3.1 Protocols

Biop combines Optimistic rollup protocol and PoS (Proof of Stake) consensus algorithm to realize decentralized Bitcoin L2. This chapter will explain the two protocols and the two roles of the protocols: Sequencer and Validator.

3.1.1 Optimistic Rollup Protocol

Optimistic rollup is a type of layer-2 scaling solution that relies on off-chain computation to record transactions in layer-2 trustlessly. Optimistic rollup is basically just a fancy way of describing a blockchain that piggy-backs off of the security of another "parent" blockchain. Specifically, Optimistic rollup takes advantage of the consensus mechanism (like PoW or PoS) of their parent chain instead of providing their own.

Optimistic rollup has been implemented on Ethereum and made a big success. Optimistic rollup on Biop is an approach to scaling Layer 1(Bitcoin) that involves moving computation and state storage off-chain. Biop executes transactions off the Bitcoin network, but post transactions data to Bitcoin as witness.

Optimistic rollup operators bundle multiple off-chain transactions together in large batches before submitting to Bitcoin. This approach enables spreading fixed costs across multiple transactions in each batch, reducing fees for end-users. Optimistic rollup also uses compression techniques to reduce the amount of data posted on Bitcoin.

Optimistic rollup is considered "optimistic" because they assume off-chain transactions are valid and don't publish proofs of validity for transaction batches posted on-chain.

3.1.2 PoS Consensus

Biop is a blockchain which uses the PoS (Proof of Stake) consensus mechanism to ensure decentralization and security. As a decentralized computing chain, Biop V1 will be consistent with the block generation time of Bitcoin. After the block generation of Bitcoin network, Biop uses Bitcoin block as input, computes the BTC’s state and other protocols’ state, and finally save the computing results to Biop's block.

PoS (Proof of Stake) underlies certain consensus mechanisms used by blockchains to achieve distributed consensus. In PoW (Proof of Work), miners prove they have capital at risk by expending energy. Biop uses PoS, where sequencer explicitly stake capital in the form of BIOP token into a smart contract on Biop Chain. This staked BIOP token then acts as collateral that can be destroyed if the sequencer behaves dishonestly or lazily. The sequencer is then responsible for checking that new blocks propagated over the network are valid and occasionally creating and propagating new blocks themselves.

3.1.3 Sequencer

The block generation node of Biop Chain is called Sequencer, who’s duty is similar to the Sequencer in Optimistic rollup protocol: packaging, verification and execution of blocks. The difference is that Biop uses multiple Sequencers to generate blocks to ensure the decentralization of Biop Chain. Similar to become a Validator, becoming a Sequencer also requires to stake a certain amount of BIOP token. Generating correct blocks can be rewarded with BIOP token, but generating incorrect blocks will be deducted from the bond as a penalty.

3.1.4 Validator

Optimistic rollup relies on a fault-proving scheme to detect cases where transactions are not executed correctly. The role who generates the fault-proving is called validator. After a rollup batch is submitted on Bitcoin, there's a time window (called a challenge period) during which anyone can challenge the results of a rollup transaction by computing a fault proof.

If the Validator’ s fault proof succeeds, the rollup protocol re-executes the transaction(s) and updates the rollup's state accordingly. The other effect of a successful fault proof is that the Sequencer responsible for including the incorrectly executed transaction in a block receives a penalty.