Last week, Blockstream launched the Liquid Release Candidate Network for participating Liquid exchanges. This new network marks the conclusion of the Liquid Beta program, and we are on the way to a production release in May 2018. The Liquid Release Candidate Network enables member exchanges to integrate their software with Liquid, to be ready at launch.
Liquid offers traders the opportunity to rapidly, securely, and confidentially move bitcoins between member exchanges, with a transaction finality of less than two minutes. The following demonstration video shows how this might look to a trader who wishes to move funds between two exchanges, explaining many of the concepts underlying the Liquid sidechain functionality.
We made several enhancements to Liquid for the Release Candidate Network:
- The Liquid functionaries now support Segregated Witness for managing the bitcoins that have been pegged into the Liquid network. This reduces the cost of transactions and allows for more complex transactions, including the ability to have more than 15 functionaries.
- The peg-in and peg-out functionality has been streamlined. This simplification moves bitcoins between the Liquid and Bitcoin networks seamlessly and reduces the complexity of integrating Liquid into exchanges.
- The emergency recovery procedure has also been simplified, utilizing the OP_CSV timelock feature of Bitcoin. This procedure allows the recovery of bitcoins pegged into the Liquid Network in the unlikely event that the network has an irrecoverable failure. While we never expect to use such a procedure, this advancement makes the bookkeeping needed by the functionaries simpler and ensures that the bitcoins in the network will be recoverable even in the worst-case scenario.
Liquid will be a great step forward in the maturity of the exchange ecosystem in terms of transaction privacy, security, and speed. We look forward to seeing exchanges integrate with Liquid over the coming weeks, to prepare for the production launch. If your exchange is interested in joining the Liquid Network, please contact firstname.lastname@example.org.