The Design Logic of Bitcoin Lightning Network and the Innovation of Thunderbolt Protocol

1. Payment Challenges Facing Bitcoin

Bitcoin, as a decentralized and immutable cryptocurrency, faces practical application dilemmas in everyday payment scenarios. When users want to buy a cup of coffee with Bitcoin, they often encounter issues such as long transaction confirmation times and high fees. These problems stem from the original design intent of the Bitcoin network, which was not meant to handle tens of thousands of small payments per second.

The script structure of Bitcoin is relatively conservative, limiting most off-chain interaction scenarios. However, users wish to conveniently and quickly use Bitcoin for daily consumption, such as purchasing game items or tipping videos, rather than waiting for approximately ten minutes for confirmation.

2. Lighting Network: A Solution Under Trade-offs

The Lightning Network can be likened to a fast channel next to the Bitcoin main chain. Its core idea is to establish dedicated "payment channels" between users, achieving high-frequency off-chain accounting, and only synchronizing the final state to the blockchain when the channel is closed. This model is similar to the way friends settle up in one go after accumulating multiple expenses.

However, the Lighting Network has revealed multiple dilemmas in practical applications:

1. The threshold for establishing a channel is high, requiring funds to be locked in advance.
2. Complex routing issues may cause transaction failures due to insufficient funds or unavailable nodes in indirect channels.
3. Security risks require users to stay online to prevent fraudulent activities.

Although the Lighting Network has been in operation for many years, these structural defects have made it difficult for its practical application to break through the bottleneck. Currently, the total amount of funds locked in the Lighting Network is only about 100 million USD, which is negligible compared to the trillion-level market value of the Bitcoin system.

3. The Innovation of the Thunderbolt Protocol

The Thunderbolt protocol is a soft fork upgrade scheme based on the Bitcoin main chain, aimed at fundamentally enhancing Bitcoin's scalability, transaction performance, and programmability.

3.1 Core Mechanism

The core mechanism of Thunderbolt includes:

1. Flexible and adjustable multi-signature: Split the Bitcoin signature into two parts, user and committee, to achieve transfers without online conversation by adding a "small secret".

2. Asynchronous fault-tolerant committee ledger: A service group composed of multiple nodes is responsible for bookkeeping, and the ledger can continue to operate normally even if some nodes fail.

3. Atomic Swap Finalization: Ensure seamless off-chain reconstruction and on-chain redemption through a three-step atomic swap process, preventing any party from profiting unilaterally.

3.2 protocol design and key innovations

1. Non-interactive, recursive signature delegation: Designed a repeatable adjustable threshold Schnorr signature structure, significantly reducing online requirements.

2. Each transfer replaces the "old lock" with a "new lock": by updating the signature, the old "lock" is completely invalidated, preventing the old signature from being reused.

3. Leave only one trace on the chain: reduce on-chain operations to enhance privacy.

4. Offline will not lose money: as long as the majority of the committee is online, the transfer or redemption can be completed.

5. True "machine proof" security: all key steps are formally verified.

4. Comparison of Thunderbolt with Existing Lighting Network Solutions

The main advantages of Thunderbolt lie in its security and theoretical completeness, but it also has disadvantages such as complex deployment, poor compatibility with the main chain, and insufficient ecological support.

5. Potential Impact and Development Path of Thunderbolt

The potential development paths of Thunderbolt include:

1. Integrated with Rollup as a DeFi engine on the Bitcoin side.
2. Form an independent standard ecosystem, running in parallel with the main chain.
3. Replaced by a simpler solution.

The greatest significance of Thunderbolt lies in enabling Bitcoin assets to possess "off-chain contract composability" for the first time. The introduction of the two key features, UTXO Bundling and OP_CAT, brings native programmability and higher on-chain throughput to the Bitcoin network. This creates possibilities for unifying Bitcoin ecosystem protocols, accommodating various assets, and achieving BitMM.

However, Thunderbolt is still in the theoretical stage and there is still some distance before developers can actually apply it. Future development will depend on further improvement of the technology and the construction of the ecosystem.