Introduction
The Bitcoin network is famously resistant to both attacks and centralization. Without offering a full explanation (which can be found here), this robustness is in large part thanks to the work of Bitcoin miners and the incentives that guide them in turning physical energy into digital gold. Across the world, anyone can verify the Bitcoin blockchain, assemble candidate blocks, and compete to solve an ever-changing, difficulty-adjusting, and energy-intensive cryptographic puzzle. This process, known as Proof of Work, is the most secure blockchain consensus mechanism not just because of its cryptographic complexity, but (more importantly) because of its built-in economic flywheel.
While PoW’s computational difficulty can rise and fall, the cornerstone of the network’s security is the revenue generated by mining operations. For the system to remain robust, miners must receive ample compensation for their efforts. The Bitcoin network addresses this by allocating rewards for miners who successfully and honestly participate in the proof of work consensus process.
As Bitcoin miners receive rewards sufficient to cover expenses, they continue to secure the network by investing energy through proof of work. Therefore, the more revenue-generating Bitcoin mining is, the more energy (money) miners are willing to expend, and the more economically difficult it is to attack the Bitcoin Network.
It's also crucial to acknowledge that Bitcoin's architecture incorporates certain deliberate limitations, stemming from the fact that it prioritizes security and decentralization. Though they have profound effects on its scalability and overall performance, it’s important to note that these are not flaws in the design of Bitcoin’s protocol; Bitcoin has earned its status not in spite of these limitations, but (in part) because of them.
Properly understanding how the Core network is trying to supplement and enhance the Bitcoin ecosystem will require a fuller discussion of Bitcoin’s constraints, especially those related to block size and transaction throughput. These topics are covered in the next few sections.
Limitations in Bitcoin’s Scalability and Performance
A. Bitcoin Block Size & Transaction Throughput
The foundational limitation of Bitcoin revolves around its block size and transaction throughput. The 1MB block size limit severely restricts the number of transactions that can be processed per Bitcoin block, and is a remnant of Bitcoin’s original security- and decentralization-focused design philosophy. This limitation results in a throughput of only 5-7 BTC transactions per second, not nearly enough to meet the requirements of modern finance or applications demanding higher transaction volumes.
B. Bitcoin’s Confirmation Delays
Compounding the issue of limited throughput is the inherent delay in Bitcoin’s transaction confirmation. Bitcoin's protocol dictates an average block time of approximately 10 minutes. This interval, which enhances Bitcoin’s network security through proof-of-work consensus, also leads to significant delays in settling BTC transactions. In an environment where immediacy is increasingly valued, these delays present a substantial bottleneck for Bitcoin's adoption in many use cases.
Limitations in Bitcoin’s Scripting and Computation
A. Bitcoin’s Lack of Turing Completeness
A critical limitation in Bitcoin's scripting language is its lack of Turing completeness. Unlike more versatile blockchain platforms, Bitcoin's scripts cannot perform complex computations or carry out a broader range of functions. This limitation inherently restricts the scope of possible decentralized applications and smart contracts that can be developed on the Bitcoin blockchain.
Limitations in Bitcoin’s Ability to Support Smart Contract and Application Development
A. Bitcoin’s Lack of Native Smart Contract Language
Unlike blockchain platforms like Ethereum, which boast dedicated smart contract languages such as Solidity, Bitcoin lacks a native language designed specifically for writing smart contracts. Its scripting language is primarily for transaction validation, confining the network's functionality to basic transactional capabilities.
B. Bitcoin’s Restricted Development Ecosystem
The development ecosystem surrounding Bitcoin is more narrowly focused on enhancing financial transactions and maintaining robust security. This focus has led to a less diverse and versatile Bitcoin developer community, especially when compared to platforms explicitly geared towards decentralized applications and smart contracts.
Limitations from Bitcoin’s Network Rigidity and Conservatism
A. Bitcoin’s Lack of Upgradeability and Flexibility
Bitcoin's strict adherence to its original design and protocol makes it less flexible in adopting new features and technologies. This rigidity does preserve the Bitcoin network's stability and earns trust, but it also makes it less able to adapt to the emerging technological advancements necessary for building complex smart contracts and other kinds of applications.
Limitations in Bitcoin’s Interoperability and External Communication
A. Bitcoin’s Lack of Interoperability
Bitcoin operates largely as a standalone blockchain with limited interoperability. This isolation hinders its ability to seamlessly interact with other blockchain systems, a critical requirement for many advanced applications that thrive on cross-chain synergies.
