Bitcoin's ColliderVM Enables Efficient Smart Contracts

Researchers from StarkWare and the Weizmann Institute of Science have introduced a novel solution to overcome several limitations of Bitcoin's scripting language. Their proposed system, ColliderVM, aims to enable the deployment of complex smart contracts on the Bitcoin network in a more capital-efficient manner. This new design could significantly enhance the computational efficiency of Bitcoin transactions, making it possible to execute multi-step processes securely across multiple transactions.

Traditionally, Bitcoin scripts are stateless, meaning each script executes independently without memory of previous states or intermediate computations. This limitation makes complex calculations nearly impossible. ColliderVM addresses this by allowing stateful computation on Bitcoin, which could revolutionize the way smart contracts are implemented on the network. The system leverages Scalable Transparent Arguments of Knowledge (STARKs), a type of zero-knowledge proof, to verify complex offchain computations with minimal onchain data, without requiring consensus-level changes to the Bitcoin network.

ColliderVM is designed to overcome specific constraints of Bitcoin, such as the limit of 4 million OPCodes per block and 1,000 stack elements per script. The new system is more computationally efficient compared to previous implementations, which used cryptographic one-time signatures like Lamport and Winternitz signatures. These signatures were notably heavy on computational resources. ColliderVM, on the other hand, relies on a hash collision-based commitment, which requires significantly fewer computing resources from honest operators than from malicious actors.

The researchers behind ColliderVM have drawn inspiration from the ColliderScript paper, which was co-authored by StarkWare, Cloudflare, and Blockstream. This system sets a challenge to produce an input that, when run through a hash function, produces an output with pre-determined features. This approach reduces the number of hash operations, making the script size and processing time more manageable. The researchers claim that this implementation reduces the number of hash operations by at least a factor of 10,000, making a STARKs-based Bitcoin sidechain nearly practical.

STARKs are recognized for their scalability and trustless nature, as they do not require a one-time secure setup. This makes them a reliable option for verifying complex computations on the Bitcoin network. The researchers argue that their more efficient system approaches make an onchain verification script for STARK-proofs "nearly practical," addressing the limitations of traditional implementations that would exceed Bitcoin’s script length limits.

Bitcoin is widely regarded as the most secure and reliable blockchain, but its feature set is limited compared to many altcoins. Sidechains like Blockstream’s Liquid exist, but they are not trustless. The researchers behind ColliderVM aim to create a trust-minimized system, where users would still need to trust that at least a minimal subset of network participants will act honestly to ensure the correct functioning of the system. This approach is a step towards achieving a trustless sidechain on Bitcoin, which has been a long-standing goal in the cryptography space.

The lead authors of the study include Eli Ben-Sasson, co-founder of StarkWare, along with researchers Lior Goldberg and Ben Fisch. Ben-Sasson has long advocated for the use of zero-knowledge proofs to improve blockchain scalability. In a recent interview, he noted that a real Bitcoin layer-2 solution would need to have "the security of Bitcoin itself." While current solutions rely on trust in signers or fraud-proof-based economic incentives, the Lightning Network is recognized as having the security of Bitcoin. The introduction of ColliderVM represents a significant step towards achieving a more secure and efficient smart contract system on the Bitcoin network.