Smart Finality
Bitcoin transactions do not have any official point at which they are "final" or have "cleared". There is a generally accepted standard that after 6 confirmations a bitcoin transaction can be considered "final". There is nothing special about 6 confirmations, just at that point it becomes generally uneconomical to pull off a 51% attack to execute a double spend. According to crypto51.app it would take over $350,000 to successfully pull off a double spend and that is likely undercutting it as the prep and effort needed would be extensive.
​https://www.crypto51.app/ (as of 7/13/2020)

The Problem

Because of this it is generally required that a bitcoin transaction reached 6 confirmations before you can access coins that you sent or deposited to a 3rd party platform like an exchange. This makes sense but its overly cautious. If you just want to deposit $500 in bitcoin theres no way you are going to spend over $350k to steal that much. Bitcoin finality is not static, its situational. the question is not "has this reached 6 confirmations" but "has this transaction reached sufficient confirmations that a 51% attack is not economically viable?"

Our Solution

For smart finality we will be using renVM and some rough assumptions to allow users to access their bitcoin on ethereum in as few as 1 confirmation and take on the risk that the transaction never reaches 6. When a user initiates a smart finality shift, in return for a fee, before renVM mints renBTC we will send the user pre-minted renBTC from a liquidity pool but only when our custom shift criteria are met. RenVM only mints renBTC on ethereum when the initiating bitcoin transaction reaches 6 confirmations so if it never reaches that threshold the 0confirmation liquidity pool will take a loss.
To start out we will be allowing 2 confirmation shifts for all transactions under 2 BTC in value. Once we get some feedback and see how the platform responds we will look into adjusting or adding more tiers of parameters.
Last modified 1yr ago
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