Recently, there has been a lot of buzz surrounding BitVM, a Bitcoin-based virtual machine. Some industry pundits speculated that it could bring decentralized finance (DeFi) applications to the Bitcoin network, similar to what the Ethereum Virtual Machine (EVM) did for Ethereum. However, the developers behind BitVM are clarifying that its main goal is to scale Bitcoin, rather than focus on implementing smart contracts and altcoins.
Robin Linus, the project lead at ZeroSync who released BitVM’s whitepaper, emphasized that his intention with BitVM is not to launch DeFi on Bitcoin, stating, “The real killer app is scaling Bitcoin. [I’m] not a big fan of smart contracts. [I’m] really interested in making it so that Bitcoin can process millions of transactions per second.”
Adding to this perspective, Super Testnet, a pseudonymous developer working on BitVM, expressed concerns about flooding BitVM with EVM-like tokens from the Ethereum ecosystem, as many of them are perceived as Ponzi schemes. He also mentioned that building a decentralized exchange on Bitcoin would be a step backward.
The developers believe that BitVM won’t render altcoins useless, as some have claimed, but it could potentially divert demand away from them. They hope that Bitcoin remains the dominant monetary unit on the network to maintain stability in commerce.
Furthermore, BitVM aims to address one of the shortcomings of the Lightning Network, which is payment reliability. While Lightning is faster than anything that can be built on Bitcoin, it still struggles with ensuring payment reliability. BitVM’s payment infrastructure intends to improve this aspect and reach 60% of the transaction speed of the Lightning Network.
It is important to note that BitVM is optional, similar to the Lightning Network. Users will have the freedom to transfer their Bitcoin or Bitcoin-assets out of the virtual machine back into cold storage or wherever they were beforehand. The developers emphasize that no one is compelled to send their money into the virtual machine if they want to keep it safe.
There has been some confusion regarding BitVM’s capabilities, as its whitepaper suggests that it can compute “anything.” However, the developers clarified that additional primitives need to be built in order to achieve that level of computational flexibility. Currently, BitVM is capable of performing basic functions, and the developers are continuously working to expand its capabilities.
The collaboration between Linus and Super Testnet began around 18 months ago, when they met at a Bitcoin conference. They have been dedicated to scaling Bitcoin at the scripting level ever since.
In summary, BitVM is a Bitcoin-based virtual machine that aims to scale Bitcoin rather than implement DeFi applications. The developers are primarily focused on improving Bitcoin’s transaction processing capabilities and enhancing payment reliability. While they acknowledge the potential impact on altcoins, they emphasize the importance of Bitcoin’s stability as a monetary unit. BitVM is an optional feature, and the developers are continuously working to further develop its functionalities.