Blockstream has launched a new product to allow for fast and private settlement of Bitcoins using a pegged sidechain named ‘Liquid’ (LBTC).
The technology provider claims Liquid will deliver faster transaction settlement and privacy above the higher security and decentralisation offered from the base BTC blockchain.
The supply of LBTC will fluctuate based on the amount of BTC ‘pegged’ into this sidechain. Users will need to wait for 102 bitcoin confirmation (around 17 hours) to have their LBTC credited. The reason for a large amount of confirmation is due to the possibility of re-organisation from the main BTC blockchain.
The longest BTC chain re-org recorded was 53 blocks, all the way back in 2010. The confirmation time frame adds security to this sidechain. Coincidentally, the confirmation matches that of the ‘coinbase’ transaction – that also needs 100 blocks to be found before the BTC can be included in a new block.
Blockstream’s founders include Adam Back, Gregory Maxwell and Pieter Wuille. These developers/ cryptographers have been instrumental with their contributions towards the Bitcoin protocol. Notable examples include the development and deployment of Segwit soft fork to help Bitcoin transactions scale in late 2017.
Today they are one of the biggest companies currently contributing funding towards bitcoins core client development.
A list of 23 partners have already signed up for Liquid. The list includes a host of the biggest exchanges (including: Bitfinex, BitMEX, OKcoin). The theory goes that once you have LBTC confirmed on the Liquid sidechain, you can move funds instantly and anonymously between participants.
Click here for our Bitcoin (BTC) for beginners guide
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