In Status Update #4 released in January, we outlined our idea for expanding the use of Tixl by using it to provide a second-layer solution for other digital assets. We have decided to call it the “Autobahn Network”. When making this call, we were careful to ensure that the Tixl Token (MTXLT) would not become obsolete, but rather this decision should support the increase in its long-term growth in value and sustainability.
Decentralization is a Major Requirement
One of the most important requirements for us was that the decentralization of Bitcoin – and other digital assets – should be preserved when using our Second-Layer Solution, as long as the supported asset itself has this feature.
In real terms, this means that neither the Tixl company nor any person or group will be able to access the Bitcoin in the Autobahn Network and – in the worst-case – steal it. Trust in the custody of the Bitcoin must therefore not lie in trust in the organization, but must be guaranteed purely by cryptography and a truly decentralized consensus algorithm. Since our aim is to stay decentralized, no single validator should be able to spend Bitcoins from the shared pool where the Bitcoins are deposited. The Autobahn Network can achieve this by using a threshold signature scheme (TSS). Check out The Technology behind Autobahn Network to get a deeper insight.
Why is the Tixl Second-Layer Solution called the “Autobahn Network”?
Autobahn is the German name for a highway. The German Autobahn is characterized by many features that can also be found in our Second-Layer Solution:
- Speed: World-famous, the German Autobahn is known for not limiting the speed limit (at least over certain sections). You are able to drive as fast as your car will let you.
- Gateway: As on any highway, there are defined entrances and exits to get you to the sections where the speed is unlimited.
- Privacy: No toll booths, no motorway use sticker, no controls. You travel without being monitored.
- Toll-free: Unlike some neighboring European countries, there are no toll stations on the German Autobahn and no license needed to use them for a certain period of time. This makes it very cheap to move around.
The Autobahn is something that is very special to Germans – the expression of freedom and self-determination. Freedom and self-determination are the same qualities that also play a central role for us as early adopters of cryptocurrencies and decentralized finance.
How does the Autobahn Network generate value for MTXLT?
You need fuel to get from A to B. When and how the fuel is bought can vary from project to project using the Autobahn Network. The standard way would be pay-per-use as we know it from the Bitcoin model. Opportunities also exist where a company wants to operate its own asset on the network. In this situation, it would not make sense for them to pay per-transaction and, instead, we could look to charge a monthly fee or listing/integration fees. This could be done by specifying an account for a listed asset and this account must burn the corresponding amount of TXL (which represents the fees).
To ensure the greatest usability, we decided against using TXL directly as “fuel” because it would provide an obstacle to use if you had to buy TXL before you are able to transfer BTC or other digital assets. This is something that has been criticized a lot in other networks that support different assets. As a solution, we settled on the idea of allowing transaction fees for certain assets (for example, BTC) to be paid in their native currency. One could send BTC through the Autobahn Network without having to purchase TXL and pay much lower fees than you would on the Bitcoin blockchain itself. The native fees generated are then used by the most trusted validators to purchase TXL on the public market, and these TXL are immediately burned. Buying TXL using the transaction fees increases the demand for them on the open market, and by removing these tokens from circulation (by burning them), the value of the remaining TXL increases.
The Autobahn Network delivers a novel way to move different assets on the network that is used by Tixl – which offers speed and privacy. In contrast to existing solutions, the Autobahn Network doesn’t rely on peer to peer payment channels, nor on centralized solutions to swap tokens.
To achieve this, several steps had to be solved:
- Decentralized Key & BTC address generation
- Decentralized key resharing (not implemented yet)
- Allowing users to deposit BTC into the Autobahn Network
- Send BTC through Autobahn Network
- Decentralized BTC withdrawal
If you would like a detailed insight into the technical implementation, have a look at the following article: The Technology behind Autobahn Network
Our goal for Q1 was to implement the core features for the next Testnet version “Blankenese”, and to test the feasibility of the second-layer solution at the same time. On top of this, we are still developing other features – such as shorter addresses and use of stealthchains etc. – and are working to implement these as soon as possible. We are very satisfied with the overall implementation of the new Blankenese features and are right on schedule. We have been able to implement the second-layer solution even sooner than expected, for the requirements of a Testnet, and are on track to have BTC transactions included in the next Testnet release – “Blankenese”.
- This was an article first published in medium by Cristian Eichinger, founder of TIXL.