B. Bitcoin’s Restricted Communication with External APIs
In the evolving landscape of smart contracts, the ability to interface with external data sources and application programming interfaces (APIs) is crucial. Bitcoin's architecture does not support native oracles or direct communication with external systems. This limitation restricts Bitcoin's capacity for dynamic interaction with real-world data, a feature increasingly important in decentralized finance (DeFi) applications, supply chain management, and other sophisticated blockchain uses.
Recognizing Bitcoin's deliberate limitations, subsequent initiatives have attempted to expand blockchain utility. These endeavors range from Bitcoin scaling solutions to entirely new blockchain networks, each making distinct design choices. However, these efforts consistently encounter the oft-cited ‘blockchain trilemma', struggling to optimally balance security, decentralization, and scalability. By and large, the prevailing opinion is that a blockchain project can have two of these properties, but only at the expense of the third.
Alternatives like Ethereum optimize for enhanced transaction speed and composability [2] through the use of interoperable smart contracts, more scalable consensus mechanisms, etc. As an example, one pivotal shift in blockchain infrastructure was the introduction of Proof of Stake (PoS), which replaces miners expending real-world energy with stakers posting tokens as collateral. While PoS is a valuable innovation, it raises technical and operational concerns (staking practices have already led to a certain degree of centralization, for example). More broadly, these chains abandoned any hope of leveraging Bitcoin’s peerless decentralization and security by completely severing ties to its consensus model.
Even those blockchain networks that retain connections to Bitcoin have various shortcomings stemming from a heavy dependence on Bitcoin’s inherently less scalable infrastructure, the absence of Turing completeness in their design, a failure to fully capitalize on features that enable blockchain interoperability, etc. In addition, many of these protocols are poorly aligned with the Bitcoin network, delivering little in the way of value to Bitcoin and failing to reinforce its security and decentralization.
Despite these challenges, the emergence of phenomena like Ordinals and the BRC-20 token standard demonstrates strong demand for expanding Bitcoin-secured use-cases. Given Bitcoin’s status as the ultimate source of decentralized protection, widening its umbrella would prove enormously valuable. Bitcoin, too, could benefit; with the halving schedule continuing to reduce block subsidies every four years, the question of how to remunerate miners for securing the network will only grow more important.
Core Chain is the blockchain created in response to the above issues. It has been designed with many goals in mind, including:
Sustainably governing a scalable, EVM-compatible smart contract platform in a way that preserves network integrity and decentralization comparable to Bitcoin’s.
Leaning on Bitcoin miners, the bulwark of Bitcoin, for security and decentralization in the consensus process.
Aligning with the Bitcoin network by providing Bitcoin miners with increasingly-needed supplemental rewards, all while costing Bitcoin miners virtually nothing in the way of additional expenses.
Expanding Bitcoin miner governance, security, and protection to EVM-compatible smart contracts.
Turning Bitcoin from a semi-passive network protecting a passive asset into an active enabler of far more use-cases for the BTC asset and other forms of digital property – while simultaneously reinforcing its core functionality.
The center of this ambition lies in Core Chain’s novel Satoshi Plus consensus mechanism. Its two basic components are a pioneering Delegated Proof of Work (DPoW) technique that leverages the hash power of Bitcoin miners, and Delegated Proof of Stake (DPoS), which is well known throughout the blockchain world. Together, these make it possible to sustainably govern a scalable smart contract platform in a way that addresses the above goals.
The remainder of this paper will provide a technical overview of the Core network. It begins with a discussion of Core Chain’s design principles and ethos, and situates them within the broader context of blockchain protocols. Then, it turns to a breakdown of Core’s architecture, with a particular focus on the integration of DPoW and DPoS. The final three sections will go deeper into security considerations, Core Chain’s tokenomics, and Core Chain’s governance structure, respectively.
Naming Convention - For the sake of clarity, the common name of the blockchain network and smart contract platform is “Core Chain,” which can also be referred to as the “Core,” “Core blockchain,” “Core blockchain network,” or “Core network.” The “Core ecosystem” denotes the broader set of applications and protocols built on top of the Core chain. Core DAO is the decentralized autonomous organization responsible for the development of the Core blockchain ecosystem. The native token of the Core blockchain network is written as “CORE” or “$CORE”, with capital letters, to differentiate it from the “Core” network.
[2] A system is “composable” when its basic constituent parts can be combined in new and interesting ways.
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