The most recent Bitcoin upgrade, BitVM, has generated a lot of interest in the cryptocurrency community and business. The Turing-complete Bitcoin contracts expressed by this computing paradigm have the power to completely alter the Bitcoin network. Even more remarkable is the fact that this can be done without altering the network’s consensus rules. They are similar to optimistic rollups in that they are just validated on Bitcoin rather than doing calculations.
By enabling the verification of any computeable function on Bitcoin, this method paves the door for the implementation of smart contracts on the Bitcoin network. But what does this mean for the two market leaders in smart contracts, Ethereum and Cardano?
In the DeFi and NFT markets, Ethereum, formerly the unchallenged leader, has been declining. Due to frequent frauds and a perceived lack of innovation after the 2021 bull run, the once-thriving DeFi and NFT landscapes have lost their lustre. On the other side, Cardano has been promoting itself as an Ethereum substitute that is more effective and scalable, but it is also having trouble obtaining mass use.
The game may drastically alter with BitVM on Bitcoin. A game-changer is the capability to do intricate off-chain computations without leaving any traces on the chain, unless there is a disagreement. It provides a degree of efficiency and secrecy that may turn Bitcoin into a potent rival in the field of smart contracts.
If this functionality is effectively implemented and adopted by Bitcoin, Ethereum and Cardano may lose some users and developers to it. Given the trust and security connected to Bitcoin and the new features of BitVM, it would be a desirable platform for programmers wishing to create decentralised apps.
Bitcoin’s position is further strengthened by the fact that it is Turing-complete, which enables it to verify the execution of any programme. The present model can only be used in two-party settings, although future generalisations could increase its functionality.
