Bitcoin sidechain RSK has taken a step towards decentralization with its new “Powpeg” bridge protocol, which creates a trustless connection when swapping BTC for the network’s version of the digital asset, Bitcoin Magazine reported on 8 December.
The new system upgrade features a trustless BTC peg, which will allow the network to move away from having a group of entities control the chain’s funds. Up until now RSK users would send BTC to a multi-signature wallet — controlled by 12 different parties — and then wait for the “signatories” to approve the transaction. They would then be sent rBTC — RSK’s native token pegged 1-1 to real BTC — to their RSK wallet proportional to the first transaction.
The “Powpeg” bridge protocol will automate this process, with the “pegnatories” taking over the position of validators, who monitor the RSK multi-sig wallet and rBTC mining to protect the network’s users. When sending their BTC to the multi-sig wallet, users will now receive a proof of the transaction, which needs to be sent to “special-purpose hardware security modules” — called PowHSMs — that will distribute the correct amount of rBTC to the corresponding wallet. The Chief Scientist of IOVlabs (the firm developing RSK), Sergio Demian Lerner, said in a statement:
“We believe RSK should be the DeFi platform of choice for bitcoiners. We are committed to the ecosystem spirit and mindset of decentralization and security, and wish to make bitcoin and bitcoin-based financial opportunities available to all.”
The upgrade will also improve the security of the network, as pegnatories will no longer be able to control the funds in the bridge multi-sig contract. This new “defense-in-depth” approach to security will allow the network to achieve a unique multi-signature vault with “transparent and auditable time-delayed access”, Lerner added.