Statechains like Mercury:
  • Swapping in your private key rather than creating an on-chain transaction.
  • Centralized (one company, Commerceblock) runs the server (single point of failure), but it doesn’t “know” anything (blind signatures).
  • Unilateral exit to base chain with timelock (you can get your Bitcoin back even if the server goes away).
Sidechain like Liquid
  • On-chain transaction sends BTC to multisig wallet. Token (L-BTC) created backed 1-to-1 with bitcoins.
  • 11-of-15 multisig of federation required to peg-out (get your BTC back).
  • If something goes wrong with the federation for 7 days, Blockstream has an overriding key to retrieve the BTC.
Statechain (Mercury)54.2%
Sidechain (Liquid)45.8%
24 votes \ poll ended
First I heard of Mercury.
Liquid's been in operation for years without any hiccups that I can recall. WBD with Anita Posch just clued me in that there are options to swap into lightning using it. Add that it seems promising for asset issuance and I think the choice is clear between these two.
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Mercury has been in development for several years. There were articles and videos about "statechains" four years ago, which is what turned into "Mercury".
I wouldn't expect Liquid to have any major "hiccups" just yet. FTX, GOX operated for years "without issue"...
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Development != use.
Still have reservations about sidechain integrity but with time and knowledge Liquid seems to be getting there.
I didn't consider that Liquid might rug everyone and lead to a decade of litigation. Is Mercury immune to that?
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not as far as I know. They are very "centralized" but talk about a federated option. They also say that because of a special chip they use, private keys are not seen and are securely destroyed. While that's probably true, I don't see how it can ever be very distributed beyond an authorized federation, which is no better than Liquid from a centralization standpoint (though you still have the emergency unilateral recovery of funds with Mercury that you don't have with Liquid).
Liquid seems fine as a "service" but I don't consider it a scaling solution for Bitcoin that lives up to the values of Bitcoin.
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Solving very different problems and operate differently.
Mercury V lightning network
Liquid V Fedi
Those would be more thought processes
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sorry, what does "V" mean?
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Versus. He means vs. eg. Comparing Liquid to Fedi and Mercury to Lightning are more accurate comparisons.
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some notes:
mercury: you are trusting the coordinating server to delete the private key share on each transfer…
liquid: the emergency timelock is 4032 bitcoin blocks, so more like 28 days
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10 sats \ 0 replies \ @delta1 6 Feb
the SE needs to be trusted to … delete/overwrite the key share corresponding to the previous owner
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Yes but even with Liquid's emergency timelock feature, you are still dependent on a company to side with you and release your funds.
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i never said otherwise.
regardless, if those emergency keys ever have to be used, it would be to process pegouts.
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why do I have to trust either of these things? give me more options!
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149 sats \ 0 replies \ @joda OP 6 Feb
Ark?
I was trying to make it easy with fewer options! I just find it interesting that there has been so much development in x-chains over the last few years, and none of them (that I know of) have all the qualities that we would want in a Layer 2.
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I think I would thrust Mercury more, I thought anyone can run an SE not only Commerceblock, I think Liquid might face more regulatory risk and it can be more centralized, because ok N members, is it hard for blockstream or the gov to put them all in a call? If more people run Mercury it could be harder to regulate.
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I don't trust any of this. I'd rather use other forms of transactions. I don't use BTC for transactions,I just hodl
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If Bitcoin becomes a reserve asset and/or global money to a significant degree, there will necessarily be second layers.
I agree it's difficult to truly trust these. I see them as "services" rather than true layer 2.
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Why don't we get away with both of these I don't transact with Bitcoin at all as of now. I am only HODLing and would only involve ne of these when Bitcoin hits $100k later this year
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Some people want to use these to increase privacy, or to DCL with low fees on the side chain.
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