After the controversy that followed the congestion of the Bitcoin network with BRC-20 tokens, blockchain developers have been looking at solutions that could address these limitations. Bitcoin developers had previously considered censoring the Ordinals protocol, a solution that does not seem to have unanimous support. However, thanks to the infrastructure development company for Lightning Network, Lightning Labsthis scaling problem may have found a solution.
Lightning Labs recently unveiled a new protocol for issuing, sending, and receiving assets on the Bitcoin blockchain. In a blog post dated May 16, the Lightning Labs team noted that current methods of registering assets on the blockchain are “particularly inefficient”, presumably referring to the Ordinals protocol. These protocols that the Lightning Labs team describes as “cumbersome” indeed write asset metadata directly to the block space.
Features of Taproot Assets
This new protocol called Taproot Assets is designed to operate largely off-chain, to avoid congestion and exorbitant fees that affected Bitcoin the previous week. As Lightning Labs pointed out:
“Taproot Assets’ design makes it easy to issue and transfer assets without permission, minimize required on-chain fees, and will soon allow developers access to a growing Lightning Network. »
Interestingly, the anonymous developer Domo, behind the creation of the BRC-20 standard, stated that Taproot Assets was unequivocally “a much better solution” for creating new assets on Bitcoin compared to methods existing, such as JavaScript Object Notation (JSON) used by the Ordinals protocol.
Lightning Labs said the protocol was designed to meet the needs of both Bitcoin developers and users at the end of the chain. The blockchain company added that features in Taproot Assets would allow developers “to create new experiences on mobile and other less resource-intensive devices.”
Lightning Labs had put the project on hold following a lawsuit filed last year by the blockchain development company Tari Labs for infringement of intellectual property. The company felt that the name of the protocol – then called Taro – bore too many similarities to its own. The rebranding of the project allowed its restart.
The next step for Taproots Assets will be the finalization of the technical specifications of the project which will then be presented to the community in the form of improvement proposals (Bitcoin Improvement ProposalBIP), merging Taproot channels and finally rolling out the first testnet for a Taproot Asset payment channel on the Lightning Network.
Either way, the frenzy around BRC-20 tokens seems to have died down. After surpassing the $1 billion mark on May 9, the total value of BRC-20 tokens has since fallen back to $500 million, a drop of almost 50%.
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