CTV+CSFS: Can we reach consensus on a first step towards covenants?

The Ark case for CTV presents a compelling argument for its implementation, focusing on enhancing user experience through several key features. The Ark protocol introduces virtual utxos (vtxos), which are off-chain and rely on a tree of transactions constructed using the CTV covenant. This structure facilitates automatic vtxo reissuance, lightning receive capabilities, and the potential for mass payouts, making it a significant advancement in the blockchain domain.

In the original design, a vtxo is defined by a sequence of transactions, each linked by a policy that combines a CTV commitment with conditions based on the Ark server's key and the vtxo's expiry time. This design allows for the construction of vtxos entirely non-interactively, meaning users can issue their own vtxos based on predetermined Ark parameters. The development of clArk, a covenant-less version of Ark, introduces a shift towards MuSig2 pre-signatures for transaction verification, requiring the presence of the eventual vtxo owner for issuance, thereby limiting its applicability to scenarios where senders also act as receivers.

Despite these limitations, the ability to issue vtxos for others offers considerable advantages, such as sending vtxos without receiver participation in Ark rounds and the server’s capacity to automatically re-issue expired vtxos. Moreover, integrating Lightning payments into Ark becomes more feasible, allowing users to notify servers of incoming payments for the issuance of corresponding vtxos in the next round. This functionality extends to non-interactive onboards, facilitating exchanges or DCA providers to regularly distribute payouts to users by constructing a tree of vtxos independently.

The Ark protocol, particularly with the integration of CTV, proposes a robust framework for improving transaction efficiency and user engagement. Its innovative approach to managing vtxos represents a promising direction for blockchain technology, emphasizing ease of use, security, and flexibility. For detailed insights into the protocol and its applications, interested parties can refer to the Ark case for CTV and further information available at ark-protocol.org. The Second team is dedicated to refining these mechanisms, especially focusing on mobile client implementations, to better understand and enhance the user experience within the Ark ecosystem.