🎇How does BitSig work?

Here's an overview of how BitSig works:

1. Vault Creation

   • A vault initiator sets up a new BitSig vault by deploying programmable smart contracts on the Bitcoin network. These contracts incorporate conditions under which the pooled Bitcoin funds can be accessed and managed.

2. Smart Contract Programming

   • The smart contracts are written in Bitcoin Script, a stack-based programming language that defines the rules for how bitcoins in the vault can be spent. These rules include the voting power of each signatory and the conditions required for a quorum.

3. Vault Governance and Multisignature Mechanism

   • Governance within the vault is executed through voting proposals. Vault signatories, who can number up to 999 with the Taproot upgrade, each have assigned voting power. They can cast votes on proposals to unlock funds. Vault unlocking rules can be programmed to degrade over time, meaning the required number of consenting signatories may decrease, adding a layer of security in case of key loss.

4. Interaction with Ethereum Virtual Machine (EVM)

   • Although the vaults are on the Bitcoin network, interaction with these vaults is facilitated through an EVM-compatible layer. This allows users to interface with the vaults using common web3 wallets, which are typically used within the Ethereum ecosystem, thus bridging the gap between Bitcoin and other blockchains.

5. EVM Mirror Contract

   • On the EVM network, a mirror contract is used to coordinate actions relating to the vault. This includes initiating withdrawals and voting on withdrawal proposals. The mirror contract records these actions and interacts with the smart contracts on the Bitcoin network when required consensus is reached.

6. Secure Withdrawals

   • When a withdrawal proposal reaches the necessary threshold of votes, the signatures are compiled within the mirror contract. Then, they are broadcasted to the Bitcoin network, specifically to the smart contract that governs the vault. The smart contract evaluates the signatures against the withdrawal conditions. If the criteria are met, the transaction is executed, and funds are released from the vault.

Bitune operates as a decentralized platform to securely manage large quantities of Bitcoin by fusing Bitcoin's advanced scripting capabilities with the flexible and widely-adopted tooling of the Ethereum blockchain, to improve user access and engagement with Bitcoin-based smart contracts.