Spiderchains are a development introduced by Botanix Labs to ensure the interoperability of the two largest blockchains on the market.
Bitcoin, as a base layer, is the most decentralized and secure blockchain network in the crypto industry. However, it faces limitations and challenges in scalability and composability that prevent it from realizing its full potential.
To solve these challenges, Botanix Labs developers have introduced a new concept: Spiderchains. This is a new type of layer-2 sidechain, compatible with the Ethereum Virtual Machine (EVM), that is linked to Bitcoin and will allow for broader use of this network.
Spiderchains are intended as an innovative development to ensure interoperability between Bitcoin and Ethereum, combining the best of both networks and enhancing their advantages and capabilities.
Spiderchains, a new way to build Bitcoin layer 2
Jameson Lopp, co-founder and CTO of CasaHODL, noted that Spiderchains represent one of the most interesting proposals that have been put forward for building Bitcoin's Layer 2, although like other proposals, they also have their trade-offs and complexities.
One of the distinctions Lopp made about this development is that Spiderchains do not require the implementation of any protocol changes at the base layer; that is, in Bitcoin.
Botanix Labs developers published a Valid identity document detailing all the technical aspects of the Spiderchains.
Proof of Stake (PoS) based sidechains
Spiderchains make use of the Proof of Stake consensus protocol, rather than Proof of Work, like the Bitcoin mainnet. According to the developers at Botanix Labs, this is because PoS offers great advantages for scalability that are not possible with PoW.
However, Botanix Labs developers argue that Bitcoin is the most suitable blockchain for Layer 2 development, thanks to the high level of decentralization, security and immutability that the PoW protocol provides.
In the Spiderchains whitepaper, the developers explained that PoW is essential to ensure the decentralization of the Bitcoin network, while PoS is essential to ensure the speed, scalability, and performance of sidechains built on top of it.
slashing
To ensure security, Spiderchains implement the slashing, in order to punish interoperability time and node misbehavior.
Regarding this method, Lopp warned that if the downtime period for penalizing misbehaving nodes is set too low, it could open the door to DoS attacks.
On the other hand, honest nodes are rewarded on sidenets through transaction commission fees, as Spiderchains themselves do not generate new tokens.
Compatible with Ethereum Virtual Machine
Ethereum is one of the most trusted blockchain ecosystems in the industry and many of the blockchain technology developers and builders are familiar with its smart contract programming language, Solidity.
This is why Botanix Labs developers are leveraging the strengths, robustness, and potential of the Ethereum application ecosystem to build the new layer 2 infrastructure on the blockchain.
An interesting proposal
Botanix Labs developers introduced Spiderchains as a solution to the challenges facing Bitcoin and Ethereum, due to the massive growth both networks have experienced in recent years.
Bitcoin is the most well-known cryptocurrency on the market and the most powerful, robust, and decentralized blockchain, while Ethereum is the most adopted smart contract platform and the largest application ecosystem in terms of value stored. However, Ethereum’s vast ecosystem of decentralized financial applications is not available on Bitcoin, and Bitcoin sidechains lack demand, so the TVL (Total Value Locked) of these chains only accounts for 0,1% of Bitcoin’s total market cap, marking a huge difference with Ethereum, which locks up more than $21.180 billion USD or almost 11% of its market cap in TVL.
Overall, Spiderchains are an interesting proposal with which Botanix Labs seeks to build a more interoperable and scalable blockchain ecosystem. However, as Lopp highlighted, the design of this new type of sidechain and its economic security system involve unprecedented complexity.
Continue reading: What are decentralized public infrastructure networks or DePINs?
