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

Nathan Cook nathan.cook at gmail.com
Thu May 23 19:21:39 UTC 2019

It's true that it fetches the block hash; the idea is to compare the block
hash's numeric value to the desired (uncompressed) difficulty directly,
using a 256-bit version of OP_LESSTHAN.

Nathan Cook

On Thu, 23 May 2019 at 22:18, Tamas Blummer <tamas.blummer at gmail.com> wrote:

> 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)
> 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 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> 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
>> _______________________________________________
>> bitcoin-dev mailing list
>> bitcoin-dev at lists.linuxfoundation.org
>> https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev
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