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Bitcoin’s UTXO Model
Bitcoin tracks ownership through Unspent Transaction Outputs (UTXOs). Each UTXO locks value to a script defining spending conditions. Transactions consume UTXOs as inputs and create new ones as outputs. This provides local validation (no global state), strong composability, and a DAG structure. The tradeoff: every spend requires onchain confirmation—block delays, fee competition, and mempool constraints make multi-step contracts fragile or expensive.Why Bitcoin L1 Falls Short
Block space is scarce, blocks arrive ~10 minutes apart, and demand is unpredictable. Result: unpredictable latency, volatile fees, unreliable ordering. Real-time or interactive contracts cannot rely on onchain execution alone. Traditional Bitcoin script uses commit-reveal patterns—lock funds, reveal values when spending. Works for atomic swaps and HTLCs. Breaks for persistent state, sequential updates, or multi-party coordination. Script cannot enforce output constraints or contract continuity.How Arkade L2 Solves This
Arkade replaces UTXOs with Virtual Transaction Outputs (VTXOs)—offchain outputs that execute instantly while preserving unilateral control of funds at any time. Dynamic settlement: transactions receive instant preconfirmation, then settle onchain in the next economically optimal batch anchored to a Bitcoin block. Users choose their finality tradeoff—speed now, full Bitcoin security on settlement.Scripting on Arkade
Arkade supports standard Bitcoin Tapscript for VTXO spending conditions. Any valid Tapscript works as a VTXO locking script. For multi-party contracts, a collaborative unilateral exit path can be added. This provides emergency exit if the server becomes unavailable.Deep dive into VTXOs, script compatibility, and the two-phase transaction flow
Arkade Script (Experimental)
Arkade Script extends Bitcoin Script with additional opcodes executable only in the offchain environment. These opcodes enable transaction introspection and state enforcement, but operate under preconfirmation trust assumptions—VTXOs using extended opcodes live in continuous preconfirmation state until settled onchain. Stateful contracts face batch expiry like any VTXO. The Intent System and Intent Delegation enable automatic renewal without user intervention.Explore Arkade Script syntax, types, and advanced contract patterns