EXTENDING THE SPV CONTRACT CONCEPT WITH PRIVACY GADGETS

DOI: 10.31673/2412-4338.2024.024961

Abstract

The SPV (Simple Payment Verification) contract extends the functionality of Bitcoin by enabling cross-chain operations through trustless synchronization with other blockchain systems. This approach allows users to verify Bitcoin transactions without running a full node by utilizing block headers, making it feasible for use on lightweight devices. The SPV contract enables the proof of transaction confirmations on the Bitcoin mainnet, which can then trigger predefined actions in the destination system. This paper also introduces innovative mechanisms for creating untraceable yet verifiable proofs of actions within the Bitcoin network, thereby enhancing privacy. By leveraging the SPV contract architecture, various use cases such as transaction status verification, cross-chain transactions, and decentralized applications can be efficiently implemented. Additionally, security considerations and optimizations like the use of zk-SNARKs for cost-effective Merkle proof verification are discussed. The paper concludes by exploring the potential of SPV contracts in facilitating trustless cross-chain interoperability and advancing the development of complex, automated financial instruments across blockchain ecosystems.

Keywords: simple payment verification, concept proposal, light node, smart contract, transaction verification, block header, event trigger.

References
[BFT] Breaking bft. quantifying the cost to attack bitcoin and ethereum.
[BTC] Bitcoin whitepaper. https://bitcoin.org/bitcoin.pdf.
[PoW] Pow verification. https://developer.bitcoin.org/devguide/block chain.
[SPV] Svp contracts repository. https://github.com/summa-tx/bitcoin-spv.
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