There’s a quiet revolution in Bitcoin mining that you haven’t noticed

Spiral and Braiins have formed a working group to develop the Stratum v2 Bitcoin mining protocol. The main goal of the new protocol will be to make mining more decentralized, as well as make it harder to potentially censor the network at the protocol level. We decided to give you some details as this project is quite important for the future of Bitcoin as an independent project.

The key points briefly

What do they want to do and why? To keep it simple:

• The working group will organize administrative and technical processes for bitcoin miners who want to switch to the new Stratum v2 communication protocol that connects miners to the network. 
• The project is funded by BitMEX, Foundry Galaxy Digital, Spiral and Summer of Bitcoin.
• The key advantage of Stratum v2 is to allow individual miners (rather than pool operators as it is now) to construct blocks and determine which transactions will be included in them.
• What is the benefit of this feature? This change should reduce the risk of Bitcoin being censored at the protocol level. It creates an even more secure and decentralized network than the already existing one.
• Speaking of timing, work is in full swing. The SRI development group (Stratum V2 reference implementation) is already testing a prototype of the new protocol, and the stable version will be available at the end of 2022, probably in November–December. 

Thus, the mass implementation of this protocol is planned for 2023.

An open-source version of Stratum V2 is now live. It's the first upgrade in more than a decade to the protocol used by virtually all #bitcoin miners. New version could help open mining to more participants by supporting lower-quality internet connections: https://t.co/kzFq5iUYsJ

— MacKenzie Sigalos (@KenzieSigalos) October 11, 2022

Evolution of Protocols

Bitcoin has undergone three conditional stages of evolution in the mining protocols used to validate blocks and achieve consensus in PoS. Stratum v2 is the third, new stage in the evolution of Bitcoin mining protocols, which creates a level of service and protection adequate to the current challenges.

• Stage 1. Until the end of 2012, the getwork protocol was used for BTC mining. It was so primitive, that later in the middle of 2012 a new decentralized bitcoin mining protocol getblocktemplate was developed. It was the one that was used in the initial stage of the development of this blockchain network.
• Stage 2. First of all, it is the Stratum protocol, which was very progressive for its time, and which has now become the de facto standard for the largest mining pools. Stratum solved a lot of accumulated problems and allowed for effective management of communication between miners and pools. It was the protocol that successfully survived the problem of bitcoin’s growth when its network became really huge and popular in recent years.
• BetterHash is an alternative mining protocol. This solution is not a fork or a modification of PoS consensus rules, it allows very flexible work with both new protocols and old ones (while automatically switching to more progressive protocols if any pool provides that option). It allowed for compatibility with Stratum, giving additional options to those who need more flexibility. It was the first careful attempt to extend the super-popular Stratum without breaking anything.
• Stage 3. Stratum v2 is an integration of Stratum and BetterHash ideas to increase the decentralization of mining while eliminating all the bottlenecks inherent in Stratum. It is a very advanced solution, which is being tested right now, and its mass implementation is planned for 2023.

Why should I care about it?

While it’s not being talked about much in the press right now, the implementation of Stratum v2 will be just as important as the recent activation of the Taproot hardfork, which greatly expanded Bitcoin’s functionality and made a lot of noise in the news. The Stratum v2 solution will make the BTC mining subsystem more decentralized and almost immune to the full range of modern attacks and censorship attempts. 

That’s why it’s important to be watching this topic, as it’s a quiet revolution in the stability of Bitcoin, which is becoming too popular and heavyweight for previous solutions.