A protocol proposal for off-chain participation in Bitcoin Discreet Log Contracts (DLCs) using a Market Maker model. Instead of all players depositing funds on-chain, a single Market Maker fronts the entire DLC value on-chain while players buy tickets via Lightning Network HTLCs or PTLCs. The on-chain footprint remains constant regardless of player count. The protocol uses adaptor signatures and public key aggregation to ensure the Market Maker cannot steal funds. Settlement can happen fully off-chain in the optimal cooperative case, reducing on-chain transactions to just three P2TR-indistinguishable transactions. Use cases include lotteries, betting pools, and crowdfunding.

9m read timeFrom conduition.io
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ProblemSolutionConceptExampleDiscussionBenefitsUse CasesHTLCs instead of PTLCs

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