Various Bitcoin protocols (Lightning, swaps, vaults, …) are still in their early stages, but we already can see some of the big challenges. Those protocols currently assume the possession of a UTXO by their participants. This is a scaling bound for a future with hundreds of millions of Bitcoin users. Another challenge raises from their unique on-chain fingerprint, which makes their use less private. Considering that some of them are privacy-oriented, the fingerprinting issue may result in imperfect fungibility. Coinpool is a solution to both problems.

Building on previous payment pool discussions, we proposed CoinPool, an improvement to confidentiality and scalability. CoinPool would serve as a wrapper for any other off-chain protocols.

Scalable and flexible payment pools are coming with new engineering challenges. Assuming the adoption of Taproot and SIGHASH_NOINPUT, their most-scalable versions would still require further softforks introducing light-weight cryptographic accumulators in Bitcoin Script.

See the coverage of CoinPool as well as the brief history of similar constructions in the Bitcoin Magazine.


While minding that problems solved by CoinPool are long-term, we are planning to publish a research paper and the associated softfork proposals in the upcoming year.