it has very limited functionality to do so. We can't really build true layer 2 rollups on Bitcoin until we get that functionality to verify rollup state transitions.
There are two ways that you can do this. One is using the optimistic rollup kind of bridge. That would require us to have support for generalized covenants, which is a type of smart contract. Or we want to have support for verifying validity proofs, which would enable us to have validity rollups, also known as ZK-rollups, where instead of playing this challenge-response game, we would actually use cryptographic proofs to prove that withdrawals are valid. And therefore, as soon as the proof is confirmed on chain, the withdrawal can be executed within a single block confirmation. So those are the two main flavors of rollups and we need some changes to Bitcoin to be able to support either of those.
Now, the second challenge is less severe and that's what people have figured out a solution to recently: the data availability problem. Until people discovered this way to use Taproot to store a lot of data in Bitcoin blocks, people only really knew how to store smaller amounts of data in a relatively inefficient way inside of Bitcoin blocks. So Bitcoin wasn’t seen as a very good or efficient data availability layer.
But now with the envelope technique that Casey Rodarmor from the Ordinals and inscriptions community invented to store data in large amounts inside of the Tapscript witness field, we are now able to store up to four megabytes worth of data as a single big block of data inside of a Bitcoin transaction. As long as we can get that transaction confirmed in a block directly with miners and circumvent the normal Bitcoin Core standardness rule for how big that witness data is allowed to be, that allows us to have rollup blocks inside of Bitcoin blocks that could be theoretically as large as four megabytes. That would support much more transaction throughput, and so makes building any kind of rollup on Bitcoin much more practical.
But because sovereign rollups on Bitcoin don't need the trustless bridge, we're able to just take advantage of that envelope technique to build sovereign rollups on Bitcoin today without any sort of consensus changes or soft forks.
How the Bitcoin Network Could Use Rollups to Improve Ordinal Functionality, Transactions and More
Trust Machines: Where do you see the employment of rollups? Where could a lot of that technology eventually be used?
John: For sovereign rollups in particular, I think the lowest hanging fruit is maybe giving NFT or inscriptions users a greater range of functionality of what they can actually do with their assets. For example, right now with inscriptions, holders are relatively limited in terms of how they can do their trades. Or if you're a creator, you're limited to what you can do. If you build a sovereign rollup on Bitcoin, you could build it in such a way that it has all kinds of new functionality.
It could be a complete copy of the Ethereum Virtual Machine (EVM) or the Clarity VM, and then you can take any smart contract that's compatible with that VM and run it on this sovereign rollup chain. In doing so, you could get all of that extra flexibility in terms of how you can do your drops, your trades, and your storage. On top of that, you'd still get that full Bitcoin security, you're still getting that full appeal of inscriptions that your NFTs are in the blockchain. The NFT is still in the blockchain, it's just that you can do so much more with it because the rules of the chain that are actually controlling how the NFT moves around are so much more flexible.
I also think one of the most pressing problems in Bitcoin and the wider cryptocurrency space is privacy, so I think that it would be really great to see somebody build a privacy-focused rollup, even if it's not a true layer 2 rollup. [They would probably require] some kind of trusted bridge, but still having that with the security of a sovereign rollup would be a really big improvement for Bitcoin users to be able to make transactions that are more private. A Zerocash protocol-style rollup chain that people could use to make fully encrypted peer-to-peer transactions would be hugely beneficial to the entire Bitcoin ecosystem.
Beyond that, I think, you know, the possibilities are totally wide open. Rollups are just new chains, so you have as much flexibility as you would for launching any other kind of new blockchain. It's just that if you do it as a sovereign rollup on Bitcoin or a layer 2 rollup on Bitcoin – once we have that functionality to build layer 2 rollups – then you also get the full Bitcoin-grade double spend resistance and data availability guarantees.
For more on how rollups are built on blockchains, how different types of rollups work (including ZK and optimistic rollups), and how rollups differ from other Bitcoin layers, visit our Trust Machines Learn Center and blog.