A Brief Introduction To RGB Protocols

On January 3, 2009, Satoshi Nakamoto launched the first Bitcoin node. From that moment, new nodes joined and Bitcoin began to behave as if it were a new form of life, a form of life that has not stopped evolving. Little by little, it has become the safest network in the world as a result of its unique design — very well thought out by Satoshi — because, through economic incentives, it attracts users, commonly called miners, to invest in energy and computing power which contributes to network security.

As Bitcoin continues its growth and adoption, it faces scalability issues. The Bitcoin network allows a new block with transactions to be mined in approximately 10 minutes. Assuming we have 144 blocks in a day with maximum values ​​of 2,700 transactions per block, Bitcoin would have allowed only 4.5 transactions per second. Satoshi was aware of this limitation, we can see it in an email sent to Mike Hearn in March 2011 where he explains how what we know today as a payment channel works. This is where off-chain protocols come in.

According to Christian Decker, off-chain protocols are usually systems in which users use data from a blockchain and manage it without touching the blockchain itself until the last minute. Based on this concept, the Lightning Network was born, a network that uses off-chain protocols to allow Bitcoin payments to be made almost instantaneously. Since not all these operations are written on the blockchain, it allows thousands of transactions per second and scales Bitcoin.

Be the first to comment

Leave a Reply

Your email address will not be published.