OmniBOLT is based on BTC’s lightning network, which enables users to trade quickly and at low cost, issue FTs other than BTC, and realize the scalability of the BTC ecosystem.
Current status of Lightning Network
- Lightning Network was invented in 2015, launched in 2018, and has been growing steadily
- Currently there are 9k+ nodes, more than 30,000 channels, 5k+ BTC capacity, about 100 million USD
The basis of Omnibolt: Omnilayer protocol
It has a longer history than ETH and is relatively mature, enabling users to implement functions such as FT issuance, Crowd Sale, DEX, and OmniBOLT.
- FT: Smart Asset (fixed quantity), Managed Asset (variable quantity, can have minting and destruction functions like USDT)
- Crowd Sale: ICO, Crypto’s first public fundraising was achieved through the Omnilayer protocol, but it is not as flexible as smart contracts
- DEX: It was implemented on BTC in 2015, but the gas is expensive and there is no scalability
- Omnibolt: A lightning network that can support smart assets, making it easier for assets to enter the lightning network through the mature Omnilayer protocol
What is issued through Omnilayer is a string of assets recorded on BTC
OmniBOLT solves BTC’s pricing problem
- BTC cannot leave the BTC public chain to set its own price, and relies on centralized exchanges or cross-chain transactions
- OmniBOLT can issue stablecoins, with low gas and fast speed, making transactions easier and achieving BTC pricing
- Stable settlement layer: Omnilayer has issued more than 2 billion stablecoins as a seed fund pool to price BTC, and the daily transaction volume of BTC is more than 8 billion.
OmniBOLT reduces the cost of deploying and using the Lightning Network
- Lightning Network requires professionals to install and run, the cost is very high, Lightning Network + BTC node operation + synchronization of large database
- Omnibolt has made the node mobile, simplifying the installation difficulties through contracts, and it can be set up in 2 minutes
- Omnibolt supports USDT, eliminating the volatility of payment currencies. Previously, the Lightning Network could only pay BTC.
OmniBOLT's Technical Architecture
- The bottom layer: public chains such as BTC or BCH, which need to keep transaction types, script types, compilers, etc. consistent
- Middle layer: Onchain protocol, also known as Omnilayer, the settlement layer of the Lightning Network, is used to implement issuance, destruction, transfer, ownership, authentication and other logics, and is relatively mature
- Top layer: OBD network, a payment network composed of various channels, which ensures payment correctness through HTLC protocol
Transaction Implementation
- Omnilayer can issue FT, but each token has its own logical network. The same token can only be transferred within its own network and cannot be verified across networks.
- OmniBOLT can support communication between nodes and realize token exchange between different logical networks through atomic swap
Protocol Suite
- The bottom layer: onchain protocol, namely Omnilayer, as the settlement layer, using OmniBOLT#03and#04definitions to build transactions and Omnilayer
- Middle layer: obd network, a network composed of channels,#02builds a point-to-point protocol,#03builds Omnilayer transaction and RSMC,#04is the payment routing protocol
RSMC ensures peer-to-peer payment without trust
HTLC, or hash time lock, connects all networks to form a channel
RSMC is the basis of HTLC
- The top layer, application layer protocol:#06defines Swap and AMM, which is much more complex than Uni, is built on protocol, and is much weaker than smart contracts
The specific specifications can be viewed through the Github link below the PPT
The Basics of Lightning Network
- P2SH: The BTC address is locked by the script, and BTC can be withdrawn only when two people sign correctly at the same time
- Distributed hash table, the cornerstone of distributed network: When a user's mobile phone node joins the network, it needs to broadcast its own node and search for neighbors to establish connections and build a local topology network; it is impossible for a node to establish a channel with all other nodes, and it needs to be achieved through a payment path, which can be achieved by using the greedy method and AI can be introduced
- Atomic swap: the core point of decentralized trading
It has been invented for a long time and is a necessary method for exchanging assets between public chains. The core is that after the user issues a token, if he does not get the desired asset, he can withdraw the issued asset.
Technical logic:
1. A sends tokens to B, and A uses a key known only to himself to lock the assets, thus building HTLC1
2. B needs to use the same key to construct HTLC2 and send the assets that A wants to A.
3. After A inputs the key and obtains B’s assets, the key will be known to the entire network
4. B can get the key to unlock HTLC1 and get the assets
5. If both parties time out, the assets will be returned. The properties of the hash time lock
With atomic swaps, we can construct AMM models and Swaps
- Traditional order books have price gaps
- A certain obd node submits to the liquidity pool in advance, covering the price difference part, simulating liquidity, and a small local range is xy=k. After the multi-end curve is spliced, the formula is unknown
- With transaction certainty and small impermanent loss, narrowing the scope of liquidity provision can reduce impermanent loss
The relationship between asset volatility and impermanent loss
other
- The settlement layer is safe, and more than 10 billion assets on Omnilayer have never been stolen
- Risks: zk applications may eliminate the lightning network; quantum computers; USDT sanctions, etc.
- Problem Solving: Payment Issues and BTC Pricing Issues
