As part of our on-going Tweetstorm Series, we showcase excellent Twitter threads on the most interesting topics in the industry and publish them here on Decentralize.Today.

Today we feature Alexander Leishman, the CEO & CTO of River Financial.  He is a Bitcoin industry veteran having worked at multiple companies in  the space. He has a Masters Degree in Computer Science from Stanford  University and fell in love with Bitcoin after reading Friedrich Hayek's  The Denationalization of Money. You can follow him on Twitter @Leishman for more of his excellent insights about Bitcoin.

Let's get started!

​Bitcoin tech thread time! Here is some of the Bitcoin research and technical work that we're excited about at River Financial!

1. ERLAY: Significantly decreasing the bandwidth and increasing the connectivity of the Bitcoin P2P network.

Erlay, by Peter Wuille @pwuille,  Greg Maxwell, Gleb, et al is a big deal. It DRASTICALLY reduces bandwidth requirements of running a full-node compared to the current  flooding approach. Bandwidth no longer scales linearly with peer count,  decreasing the cost of running well connected nodes. Take a look at this figure from their paper (https://arxiv.org/pdf/1905.10518.pdf…). With Erlay, a node with 32 peers uses only marginally more bandwidth  than a node with 8 peers. With BTCFlood (the current approach) the node uses 4x the bandwidth!

Currently, every time a node receives a new tx, it announces it to all of its peers. This is highly inefficient because it creates a lot of redundant announcements.  This chart shows the amount of data currently used for tx announcements  by connectivity.

The insight behind Erlay is  that nodes need only announce txs to a small subset of peers and then  engage in an efficient set-reconciliation protocol periodically to detect any missed transactions. This set recon. protocol uses the Minisketch library previously announced. With Erlay it becomes way less  expensive to run very well connected nodes, increasing the connectivity  and security of the Bitcoin P2P network. Great work to everyone  involved!

2. Assume UTXO from @jamesob: Reduce the time it takes to go from zero to full UTXO-set (with an extra security assumption). Link to Github proposal HERE.

3. Discreet Log Contracts (DLCs): Create off-chain contracts for any arbitrary price feed that settle cryptographically on-chain with a simple signature. @chris_stewart_5, @Suredbits and @dglab_official are doing great work on designing DLC standards. The magic of Schnorr! Maybe we'll see a River Financial DLC oracle in the future. Who knows what could happen?

4. Expressive Taproot Contracts:  With tapscript and schnorr signatures/multisig we can build a large number of more interesting multi-party contracts. Bitcoin DAO anyone?

5. Signature Alchemy: @n1ckler, Andrew Poelstra and @pwuille continue to discover amazing ways to utilize signatures to do all sorts  of cool stuff: Adaptor signatures, musig, etc. what's next?

6. ELTOO: The @Snyke and @roasbeef proposal to rid ourselves of the toxic waste in today's lightning channel construction. More details HERE.

7. Zero-knowledge Contingent Payments:  Atomically swapping Bitcoin for provable information/solutions. Lots of  cool stuff left to explore here! Check out more info in the wiki page.

8. Proof of Reserves: This is proof that you actually control at least a particular amount of particular  assets, especially important for exchanges holding Bitcoin and other  assets. Will 2020 be the year a Bitcoin company gets Nic Carter @nic__carter to stop talking about Proof of Reserves? Partially Signed Bitcoin Transactions (PSBT) and other standards are making it easier to operationally accomplish things like this.

9. Key-send & spontaneous payments in Lightning Network: Soon  we will be able to send lightning payments to a public key instead of  requiring recipients to first generate invoices. This should  SIGNIFICANTLY reduce the friction of using Lightning!

This  allows users to start exploring a new set of use cases that benefits  from this type of spontaneous payment. The payment can also carry  additional application-specific data such as an account ID, API call,  etc. This new feature requires the new EOB (extra onion blob parsing)  implemented here. The coolest part about this new feature is that it can  be used today in the wild as long as both nodes are updated to this  branch!

More info HERE.

10. Standardization around Schnorr threshold signatures: Mu-sig gives us n-of-n. Looking forward to m-of-n standards.

About The Author

Alexander Leishman is the CEO & CTO of River Financial. He is a Bitcoin industry veteran having worked at multiple companies in the space. He has a Masters Degree in Computer Science from Stanford University and fell in love with Bitcoin after reading Friedrich Hayek's The Denationalization of Money.

River Financial is a San Francisco based firm dedicated to helping people invest in Bitcoin. They provide their users with premium customer service and  access to cutting edge Bitcoin features.