In the world of cryptocurrency, Bitcoin is undoubtedly the most representative and influential digital asset. Although Bitcoin's widespread adoption and recognition has made it the "gold standard" of digital currencies, its limitations in scalability have gradually become problematic. For example, after the Segwit upgrade, the Bitcoin blockchain’s block size was limited to 4 MB, which meant that the number of transactions that could be processed in a given time was limited. As the number of network users increases, this limitation results in longer confirmation times and higher transaction fees, making Bitcoin unable to cope with large-scale transactions.
To address these challenges, the industry has proposed a variety of Layer 2 (L2) solutions, such as payment channels, sidechains, and Rollups. These solutions aim to increase Bitcoin’s transaction throughput by processing transactions off-chain, and strive to improve the user experience without compromising the security of the base layer. For example, the Lightning Network serves as a second-layer payment channel network that allows for almost instantaneous micropayments. The side chain is an independent blockchain connected to the Bitcoin main chain, providing greater script flexibility and faster transaction speeds. However, these schemes often come with complexities, trust assumptions, and potential security vulnerabilities.
Among many scalability solutions, Nervos Network provides a more native approach to improve scalability by modifying the UTXO model that underpins Bitcoin. Nervos Network was founded in 2018 with the goal of increasing Bitcoin’s scalability and flexibility. Its core component is Common Knowledge Base (CKB), a Layer 1 blockchain that provides Bitcoin with Turing-complete smart contract capabilities.
Technical architecture
The design of Nervos Network adopts a layered architecture, with CKB as its underlying blockchain, expanded through payment channels and RGB++ protocols. The core of CKB is the Cell model, which is an improvement on Bitcoin’s UTXO accounting model, allowing for more flexible data storage and verification.
Common Knowledge Base (CKB) CKB uses a proof-of-work (PoW) consensus mechanism, similar to Bitcoin, but optimized for efficiency and response speed. CKB uses the NC-MAX algorithm, which can dynamically adjust the block interval based on network activity to ensure faster transaction confirmation time. In addition, CKB uses a customized hash function called Eaglesong, which provides the same level of security as the traditional PoW hash function.
Cell model
CKB’s Cell model is the core of its data structure, allowing various data to be stored and verified on the chain. Different from Bitcoin’s single script verification method, CKB introduces a dual script mechanism:
Lock Script: Ensures that only authorized users can access and use the content in the Cell.
Type Script: An optional script that sets the rules for how a Cell will be used or changed in future transactions.
This design enables CKB to support more functions, be suitable for various application scenarios, and improve scalability.
CKB-VM
CKB-VM is the execution engine of CKB, supporting the operation of smart contracts and decentralized applications. This virtual machine is based on the RISC-V instruction set and is compatible with multiple programming languages, including C and Rust. The design of CKB-VM allows developers to use familiar tools for development, lowering the technical threshold. In addition, CKB-VM provides a predictable gas fee model, improving user experience.
RGB++ Protocol: The RGB++ protocol is an important innovation of the Nervos Network and is designed to extend the functionality of Bitcoin. This protocol allows complex smart contracts and asset management operations to be implemented on CKB, thereby solving the limitations of asset issuance on the Bitcoin network. The RGB++ protocol achieves seamless integration with CKB Turing-complete smart contracts by mapping Bitcoin UTXO to CKB's Cell.
The design of RGB++ enables Bitcoin assets to interact with decentralized applications (dApps) on CKB, greatly expanding the application scenarios of Bitcoin. Since RGB++ was launched on the mainnet in April 2024, more and more projects have begun to use this protocol to issue assets on Bitcoin, making CKB's on-chain activities revitalized.
ecological development
As of June 2024, more than 15 ecological projects are active on CKB. These projects use the RGB++ protocol to realize the issuance and management of assets. The Nervos Network team has promoted the development of CKB through continuous technological innovation and ecological construction, allowing it to occupy a place in the Bitcoin ecosystem.
in conclusion
As a core component of the Nervos Network, the CKB token represents the future of Bitcoin’s scalability. Through the improved Cell model, CKB-VM and RGB++ protocol, CKB not only improves Bitcoin's transaction capabilities, but also provides developers with a flexible environment to build decentralized applications. As more projects are added, CKB's ecosystem will continue to grow, providing users with a richer digital asset experience.