[bitcoin-dev] OP_DIFFICULTY to enable difficulty hedges (bets) without an oracle and 3rd party.

Tamas Blummer tamas.blummer at gmail.com
Thu May 23 19:18:06 UTC 2019


That opcode would not help as it fetches block hash and not the content of the header.

> On May 23, 2019, at 21:05, Nathan Cook <nathan.cook at gmail.com> wrote:
> 
> You can get the same effect with OP_CHECKBLOCKATHEIGHT as proposed by Luke Dashjr (https://github.com/luke-jr/bips/blob/bip-cbah/bip-cbah.mediawiki <https://github.com/luke-jr/bips/blob/bip-cbah/bip-cbah.mediawiki>) if you also re-enable/extend certain opcodes like OP_AND and OP_LESSTHAN. See https://lists.linuxfoundation.org/pipermail/bitcoin-dev/2016-September/013149.html <https://lists.linuxfoundation.org/pipermail/bitcoin-dev/2016-September/013149.html> and the ensuing thread.
> 
> Nathan Cook
> 
> 
> On Thu, 23 May 2019 at 21:33, Tamas Blummer via bitcoin-dev <bitcoin-dev at lists.linuxfoundation.org <mailto:bitcoin-dev at lists.linuxfoundation.org>> wrote:
> Difficulty change has profound impact on miner’s production thereby introduce the biggest risk while considering an investment.
> Commodity markets offer futures and options to hedge risks on traditional trading venues. Some might soon list difficulty futures.
> 
> I think we could do much better than them natively within Bitcoin.
> 
> A better solution could be a transaction that uses nLocktime denominated in block height, such that it is valid after the difficulty adjusted block in the future.
> A new OP_DIFFICULTY opcode would put onto stack the value of difficulty for the block the transaction is included into.
> The output script may then decide comparing that value with a strike which key can spend it.
> The input of the transaction would be a multi-sig escrow of those who entered the bet.
> The winner would broadcast.
> 
> Once signed by both the transaction would not carry any counterparty risk and would not need an oracle to settle according to the bet.
> 
> I plan to draft a BIP for this as I think this opcode would serve significant economic interest of Bitcoin economy, and is compatible with Bitcoin’s aim not to introduce 3rd party to do so.
> 
> Do you see a fault in this proposal or want to contribute?
> 
> Tamas Blummer
> 
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