Minters, Guardians, and a Secure tBTC

Threshold Network -

The tumultuous events of 2022 have proved beyond doubt that decentralized infrastructure is vital if we are to make DeFi secure and stable. Foremost among them? A robust, permissionless, and secure bridge to Ethereum for the world’s most widely held cryptocurrency: BTC.

With the emergency shutdown of Alameda-owned renBTC in the wake of the FTX collapse, there is now no permissionless way to use BTC in DeFi. To fill that gap, Threshold has decided to significantly accelerate the timeline for the release of tBTC v2.

To ensure we can be there for BTC users cut off from Ethereum without risking either security or usability, Threshold will be taking a phased approach to the release. While ultimately minting on tBTC v2 will be fully permissionless, the protocol will at first operate with an optimistic minting model, powered by two main roles: Minters and Guardians.

Minters

Minters are a small, permissioned group of technically expert participants with deep DeFi experience who monitor the chain for revealed BTC deposits. If a deposit is valid and has accrued sufficient work, the Minter requests an optimistic mint of a corresponding amount of tBTC. This triggers an automatic delay of three hours, allowing for a final validity check.

Requirements for Minters

A Minter agrees to:

  • Run the minting script with access to:
    - a funded ETH wallet to cover gas fees for mints
    - an Ethereum node to monitor deposit reveals
    - an Electrum node to confirm deposits against the Bitcoin network
  • Keep the script up-to-date and monitor for errors.
  • To remain available in case of updates or network disruption.

Guardians

Guardians are a second, larger permissioned group drawn from the Threshold DAO and the wider DeFi community. They are responsible for verifying minting requests during the three-hour security window triggered prior to minting and can cancel any mint they deem fraudulent or nefarious and remove the errant minter.

Requirements for Guardians

A Guardian agrees to…

  • Run the guardian script with access to:
    - A funded ETH wallet to pay gas fees for mints
    -An Ethereum node to monitor deposit reveals
    -An Electrum node to confirm deposits against the Bitcoin network
  • Monitor BTC deposits across the network for unusual behavior.
  • To remain available in case of updates or network disruption.

Future plans (Updated!)

Later this year, Threshold will enable fully permissionless minting. Under this model, deposits by BTC holders are swept by stakers to a shared wallet with a Simplified Payment Verification (SPV) proof. Stakers report that the deposited BTC has been swept. The network is permissioned to stakers, who can deny deposits.

Update - (as of August 2023), Threshold has successfully enabled permissionless minting!

Optimistic minting will continue to operate with a shorter delay, allowing users who want to mint quickly to use it as a shortcut rather than waiting for periodic sweeps.

Learn more about how we’re building the most secure bridge in DeFi on the Threshold Discord, our Github, and on Twitter.