Discreet Log Contracts with Ecash Notes

A detailed cryptographic protocol for conducting Discreet Log Contracts (DLCs) off-chain using Chaumian Ecash mints as blind trusted intermediaries. The scheme allows two parties to place conditional wagers funded with Ecash notes, where the mint learns only the total funding amount and final payout structure — not the subject of the wager. The protocol uses blinded oracle locking points, Merkle trees for payout commitments, and locked Ecash notes to achieve strong privacy, constant-size on-chain footprint, and fast settlement without touching the Bitcoin blockchain. Security tradeoffs versus on-chain DLCs are discussed, along with scalability properties and future extensions like crowdfunding and cross-mint Lightning transfers. A proposal based on this work has been submitted to the Cashu specification.