exSat Aims To Create Seamless Interoperability Between Bitcoin & Its Emerging Layer-2 Ecosystem

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Within the EOS community, a fresh approach has arisen to boost Bitcoin‘s scalability and compatibility. This innovation aims to link Bitcoin with the rising Layer-2 scaling alternatives and narrow the divide between them, ultimately making Bitcoin more versatile and valuable.

The new project, named exSat, describes itself as a connecting layer for Bitcoin. In a blog post, the exSat team explained that it’s made up of different protocols and tools to expand Bitcoin’s data consensus layer and improve its compatibility and capacity while maintaining top-notch security. Uniquely, exSat enables direct inquiries about Bitcoin and related ecosystem token balances to streamline asset transfers between Bitcoin’s primary chain and various Layer 2 solutions.

Bitcoin’s Scaling Barriers

According to exSat, the traditional design of Bitcoin limits its ability to handle smart contracts and scale effectively. As a result, users rely on intermediaries and external solutions for transactions that cannot be processed on-chain. This reliance, in turn, can lead to a more centralized system within Bitcoin’s growing community. The downside is an increased risk of security vulnerabilities due to the involvement of intermediaries.

The Bitcoin L2 ecosystem’s fractured structure adds complexity to the situation, as it includes multiple types of digital assets. This diversity negatively impacts interoperability and causes liquidity to be dispersed, posing challenges for Decentralized Finance (DeFi) built specifically for Bitcoin before it becomes widely adopted.

At the BTC L2 Conference in Hong Kong, Yves La Rose, the CEO and founder of ENF, showcases exSat.

exSat’s Solution

ExSat aims to conquer these obstacles using its innovative Docking Layer. This layer is underpinned by a hybrid Data Consensus Extension Protocol that combines the elements of Proof-of-Work, Proof-of-Stake, and Delegated Proof-of-Stake consensus mechanisms.

ExSat developed a system for indexing decentralized state data related to Bitcoin ordinals and other assets in its ecosystem. By utilizing EOS RAM, this system ensures quick access and minimal latency. This feature, combined with its compatibility with Ethereum Virtual Machine (EVM), empowers developers to create smart contracts on Bitcoin at affordable gas fees. Consequently, exSat’s network becomes more scalable while enhancing its overall functionality.

The system incorporates PoW mining from Bitcoin’s traditional mining network to synchronize block data to exSat, ensuring that Bitcoin’s fundamental security is carried over to exSat’s platform. Adding to the mix, PoS by BTC Staking Validators enables BTC block data to be verified by validators, similar to tradition PoS chains, while the EOS-powered Data Consensus Extension Protocol enables exSat to utilize the ample block space of EOS’s chain for on-chain data storage for BTC ecosystem assets. 

Furthermore, exSat brings decentralized indexing of state data for native Bitcoin assets such as BTC, Runes, BRC20, and BRC721 tokens through its system. This feature ensures authentic on-chain trust, smart contract functionality, and compatibility with Ethereum Virtual Machine (EVM). Crucially, it enables intricate business logic of advanced smart contracts to be initiated by Bitcoin transactions.

ExSat’s third key feature is its built-in smart contract platform that offers EVM compatibility alongside uniform gas fees for Bitcoin (BTC), Bitcoin derivatives like Ordinals, Ethereum (ETH), and stablecoins.

In summary, exSat’s network of synchronizers and validators play a crucial role in completing the setup. Synchronizers act as intermediaries between Bitcoin (BTC) and exSat, ensuring swift and precise data transfer between the primary Bitcoin chain and its Layer 2 solutions using Bitcoin’s Proof of Work consensus. Validators, on the other hand, are responsible for verifying this data to maintain network security. Their verification work is backed by their staked BTC and XSAT tokens.

Based on exSat’s information, the system offers motivation for users to participate via EXSAT staking, while simultaneously guarding against harmful actions that may jeopardize the network.

In simpler terms, Bitcoin miners following the old methods can earn XSAT tokens as incentives by functioning as Synchronizers in the generation of blocks. On the other hand, validators will need to deposit 100 BTC as a bond and hold XSAT tokens to gain revenue privileges.

Evolving Bitcoin’s Utility

Exactis (previously known as exSat) announced that its Data Consensus Extension Protocol marks an important advancement in Bitcoin’s development. This innovative approach bridges Bitcoin and its Layer-2 networks, delivering increased scalability and compatibility. Developers will benefit from expanded possibilities, enabling them to construct more intricate smart contracts.

With Bitcoin’s shift towards a smart contract platform gaining momentum, exSat is confident that its design will significantly contribute to this progression. This belief stems from the potential of enhancing Bitcoin’s functionality and value as the world’s premier digital asset.

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2024-04-10 12:18